Slashdot Mirror
Oil Man Proposes Increase In Oklahoma Oil-and-Gas Tax
Hugh Pickens DOT Com (2995471) writes "Daniel Gilbert reports at the WSJ that Oklahoma oil man George Kaiser is breaking with fellow energy executives in asking the state to raise taxes on oil companies, including his own. 'Oklahoma is in desperate financial circumstances,' says the billionaire who controls Kaiser-Francis Oil Co. Kaiser says a higher tax on oil-and-gas production could help the state pay for education and much needed infrastructure improvements, and is asking legislators to return the state's gross production tax to 7 percent, challenging a plan proposed by fellow oil company executives who want to see the rate settle at 2 percent for the first four years of production.
Several energy companies and the State Chamber of Oklahoma say that lower tax rates for the costliest oil and gas wells are necessary to continue drilling at a pace that has stimulated economic activity and created other sources of revenue. Berry Mullennix, CEO at Tulsa-based Panther Energy, credits the tax program for helping his company grow to more than 90 employees, up from 18 a few years ago. 'I would argue the tax incentive is a direct reason we have so much horizontal drilling in the state today,' Mullennix says ... When companies decide to drill a well, they make their best guesses on how much it will cost to drill the well, how much the well will produce and what the commodity price will be. All of those estimates can vary widely, Kaiser says. 'With ad valorem taxes, the difference among states is 2 or 3 or 4 percent. The other factors can vary by 50 or 100 percent.' Compared with those other factors, Kaiser says the tax rate is incidental. 'It's a rounding error.'"
Several energy companies and the State Chamber of Oklahoma say that lower tax rates for the costliest oil and gas wells are necessary to continue drilling at a pace that has stimulated economic activity and created other sources of revenue. Berry Mullennix, CEO at Tulsa-based Panther Energy, credits the tax program for helping his company grow to more than 90 employees, up from 18 a few years ago. 'I would argue the tax incentive is a direct reason we have so much horizontal drilling in the state today,' Mullennix says ... When companies decide to drill a well, they make their best guesses on how much it will cost to drill the well, how much the well will produce and what the commodity price will be. All of those estimates can vary widely, Kaiser says. 'With ad valorem taxes, the difference among states is 2 or 3 or 4 percent. The other factors can vary by 50 or 100 percent.' Compared with those other factors, Kaiser says the tax rate is incidental. 'It's a rounding error.'"
An oil tycoon wants to give more of his money away, on purpose! Truly this is the first sign of the end of days!
Good for him... He thinks he doesn't pay enough taxes... That's mind blowing.
Weird.
"Helping to keep you two steps ahead of the Thought Police!"
The other companies that argue higher taxes would scare them from drilling are full of crap. How about paying a fair share to keep the infrastructure well maintained and the populace well educated?
As the last line of the summary says. Compared with those other factors, Kaiser says the tax rate is incidental. 'It's a rounding error.'"
"No matter where you go, there you are." -- Buckaroo Banzai
Berry Mullennix, CEO at Tulsa-based Panther Energy, credits the tax program for helping his company grow to more than 90 employees, up from 18 a few years ago. 'I would argue the tax incentive is a direct reason we have so much horizontal drilling in the state today,' Mullennix says
It would be far more efficient to tax the damned company and keep it at 18 people and use the money to bridges and roads and schools. That would create far more than the measly 72 jobs created by that company.
Look, these entrepreneurs are hard negotiators. If the taxpayers start with, "please please please create some jobs", they will ask for an arm and a leg. You give them an arm and a leg they will be back next year, "an arm and a leg? That was last year. What are you gonna give us this year?". You give another arm and a leg. And the year after they ditch you and go to the next country or state or country because, "your state has people without arms and legs, we can't employ them".
There is plenty of capital. If this Panther Energy does not want to invest there will be a Jaguar Energy or Tiger Energy. The capital markets are sloshing with 3 trillion dollars not knowing where to invest. Tell them the same thing they tell their employees, "this is what this job pays, if you don't like it, keep moving there are plenty who would work at this wage". Well, "this is what costs to do business in our state. If you don't like it, keep moving there are plenty of other investors for us". Unless the tax payer negotiates like this, you will not get anywhere. These crony capitalists invest in the election system, and get their own shills elected as legislators and government executives. That is why money in politics is so insidious.
What we now lack is demand. That is what is stifling the growth. Not the lack of capital, Not the lack of labor (lack of labor would lead to wage inflation). What we need is tough negotiators to represent the tax payers in the government.
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
Oklahoma is one of the most conservative states of the Union. Instead the state government, under pressure from jerb creators, will cut social programs and raise sales taxes, while cutting corporate income taxes.
Hail Eris, full of mischief...
E pluribus sanguinem
Texas has this issue too where Perry runs around to "over regulated liberal states", dishes up big tax breaks for them to put a plant in Texas, and ignores the costs while claiming all of the unrealized future benefits! Going to California and cutting a tax break to a small company of the tune of $50 million is a boon to that company but it makes no sense to the market or the state because they will never "create" $50 million in revenue for the state.
This behavior is stuff that creates bubbles and is just government deficit spending under the guise of "job creation". But that isn't their concern today is it because when the time comes that the business fails or overloaded infrastructure needs upgrades and expansions they won't have to deal with the raising taxes or a bond because they'll be long gone.
No, he's the opposite of Limbaugh -- he's a philanthropist.
He was listed as the third largest donor behind Warren Buffett and Bill and Melinda Gates in 2008. He's also taken the Giving Pledge to give away half of his wealth to charity. The George Kaiser Family Foundation gives millions to the causes of education, child poverty, and community health services.
He's been proposing eliminating tax breaks for oil and gas companies for years. He would rather the money go to health and education.
He's not using this as a political stunt, he's willing to put his money where it counts instead of just being a blowhard like Limbaugh.
Are you..high?
Taj Mahal schools? what? half a year? what teacher only works half a year? Teacher work MORE hours today then ever. Teachers pay more out of pocket expensive for the class room then ever.
Average Work schedule
Works 9 months
Teaches 8 hours per day
Arrives early or stays late by about an hour
Spends 3-5 hours daily planning, grading, communicating with parents, attending meetings, etc.
Spends 2-4 weeks per year participating in continuing education
Spends 3 weeks per year planning curriculum
Spends 4 weeks per year getting ready for the new school year
Pay:
3600 = 29,000 adj for inflation 5000 = ~40,000**
from a Red Bank NJ Newspaper from 1958:
The guide Is based on the new state "A-9" minimum salary schedule. Teachers with emergency certificates will receive $3,600 minimum to $5,000 maximum, over an eight-year period, with $200
annual Increments.Teachers with a BA degree will receive $3,800 minimum to $5,800 maximum, over an 11-year period, with a $200 annual increment. Teachers with an MA degree will receive $4,000 minimum to $6,200 maximum, with a $200 annual increment
Average starting wage in NJ todays is $36,141
When you take into account the addition expenses someone is expected to have to day, compared to 1958 that is not more money.
** This is a crude overal inflation number. Put intp p[perspective to other idustries, teacher was ahas risen less, 2 to 16 % less per year.
The Kruger Dunning explains most post on
A) Who cares?
B) It applies to new production; which include himself.
C) His company started in 1966. the lower tax didn't started until 1995.
IN short, you are wrong on every point.
You're welcome.
The Kruger Dunning explains most post on
Personally I'd like to see the IRS eliminated and the Fair Tax Act implemented.
It's a consumption tax on retail sales with a modestly complicated "pre-bate" scheme to help low income folks with the increased sales taxes. Not complicated to understand what it is. There is plenty of disagreement however regarding whether it is a good idea. It's (probably) progressive on consumption but regressive on income. It also would effectively become a very large entitlement program similar to social security. I don't see it as any more "fair" or sensible than any number of other tax schemes I've seen. Just because they title it "Fair Tax" doesn't mean it actually is better or more fair.
As you hinted discussions of "fairness" tend to leave out clear definitions of what they mean by fair - fair in what sense? Percent of income? Percent of purchasing power? Percent of wealth? Some combination? There is no tax strategy anyone has devised yet that will be "fair" under every possible measurement. The best you can really hope for is a sort of least-worst scenario which optimizes tax revenue (not too high or too low) without unduly burdening any single segment of society but that's more of an aspiration than a realistic scenario.
...one of my favorite infotainers rush limbaugh was talking about this very meme yesterday on his show.
Because Rush is obviously an unbiased source of rational analysis... No chance at all that he would try to twist an event to try to bash liberal ideas. [/sarcasn]
postulates that super wealthy individuals propose liberal ideas not because they really believe them, but to shield themselves from criticisms from the media.
Or maybe we go with the simpler explanation that many of them actually believe what they are saying. It is possible to be wealthy and have liberal ideals you know. It's not like this guy is really in need of shielding from the media.
i must say...due to the timing it would seem that mr. kaiser is a rush fan.
Lots of people like to have their biases confirmed. Doesn't make them correct however.
Virtucon, your anger is severely misplaced. Many of those regulations that are making life difficult for you are primarily from larger businesses that want to keep you from competing fairly with them. That's not to say that there aren't some that are real efforts at fixing a problem but that aren't well-designed, but that's the sort of problem that could be fixed assuming the government was set up to respond to the people. I'm guessing there are also some annoying regulations you don't like that are actually really beneficial, but I wouldn't expect anyone to be able to easily tell all of them apart when there are so many regulations, some federal, most state and local. You are lumping all of the problems together, but in order to solve anything you need to understand the separate components and how they fit together. We could discuss those issues forever though, so I'll focus on the root problem. If we could eliminate corporate contributions to campaigns by constitutionally distinguishing corporations from people, and money from speech, then your voice would actually matter to politicians, and you wouldn't see nearly as much of the horrendous waste we witness.
Did you see the recent study that found that over the last 40 years policy at the federal level is completely uncorrelated with public opinion and highly correlated with the opinions/wishes of wealthy and special interests? Once we solve that problem, then we can see what happens and then have a real conversation about how big government should be and what it should be involved with at what level. Until then neither of us will achieve what we think is the proper approach in government. If you really want things to change, call your state representatives and tell them they need to pass a resolution calling for an Article V convention to deal with the issue of money in politics. Common Cause, Wolf PAC, and Move to Amend are all working on this, among others I imagine.
A rich asshole who has everything life has to offer feels guilty and proposes liberal ideas. No! Say it ain't so! That's SO unique!
Wrong! Headline reads, "CEO of an established oil company, seeks to eliminate subsidy on new competitors, while pretending to be self-sacrificing."
Don't waste your vote! Vote for whoever you want, unless you live in a swing state it won't matter anyways