You know that I am no economics expert, but I had this thought the other day and I ran it by Toby. As we were driving into town, I was thinking how nice it is that gas prices are going down. Here in OK, they are about $2.09. Now I am thrilled like everyone else, but then again, it is cause for worry. While oil prices have been up, things in this area have been booming. Halliburton has been hiring as well as other oil production companies in the area. Toby’s nephew, who lives in Bridgeport, TX, has been doing great working for an oil field construction company. Sam, a young friend of ours with four children, has been able to do very well for his family while living in Ft. Worth and working for a company similar to Halliburton. Sam does not have any special skills or education, yet he is a hard worker and the oil field has been perfect for him. Before his oilfield job, Sam’s family had to rely on welfare and other government handouts to make ends meet. That is kind of the way it is around here. With prices up, there has been lots of new production and re-opening of wells and such. People are working. When prices drop, so will jobs.
So, if the oil/gas prices go down, will production continue? I can remember Toby’s brother-in-law explaining years ago, that some wells were not worth pumping when oil prices dropped. Some are just shut down or capped. But when prices are up, it is worth the time, effort and money to go back in and start pumping these wells. When prices are up, it is worth the effort to do new drilling. But when oil prices are down, the cost of pumping and production is just not worth it. As prices drop, so will production, so will exploration, so will the job opportunities, etc. When I mentioned this thought to Toby, he added that the Democrats want to reinstate the windfall profit tax – add extra taxes on those who make money – tax the wealthy. I did go to Wiki and read up on windfall profit tax and found it very interesting. And you know that Obama and the Dems are just itching to pass this tax on oil companies and "spread the wealth." So, I don’t understand how the Dems can be for more domestic oil production and yet want to impede oil companies. What is their incentive to keep up production and look for new production? If an oil company or other oil production related companies are hiring and spending money and making money and paying taxes, why does Obama want to penalize them or cripple them with higher taxes? Aren’t these companies already spreading the wealth?
I guess, I just don't get it. I just don't understand how someone could want to take someone else's money other than because of greed and covetousness.