Author Topic: Oil depletion allowance  (Read 7679 times)

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BT

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Kramer

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Re: Oil depletion allowance
« Reply #1 on: May 04, 2011, 07:58:37 PM »
Generally speaking Obama doesn't know his ass from a hole in the ground. And oil is just one more topic that he's in way over his head on.

Xavier_Onassis

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Re: Oil depletion allowance
« Reply #2 on: May 04, 2011, 08:13:24 PM »
Being as I had money invested in an independent oil & gas company (Kelley Oil) for about ten years, I DO know what they are talking about, and in my opinion, it has very little to do with an incentive to drill. Depletion allowances are given AFTER the well is drilled, producing and making a profit. It is based on an estimate of the amount of oil that can be produced. Oil companies do not create many jobs after the well is in place and producing, by the way. Oil production is a capital-intensive industry, that onloy hires a lot of people before the well is in production.

Palin doesn't know diddly about this.
"Time flies like an arrow; fruit flies like a banana."

BT

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Re: Oil depletion allowance
« Reply #3 on: May 04, 2011, 08:16:03 PM »
Being as I had money invested in an independent oil & gas company (Kelley Oil) for about ten years, I DO know what they are talking about, and in my opinion, it has very little to do with an incentive to drill. Depletion allowances are given AFTER the well is drilled, producing and making a profit. It is based on an estimate of the amount of oil that can be produced. Oil companies do not create many jobs after the well is in place and producing, by the way. Oil production is a capital-intensive industry, that onloy hires a lot of people before the well is in production.

Palin doesn't know diddly about this.

Apparently she knows more about it than Obama.

Xavier_Onassis

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Re: Oil depletion allowance
« Reply #4 on: May 04, 2011, 08:21:18 PM »
She knows what they tell her to say. She explained NOTHING about the reality of this issue.

Palin is a dingbat.

Somehow, the teensy subsidy that the government pays to PBS is way too much, but 4 billion in subsidies (not deductions, subsidies)  for some damn wildcatters is crucial to life itself. 
"Time flies like an arrow; fruit flies like a banana."

BT

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Re: Oil depletion allowance
« Reply #5 on: May 04, 2011, 08:24:36 PM »
She knows what they tell her to say. She explained NOTHING about the reality of this issue.

Palin is a dingbat.

Somehow, the teensy subsidy that the government pays to PBS is way too much, but 4 billion in subsidies (not deductions, subsidies)  for some damn wildcatters is crucial to life itself.

Well at least you get the tax allowance is for wildcatters. Obama is painting it as for BIG OIL, thankfully a dem congressman pointed out that that just is not so.

Xavier_Onassis

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Re: Oil depletion allowance
« Reply #6 on: May 05, 2011, 12:44:43 AM »
An oil depletion allowance is based on the theory that with every year oil is pumped out of a well, there is less oil that can be pumped, and so you should get a deduction for this. The fact is that there is no way to know how much oil can be pumped out of a given well, because oil flows from a distance into the pumping area, and no one knows how much is there or how much you can pump. There are wells in Texas that have been producing for forty years. They can inject water , steam  or chemicals or fracking fluids and revive old wells AFTER they have claimed an oil depletion allowance.

If a depletion allowance is bogus and nort allowed for the big producers, why does it make sense for the smaller ones?


Suppose we apply the same principle to income tax, since every year that you live, you have one year less of lifespan, and therefore the government owes you some sort of credit for that. It is a bogus horseshit idea thought up back in the 1930's or earlier. Oil is a gamble, like your life or mining is a gamble. You don't like it, then do not mine ore and do not pump oil.

And we will never get a life depletion allowance.
"Time flies like an arrow; fruit flies like a banana."

BT

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Re: Oil depletion allowance
« Reply #7 on: May 05, 2011, 12:53:32 AM »
The larger point is that Obama is saying the depletion allowance is for BIG OIl and hasn't been since the 70's.

I have been for a flat tax almost as long.

Xavier_Onassis

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Re: Oil depletion allowance
« Reply #8 on: May 05, 2011, 11:39:02 AM »
So far as I know, the Flat Tax was not discussed until Steve Forbes ran in 1996 on this as his platform. It was pointed out that Steve Forbes, who owned his own company, could then juggle options and such and pay ZERO tax. Then he opened his mouth and everyone fell asleep.

If we need to raise more revenue for the government, abolishing the oil depletion allowance would accomplish this far more than diddling with NPR or PP, and it would not end oil wildcatting, either.

"Time flies like an arrow; fruit flies like a banana."

BT

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Re: Oil depletion allowance
« Reply #9 on: May 05, 2011, 12:37:31 PM »
The original income tax was flat . 1% on anything over 3k.

Xavier_Onassis

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Re: Oil depletion allowance
« Reply #10 on: May 05, 2011, 12:43:31 PM »
Good for it.

I do not see the flat tax as being likely, or the "fair" tax, either. Eliminating a lot of loopholes from what we have would be quite useful.

"Time flies like an arrow; fruit flies like a banana."

sirs

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Re: Oil depletion allowance
« Reply #11 on: May 05, 2011, 12:52:48 PM »
Both Flat & National sales tax do just that, remove ALL loopholes, not just "a lot"
"The worst form of inequality is to try to make unequal things equal." -- Aristotle

Xavier_Onassis

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Re: Oil depletion allowance
« Reply #12 on: May 05, 2011, 04:17:11 PM »
I do not dispute that.

But the "Fair" Tax (which is not fair at all, puts every taxpayer in the position of getting a monthly check from the government.

The flat tax is simply unfair to nearly the entire population.

A better solution would be to eliminate many of the loopholes in the present tax.

"Time flies like an arrow; fruit flies like a banana."

sirs

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Re: Oil depletion allowance
« Reply #13 on: May 05, 2011, 04:20:35 PM »
No, actually a better solution is no loopholes, and everyone pays.  The more one makes, the more they pay in a flat tax, while the more one buys the more one pays in a national sales tax.

Your evil "rich" are having to pay their "fair share" under both scenarios, and no loopholes for anyone
"The worst form of inequality is to try to make unequal things equal." -- Aristotle

Xavier_Onassis

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Re: Oil depletion allowance
« Reply #14 on: May 05, 2011, 04:50:28 PM »
The more one makes, the more they pay in a flat tax,

That is incorrect: the Flat tax is a sales tax.
It is NOT based on income, it is based on consumption.

Observe that what we have in the US is a society based on consumerism.
Then consider the adage that if you tax something, you will get less of it.

Less consumption, slower economy.

NOT a good idea. I won't vote for anyone who want a flat tax or a "Fair" tax, but the flat tax is worse.
"Time flies like an arrow; fruit flies like a banana."