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prices down, prevent job losses, and prevent manufacturing
plant shutdowns, the organization said.
DEFENDING BIG OIL
When Exxon announced that it had earned $10.7 billion in prof-
its in the first quarter of 2011—an increase of 69 percent over
the same period in 2010—the news set off a firestorm. The US
economy was in the middle of the Great Recession, a major eco-
nomic slump. Many Americans were struggling to find work
and pay their bills. At the time, gasoline cost almost four dollars
a gallon—more than one dollar a gallon higher than the year
before—adding to financial hardships for working people.
Many Americans felt that Exxon was exploiting consumers at
the pump. As Nate Hagens of the Post Carbon Institute explained,
“Americans are upset because they envision such hefty profits as
direct transfers from their thin pocketbooks to Exxon.”
President Barack Obama reacted to the news of Exxon’s
profits by calling for new taxes on the oil industry. Democratic
congresswoman Nancy Pelosi of California said that existing tax
breaks for oil companies should be reduced. Pelosi argued that
tax breaks amounted to a handout to Exxon from US citizens—
and that Exxon certainly didn’t need a handout.
Exxon and other oil companies were quick to defend
themselves. Industry leaders pointed out that many factors
influence the price of gasoline and other petroleum products—
and that these factors were often out of oil companies’ control.
For instance, political unrest in the Middle East sometimes
disrupts the global oil supply, and when less oil is available on
world markets, prices rise. Natural disasters can also interfere
with the world’s oil supply. For example, in the summer of
2005, Hurricane Katrina and Hurricane Rita damaged many oil
drilling rigs and oil refineries on the Gulf Coast of the United
States. A spike in oil prices followed these storms.
