Investor's Business Daily
Energy: Another day, another oil company fleeing the country. No, this isn't Ecuador, the banana republic that just defaulted on its debt after chasing out investors. It's the United States, and what we're seeing is self-defense.
Much political hay has been made in Congress about "unpatriotic" corporations that move operations abroad. Weatherford International is the latest, taking its headquarters from Houston to Switzerland. The oil services company said that it wants to be closer to its markets. But what it really meant was that it no longer saw the future in the U.S.
In a political atmosphere of blaming corporations, it's no wonder. Halliburton fled to Dubai in 2007. Tyco International, Foster Wheeler and Transocean International all went to Switzerland. As a pattern emerges, America's global standing diminishes, in part because it's based on the willingness of companies to invest. It's an especially bad sign when domestic companies flee. . . .
Huge companies such as Exxon Mobil, whose market cap exceeds the GDP of most countries, create $100 billion in earnings in quarters when oil prices soar. It looks high, but over the years, the industry's average returns, at 9%, are less than other industries.
Nevertheless, Exxon's profits are evidence of its success at extracting oil from miles below the earth's surface, even underwater, and from unbelievably hostile environments, such as the Arctic. Instead of being objects of national pride for their productivity and efficiency, and subjects of heroic Hollywood movies, their success is considered to be dishonest.
Congressional hostility affects oil companies' operations abroad, too: Exxon, remember, noted that Congress' animus toward oil profits directly encouraged Hugo Chavez's uncompensated expropriations of $1 billion of Exxon's assets in Venezuela, which drove oil prices higher. . . . .
Labels: democratscallingRepUnpatriotic, Economics, Economy, ObamaAdministration