Ben Stein has a Commentary in the NTImes today, and Anyone who can access it should. He provides insight into many areas, and makes the declarative statement:
In total, profits are by far the highest they have ever been, running at a rate of very roughly $1.38 trillion in the first quarter of 2006. As a percentage of gross domestic product, profits are also the highest they have been since the statistics began being kept in 1959 — roughly 12.7 percent.
Ben is the Commentator of known reputation, and often grants shrewd insight. The statistics above are probably true, although there will be revisions before We arrive at total determination of exact numbers for 2006. What possibly can be said is Total Profits will undoubtedly reach over $3 trillion for 2006. We are over halfway through the Year, and baring absolute collapse, Profits will not shrink below 10% until the new Year.
Other Aspects of his commentary could use a little explanation. He questions the persistent American discontent with the Oil companies. A simple explanation for All: The Oil companies, counting Executive bonuses and Stock options, were making approximately (17%?) Profit overall Average when Oil was $36/barrel. Today, Oil companies are drawing about (17%?) Profit on average, excluding Executive bonuses and Stock Options, on a higher Volume of Oil (no numbers without Search, but think over 12-14%). Their Labor Costs have at most increased by 20%, and their Capital Costs by a probable 10-12%. Does it make Anyone desire to join the Oil industry.
Ben wonders why Retail and Trade Labor is not getting the Pay Raises normally associated with an increase of Profits--what he considers normal practice, but something which realistically occurs only with the presence of a strong Labor Movement. Study of 19th and 20th America states that prior to WWII, outlines Pay Raises came only with Strikes. The low rate of Employment, combined with Immigration, keeps longterm Wage rates static. The low Labor Participation Rate highlights the American Change, when before Americans used to Work for a Living; now, they accept Welfare or live off Profits. Some Economists may even admit that the later two forms of Subsistance are the most expensive forms existent, and will eventually kill an Economy. lgl