PeopleProfitsPensions.com

As I was listening to the news - the regular news, not the financial news - I heard about ExxonMobil’s quarterly profits. Very high profits.

And, that was followed by an interview with a well-intentioned spokesman for a well-intentioned organization who deplored those profits. It was a shame, he said, that ExxonMobil (stock symbol XOM) was making such an enormous amount of money while regular folks were paying so much at the pumps.

But something was missing from his comments — the identity of the big oil company’s owners. Had he identified these greedy owners, his opinions might have changed, and changed a great deal.

You see, much of ExxonMobil (and most other big oil companies) is owned by those very same regular folks who the well-intentioned interviewee thought he was representing.

Yes, it’s true. Much of big oil is now owned by working people, through their pension funds, mutual funds, and whole life insurance.

Take for example California’s public employees, both past and present. The California Public Employees’ Retirement System (CalPERS) owned 30-million shares of ExxonMobil, worth a whopping $2.5 billion in May 2007. That represents slightly more than 1% of its entire portfolio of assets. Or to put it another way, ExxonMobil’s profits matter to the people who have or will retire from state and local government service in California.

Sure, some rich people do own oil stocks, and they’ve done very well, too. But, it’s a fact of life that rich people are vastly outnumbered by working people (most of whom usually don’t know they’re owners, either).

The 800 pound gorillas of the investing world these days are pension funds and mutual funds, known collectively as institutional investors. With billions and billions of dollars at their disposal, they invest widely and deeply. In other words, they invest in a lot of companies, and invest a lot in many of them.

Bottom line: Much of the profit earned by ExxonMobil and other oil companies will end up funding the pensions of working people across the USA and other countries.

Don’t be misled by well-intentioned critics of the oil industry or business. If their came true, we’d all have less prosperous retirements.

Almost every day, we hear complaints about corporate profits: about oil companies with windfall earnings, about pharmaceutical companies with monopolies on new drugs, and many others.

But, do you know who owns the corporations that make those big profits?

Well, you’re probably one of them. If you belong to a pension plan, invest in mutual funds, or own a whole life insurance policy, you’re one of the capitalists getting those huge profits.

Working people — through those pension funds, mutual funds, and insurance companies — now own much, if not most, of big business. Simply put, modern corporations exist to make it possible for you and me to enjoy a retirement income beyond what the government pays.

Actually, many government pension funds now invest in corporations, too, so even your government pension may depend in part on corporate profits.

This blog explores the connections among working people, corporate profits, and pensions (retirement income, whether formal pensions or not). As the title of the blog suggests, I’m interested in the ways that working people get the profits of big corporations through their pension plans: People, Profits, Pensions.