ExxonMobil (NYSE:XOM) released earnings last week that turned some heads. Thanks to record high prices for natural gas and oil, the integrated energy giant made $11.7 billion in the quarter -- the most profitable quarter for any public company ever.

And that angered some people.

Presidential candidate Barack Obama called Exxon's money-making abilities "outrageous" over the weekend, as did Senator Joe Lieberman on Meet the Press. And Obama proposed a $1,000 energy rebate for working couples that would be funded by "a windfall profits penalty on oil selling at or over $80 per barrel."

Is such a move anti-capitalist, or necessary to return sanity to the market?

Tim Hanson: Overlooked in the attack on Exxon's record earnings is the fact that the company's stock actually dropped on the report since it fell short of analyst expectations. Further, the company's net margin in the quarter was just 8.5%, which ranks the company in just the 69th percentile in that category among all public companies. That's good, but not great, and certainly not worthy of a company deserving a "profit penalty."

The fact is that oil exploration and production is a capital intensive and cyclical industry. Thanks to sustained high prices in recent years, E&P companies have been able to search for and find reserves in places that were once uneconomical, such as the very deep water. In 2006, for example, Chevron (NYSE:CVX) , Devon Energy (NYSE:DVN) , and Statoil announced that they had drilled a successful test well called Jack 2 in the Gulf of Mexico through 7,000 feet of water and another 20,000 feet of earth. It was hailed at the time as the largest U.S. oil find in 40 years.

Yet progress on the Jack project has been slow-going as a result of a lack of supply of deepwater rigs and, I would guess, uncertainty about the economics of extracting oil from such deepwater given the threat of an $80 per barrel price cap.

While the current energy crisis is painful, the solution is not price caps or profit penalties. Rather, if we give entrepreneurs the opportunity to make money by finding creative ways to extract oil from exotic places or invent viable long-lasting batteries for electric cars, they will tap the capital markets and get after a solution. In the meantime, as consumers, we need to adapt.

Joe Magyer: We Americans are a funny bunch. Coca-Cola sells us sugar-water that rots our guts and fattens our children -- earning a near-20% rip in the process -- and we praise it as an American icon. Exxon risks billions annually in the quest to provide us with essential hydrocarbons, facing down wily dictators and geological challenges worthy of a History Channel special in the process. Its reward? Thin margins and being lambasted as the epitome of greed and corporate irresponsibility.

The biggest irony in this whole traveshamockery is that we're all stakeholders in the success of Exxon and its Big Oil peers. People tend to forget (or ignore) that Exxon, ConocoPhillips (NYSE:COP) , and friends are publicly traded companies. That's right: Exxon isn't a clandestine organization owned by a small group of Texans who boast world-class ivory collections. If you're invested in an index fund or part of a defined-benefit pension plan, you own ExxonMobil.

And your stake in Big Oil's success doesn't stop with your Exxon shares. Did you enjoy your economic stimulus check? According to The Wall Street Journal, Exxon alone paid nearly $65 billion in U.S. taxes between 2003 and 2007. For perspective, that dwarfs the total tax bills paid by both Wal-Mart (NYSE:WMT) and General Electric.

Finally, chew on this: You think gas prices are expensive now? Slap an arbitrary, reactionary windfall tax on oil at above $80 a barrel, and you'll find out what real gas pains feel like.

Brian Richards: This idea is a little bit like the McGriddle -- while I like the concept of bacon and eggs sandwiched between syrup-infused pancakes, the reality disappoints. After all, the theory behind taxing the greedy oil barons and rewarding Joe Consumer sounds good -- who doesn't like a good Robin Hood story? -- but it's a bit outdated.

For the record, I don't think this will ever go through, even though the idea plays well to some voters. For one (and as both Tim and Joe point out), the entire basis for this tax is mistaken -- it looks at profits, rather than profit margins. Exxon's margins are almost half those of McDonald's (NYSE:MCD) , for example. (By the way, this windfall tax issue isn't unique to America -- BP (NYSE:BP) is facing the same issue.)

From gold to fertilizer, commodity prices have been on an absolute tear over the past year. But with the costs of filling up a gas tank, heating your home, or racing your cigarette boat at very high levels, the tax issue is (unsurprisingly) being arbitrarily applied to one particular commodity -- oil. As Warren Buffett recently said on CNBC, "I don't think that picking anybody that's had a commodity that's increased in price a lot and saying that there's a special tax because of that makes any sense."

In other words: Why not coal or steel or copper or the farmers benefiting from soaring food prices? Because even though they may do business in an identical fashion, and even though they may sell products that we need just as much as oil, and even though they may have better profit margins, they don't have the gaudy, headline-inducing profits of an Exxon.

Finally, the U.S. tried a windfall profits tax in the 1980s, and it didn't work out so well. Complying with the tax code was a burden for both the company and the IRS, and one study found that the tax back then had the effect of "increasing American dependence on foreign oil sources by 8% to 16%" because it decreased domestic production.

That's one thing we definitely do not want.

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