Gas Prices: What Can the President Do?

The media is either economically illiterate or deliberately biased on the matter.

Gasoline prices are skyrocketing, as many news reports attest. The stories blame a variety of factors for the uptick — from unrest in Egypt to rising summer demand. But, like the absence of Pierre from Sartre’s café, the stories hold a gaping absence in which something ought to be. That something? The sinister implication that blame should fall on the president.

Such an implication — if not the outright accusation — was rarely out of public view throughout the eight years of President George W. Bush’s stay in the White House.

A few years ago, House Minority Leader Nancy Pelosi fumed that Americans were paying a whopping $2.91 per gallon for gasoline. Denouncing the “record gas prices ... and record oil company profits,” she blamed “President Bush, Speaker (Dennis) Hastert and the Majority Congress. ... Big oil and gas companies wrote the Republican energy bill, and the American people paid the price.”

“(We) need a president who can stand up to Big Oil and big energy companies and say enough is enough,” declared Sen. Barack Obama.

“Today’s record-high gas prices are the price that the American people are paying for the Bush Administration’s failed energy policies,” agreed Sen. Hillary Rodham Clinton. Democrats demanded hearings — and, once Pelosi became House majority leader, got them. “Congress Grills Oil Execs on Record Profits,” ran the headlines.

Gasoline prices certainly did rise under Bush, soaring 180 percent from the day he took office to their all-time peak in July 2008. They plunged after that and, after adjusting for inflation, stood 9 percent lower when he left the White House than when he entered it. Since Obama took office they have doubled: Gasoline prices stood at $1.72 per gallon in January of 2009 and last month averaged $3.48.

Oil company profits have been humming right along, too.

You can’t expect Democrats to blast their own president for any of this. But what about the press? The Business and Media Institute, an arm of the conservative Media Research Center, analyzed coverage for two comparable periods of gas-price increases, in 2008 and 2011. It found the big three networks did more than twice as many stories on gasoline sticker shock in 2008 as they did three years later.

Well, maybe other stories were competing for attention in 2011, right? Fair enough. Yet consider this: Stories about gasoline prices mentioned Bush, the government or the president 15 times as often in 2008 as they brought up Obama or the government in 2011.

This is particularly striking when you consider the two administrations’ policies. The rap against Bush held that all he wanted to do was drill, drill, drill — an approach that would increase the supply of gasoline and potentially lower prices. Obama, on the other hand, insists “we can’t just drill our way to lower gas prices.” (Though he does say we can achieve the same result through proper tire inflation.) He has balked at approving the Keystone XL pipeline.

Before being appointed, Obama’s first Energy Secretary, Steven Chu, said, “We have to figure out how to boost the price of gasoline to the levels in Europe.” Yet when gas prices rise, none of this seems to merit even a mention.

If you think that difference in treatment arises from partisan or ideological bias, you’re right. Last year, The Washington Post noted that “Democrats in 2006 were more inclined to blame Bush for high gas prices than Republicans are to blame Obama now.” And the difference is more than minor: “73 percent of Democrats thought Bush could do something to reduce gas prices, while only 33 percent (of Democrats) think Obama could — a 40-point shift. By contrast, 47 percent of Republicans thought Bush could help bring gas prices down, compared with to the 65 percent who think Obama could — only an 18-point shift.”

In other words, if you ask someone whether the president can affect gasoline prices, Democrats are far more likely to change their answer depending on who occupies the Oval Office. And as everyone knows, liberal Democrats outnumber conservative Republicans in the media by a ratio of something like 8 gajillion to one.

Setting aside partisan politics, the truth is that the president really can’t do much to affect prices at the pump. More drilling — and good tire inflation — might make a marginal difference. Higher fuel-economy standards can help, too, although they create a boomerang effect (a lower marginal cost per mile encourages more driving).

On the whole, though, such policies don’t matter much when — as Obama has pointed out — the number of cars in China has tripled in just five years. The effect on global oil prices from soaring demand in China, India, and other emerging economies will overwhelm just about anything the U.S. can do at home.

That’s Econ 101 — and a lesson the media seem to have grasped. We’ll see how good their retention is the next time a Republican moves into the White House.

This column originally appeared in the Richmond Times-Dispatch.

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  • Jon Lester||

  • OldMexican||

    my classmate's step-aunt


    Wait - step-aunt?

  • some guy||

    Step-parent's sister. Keep up, OM. Families are getting more and more extended these days.

  • Anomalous||

    She has a webcam and takes loads to the face?

  • Bobarian||

    If you're gonna make 16 grand a month, you gotta be kinkier than that. You can get that shit for free.

  • Inigo M.||

    Right. More like she has her own load and takes webcams in the face.

  • ||

    "Under my plan energy prices would necessarily skyrocket..."

    Outstanding.

  • thom||

    It's counter intuitive. If Obama can give us free health care, why can't he give us free gasoline?

  • Doctor Whom||

    Health care is a right, not a privilege. Cars are icky. [/prog]

  • Inigo M.||

    Are the free Obama cell phones also a privilege then? Or would a prog consider cell phones to be icky -- even when it's not Anthony Weiner's cell phone?

  • Drake||

    I think he has done enough.

  • Jon Lester||

    Europeans have high gas prices because they don't want their cities to look like Atlanta and St. Louis, and because they can serve most of their populations with public transportation. Here, we have too many people living in places like Wyoming and Utah, where distances are often reckoned in hours rather than miles, so new federal fuel taxes should not even be considered.

  • Mike M.||

    This is sarcasm, right?

  • UnCivilServant||

    The BBC did an article on the price of petrol at the pump and how the price broke down. I ran their numbers against the numbers I had for US gas prices, and found that 100% of the difference was in tax. The base price of gas was the same, but there was a crapload more tax on the English fuel, incuding a VAT that included charges on the Excise tax. (Yes, a tax on a tax).

    Of course this was an unscientific survey using data taken from the NYS Department of Tax and Finance on how much the fuel excise in New York amounted to and comparing it to a government broadcaster's dataset, but I'm still confident that the base price parity element was accurate.

  • Adam330||

    The only likely differences between gas prices in different places are: 1) transportation costs; 2) uncompetitive markets; 3) taxes; and 4) other regulations restricting competition or raising the price of delivery/sale. There's not much reason to think 1 or 2 explain the difference between US and Europe, so it's really go to be 3 and 4.

  • Jon Lester||

    I think Europe and the US have roughly the same refining capacity, so you would be right.

  • PD Quig||

    Anybody know if Europe has as many different gasoline blends required? One of our biggest costs and the cause of many supply shortages is that the US has state-based blend requirements and seasonal variations thereto. Does the EU has multiple standards?

  • PD Quig||

    have multiple standards?

  • Homple||

    The differences between Paris and Atlanta, Munich and St. Louis have, shall we say, causes other than differential rates of gasoline taxes.

  • Jon Lester||

    Paris and Munich demographics are not as homogeneous these days as you seem to be implying.

  • some guy||

    He could also be referring to the fact that population densities in and around these cities are very different. Also laws, taxes and regulations are certainly very different.

  • Free Society||

    Paris and Munich demographics are not as homogeneous these days as you seem to be implying.

    a progressive mind on display. someone makes an ambiguous claim and without hesitation you choose that implication.

  • Redmanfms||

    a progressive mind on display. someone makes an ambiguous claim and without hesitation you choose that implication.

    Homple is a racist, it's likely one of American's socks.

  • OldMexican||

    Re: Jon Lester,

    Europeans have high gas prices because they don't want their cities to look like Atlanta and St. Louis


    You mean prosperous?

    Here, we have too many people living in places like Wyoming and Utah


    Wow. "Too many." Those places sure sound crowded.

  • Jon Lester||

    I happen to have family in one of those states. We have "too many" people who would be unfairly burdened by new fuel taxes, which would most likely fund something to benefit urban centers in other states.

  • mad libertarian guy||

    We have "too many" people who would be unfairly burdened by new fuel taxes

    EVERYONE would suffer from new gas taxes. Even those who don't drive would have to pay higher prices for every good they buy which, of course, travels via some method which uses fuel at some point.

  • Jon Lester||

    People who have to deal with Atlanta traffic generally don't share your definition of prosperity.

  • ||

    The smart ones do. They figure out like I did how to make a good living while still avoiding the traffic.

  • gimmeasammich||

    By taking loads to the face?

  • Free Society||

    People who have to deal with Atlanta traffic generally don't share your definition of prosperity.

    So the problem of traffic congestion is that the government doesn't effectively put it's boot on the neck of motorist? As opposed to being the result of a poorly managed government transportation monopoly? I question your analysis skills.

  • Free Society||

    You think heavy handed tax collection equates to city beautification?

  • Johnimo||

    Europeans have high gasoline prices because the governments levy a petro tax, on top of which they add the VAT of about eighteen to twenty-three percent.

  • Inigo M.||

    So the obvious solution is for a major new government program to relocate those people from places like Utah and Wyoming and move them into densely-populated but well-served-by-public-transportation cities, right? While you're at it, you'll probably want re-education for those people you're moving. A two birds with one stone sort of thing -- sorta like Pol Pot had in mind.

  • Mike M.||

    Remember that there's no inflation though!

  • Almanian!||

    Is this what the Occutarders meant by "the 1%"?

  • Almanian!||

    Fewer people are blaming Obama than blamed Bush about gas prices?

    For this, I blame Bush.

  • Johnimo||

    And don't forget to blame Dick Cheney. He's from Wyoming and surely responsible for high prices, along with Bush.

  • Inigo M.||

    I thought it was that he used to be a Halliburton executive at some point in the past, which is an oil field services company that stands to benefit from higher prices -- ergo, he MUST have arranged for higher gas prices simply to benefit his former company. There can be no other explanation. "Follow the money" and all that. A perfect example of a prog's brilliant deductive reasoning.

  • Atreides||

    "The media is either economically illiterate or deliberately biased on the matter."

    Why not both?

  • Anders||

    Ever think that Unicornhole likes high gas prices? Keeps you peons in your place.

    We don't want you people having guns, privacy, or easy private means of transportation.

    All of this makes it harder to administer the utopian totalitarian state comrades.

  • Mainer2||

    Which is why the progs love trains.

  • Anders||

    All about Control, All the time.

  • The Late P Brooks||

    I would just like to take a moment to address everyone, everywhere, who believes the President can or should actively manipulate the economy.

    STFU

    GTFO

  • Alan Vanneman||

    Gas prices have "soared"? Please. Gas prices are lower today than they were in 2008 and have been at basically the same level since mid-2011, after recovering from the collapse of Nov. 2008. When whining about "the media," A. Barton, it's usually considered bad form to frame the "facts" in a disingenuous manner. This is well below your average.

  • BLEEDINELL||

    Where were you buying your gas? Gai Paris?
    Gas was $2.09 here in Oct 2008.

  • UnCivilServant||

    I got my current car in 2007, I was paying about $2 per gallon then. I moved to Eastern New York in 2008. Gas was $3. Since then, gas passed $4 and has been bouncing between $3.65 and $4 of late.

    Where do you buy your gas?

  • Marshall Gill||

    Vanneman is simply a billboard. He only posts in the hopes that you will follow the link in his name to his shitty blog. He isn't even trying to make sense or be accurate, about like the Spambot, only more stupid.

  • Redmanfms||

    Vanneman is simply a billboard. He only posts in the hopes that you will follow the link in his name to his shitty blog. He isn't even trying to make sense or be accurate, about like the Spambot, only more stupid.

    This. I don't think I've ever seen him respond after one of his drive-bys.

  • thom||

    At one point in 2005 or 2006 gas was well over $4/gallon.

  • KDN||

    I paid $4.80 per gallon for Premium in central PA just after Katrina. Those weren't fun times.

  • UnCivilServant||

    I don't have data from that time as I lived close enough to work to not need a car.

  • thom||

    It must have been around then, yes. If you adjust $4.80 in 2005 $ for inflation you get $5.74 in today's $.

    That was the only time I actually remember the price of gas being a factor in whether I would do certain things that involved driving.

  • EDG reppin' LBC||

    Hinkle never made that assertion, dickhead.

    "Gasoline prices are skyrocketing, as many news reports attest."

    You can't read too good, can you?

  • OldMexican||

    Re: Anal Vaneman,

    Gas prices have "soared"? Please. Gas prices are lower today than they were in 2008


    Technically right, but that is not what the article is saying. The author is not arguing that gas prices are higher today compared to 2008, only that news reports are stating that gasoline prices are soaring. The graph I link to confirms that veyr fact. In the middle of a recession that has NOT ENDED, prices are going up much quicker than back during the Bush years, which translates to inflation.

  • Inigo M.||

    One of these days Anal Vaneman should get together with Palin's Buttplug.

    Then again, that's probably a terrible idea.

  • FYTW||

    PB seems pretty far up AV's ass already.

  • Eitan||

    Actually, that fact was in the article. He said gas prices went up 180% under Bush, then collapsed in 2008 to pre-Bush levels, then doubled under Obama. Doubling = 100% < 180%. Not hard math...

  • BLEEDINELL||

    Oil companies make about 7% profit.
    Drug companies make about 21%.

  • Dweebston||

    Drugs Profits are bad, mmkay?

  • some guy||

    This is one of my favorite websites. Whenever a politician complains about the profits an industry is making I head there to check it out.

  • BLEEDINELL||

    Great site, thanks.
    I'm off to buy a TV station.

  • mad libertarian guy||

    Oil companies make about 7% profit.
    Drug companies make about 21%.

    And the government makes more than both on both.

  • BLEEDINELL||

    Yup, gives you a warm and fuzzy doesn't it.

  • ||

    Since Obama took office they have doubled: Gasoline prices stood at $1.72 per gallon in January of 2009 and last month averaged $3.48.

    While I would expect the January and July prices would look very different, it's shocking that, according to AAA, the average price of gas in January 2013 was $3.32. The lack of difference between last January's price and this summer's price is pretty shocking.

  • OldMexican||

    Before being appointed, Obama's first Energy Secretary, Steven Chu, said, "We have to figure out how to boost the price of gasoline to the levels in Europe." Yet when gas prices rise, none of this seems to merit even a mention.


    Well, he did say "C'mon, guys! Did you really think I was being serious about it? It was all a big joke! You guys have no sense of humor! C'mon, guys!" while being led outside to the sidewalk with pencil cup on hand...

  • Troglodyte Rex||

    He also said we could paint our roofing shingles white to lower the effects of greenhouse gases.

  • OldMexican||

    The effect on global oil prices from soaring demand in China, India, and other emerging economies will overwhelm just about anything the U.S. can do at home.


    That's not the case, Mr. Hinkle. Oil is traded in the market in US dollars. The dollar has been suffering a constant debasement ever since 1985 but especially now with Q.E. 1, Q.E. 2 and Q.E. "The Sky Is The Limit." Stopping this process of debasement would defintively have an impact on oil prices in the long run.

  • MappRapp||

    Sounds like a solid plan to me dude.

    www.Privacy-Rox.tk

  • UnCivilServant||

    Who are you and what have you done with AnonBot?

  • mad libertarian guy||

    That’s Econ 101 — and a lesson the media seem to have grasped.

    In their defense, they don't teach much about economics is Grievance Studies courses with the exception that math is racist.

  • Inigo M.||

    Right. The idea that 2+2 can only equal 4 and nothing else was perpetuated by a bunch of old white dead guys in a cross-generational attempt to marginalize those who thought it might be also equal 3 or 5 or even 100. It's high time we moved past that to a more inclusive notion of arhythmtick!

  • Aloysious||

    Well, he can start by fucking right off.

  • John Galt||

    Gasoline prices too high? Nothing a few hundred more relaxing rounds of golf can't fix.

  • timbo||

    U.S. President BO Dwayne Elizondo Mountain Dew Herbert Camacho.
    I would rather have him than this Marxist moron.

  • AAnderson||

    "Setting aside partisan politics, the truth is that the president really can’t do much to affect prices at the pump."

    The quote above is the best part of your article.

    "Campaign for a Stateless Society" has plenty of good information on the realities of peak oil, renewable energy, and intellectual property (something key to the issue) from a left-market anarchist viewpoint.

  • Bean Counter||

    "The media is either economically illiterate or deliberately biased on the matter."
    Can't it be both?

  • GLK||

    The only reason the Proglodytes incessantly bitched about Bush's drill, drill, drill but are relatively quiet over Obama presiding over the highest gas prices in American history is because they WANT gasoline to be expensive. They WANT to punish everyone into submission. It's the way of the Progressive Liberal to WANT to destroy markets and make everyone bend to their will. Destructive cretins, all.

  • TexasRasta||

    The president can is the power of the federal government, from political appointees at the EPA or secretary of the interior etc... and use those agencies to restrict permits on federal lands. Federal rules and regulations make federal lands unavailable to many companies, particularly the smaller ones. The president can use executive privilege to do a lot in this country to restrict overall global supply. The US could be pumping 20 million barrels a day, if not for the cronyism that keeps the small guy out or the environmentalists ahead of the rest of the nation. The president has a lot of power affecting gas prices.

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