Bob Dole blames President Clinton for the recent runup in gasoline prices because Clinton tacked a 4.3 cents per gallon tax onto the 1993 budget deficit reduction bill. Congressional Democrats think an oil company conspiracy might be behind the 17% hike in gas prices this year, so the Justice Dept. is investigating whether companies violated antitrust laws through possible collusion. The President is grabbing headlines by announcing the sale of 12 million barrels of oil from the nation's strategic reserves.
Let's bring a bit of sobriety into what is passing for policy in Washington. Pandering in a political season makes rational discourse on energy nearly impossible.
There are four major reasons gas prices are going up. First, Americans have been binging on gas-guzzling sport-utes, minivans, and trucks. These brutes get a lot less mileage than ordinary cars. Second, the speed limit has been raised in most states. Thanks to public pressure, cars are zooming around at 70 miles per hour instead of 55, and that takes a lot more gas. Bye-bye, efficiency. Third, in case anyone has been in hibernation, the U.S. had a very long, cold winter. This delayed the usual shift by refineries from heavy heating oil to lighter gasoline. Fourth, refineries bet that Iraq would soon be allowed to export oil again by the United Nations, thus lowering the price. They delayed purchases.
Let's be honest. The current runup in gas prices has nothing to do with taxes or corporate collusion. In fact, falling futures prices already signal lower gas prices in the months ahead. But the price scare should remind Americans that they are using energy as if it were practically free, and it isn't. Oil imports are at record levels. They contribute significantly to the huge U.S. trade deficit and force the country to borrow billions overseas, increasing its foreign debt. Responsible politicians would use their bully pulpits to broadcast this message. Instead, Americans are treated to pandering.