Political Gumption and Gasoline Prices
Chaos in the Middle East and the subsequent spike in prices at the pump spotlight the failure of long-term American energy policy. Reminiscent of the seventies, we are, once again, held captive by others’ instability. Just the potential tanker delays through the Suez Canal caused a price spike-and, that was before region-wide rebellion and production disruptions were reality.
Muammar Gadhafi’s announcement that he would sabotage his own country’s oil infrastructure in effort to retain control caused a thirty-month high in oil’s rising prices.
While much of Libya’s oil goes to Italy, any disruption in supply impacts prices worldwide. For example, the brief repair-related closure of the Trans Alaska Pipeline in January (representing only a small percentage of our entire US output) resulted in a four-dollar-a-barrel/two-cent-a-gallon jump-no geopolitics were involved.
Unrest in the Middle East is threatening the fragile US economic growth. Higher gasoline prices cause an overall drop in consumer spending. Predictions topping $4-a-gallon are resulting in fears about the teetering recovery.
If the supply of oil is steady and secure, the price at the pump is lower. Yet, President Obama is not helping. He could, and should, encourage domestic energy development. With one simple gesture, he could stop-or, at least, slow-oil’s steady climb.
Remember the last time prices spiked dramatically? It was Friday, July 11, 2008. They were $147.27 a barrel and, even accounting for inflation, have never been higher-before or since. On Monday July 14, prices began a descent. What stopped the increase? What changed the direction?
Monday, July 14, 2008 President Bush signed an executive order reversing his father’s 1990 ban on offshore drilling. The signature did not change the flow of oil, but it did signal a shift in political will. On September 23, 2008, then-Speaker Pelosi announced that Congress would allow the offshore drilling ban to expire. Then-Representative Rahm Emanuel called President Bush’s action a “political stunt,” but the economic benefit was global.
Today, President Obama doesn’t have to sign a thing, he only needs political gumption to influence gasoline prices. One call to Interior Secretary Ken Salazar, “drill here, drill now,” and energy prices and unemployment would be down. If only he had the political gumption, he could lower gas prices. Despite an internal memo to the Secretary saying, “a six-month deepwater-drilling halt would result in ”lost direct employment” affecting approximately 9,450 workers and ”lost jobs from indirect and induced effects” affecting about 13,797 more,” the ban was enacted, thrown out by a US District Judge, and then, reinstated with only minor word changes. That ban expired November 30th, 2010, but the Administration is still holding back energy production, real jobs, and economic recovery to the point that on February 17th, the US District Judge has ordered action on pending offshore drilling permits-calling the situation “increasingly inexcusable.”
The Administration is also ignoring the report from the Oil Spill Commission’s chief counsel. As the result of one bad actor, the entire industry, Gulf of Mexico, all of America, and even the world is being punished. It is like stopping all flights indefinitely because one airline has sloppy policies regarding pilot rest times. Far more deaths occur from plane crashes. Investigations are held while flights-and the economy-carry on.
Push for political gumption, not just from President Obama, but from the usually mild-mannered, Chairman of the Senate Energy and Natural Resources Committee: Senator Bingaman. In early March, he’ll be heading up hearings where Secretary Salazar will have to defend his choices. Hard questions must be asked: “Why have you ignored the reports?” “Why are you letting politics speak louder than the economy?” “Why are you punishing all of America?” Senator Bingaman has been an advocate for drilling in the Gulf. His aggressive actions are needed now more than ever!
Remember 2008 and $4+ gasoline. Low-key charm and a lack of leadership are not what we need today. We need those with the political gumption to stand up for an “all of the above” American energy policy. Instead, our elected officials are taking the easy way out by making the responsible energy that fuels the economy a scapegoat. Tell your Senator, Senators Bingaman and Murkowski (Ranking Member of the Senate Energy and Natural Resources Committee), and President Obama to lift the de facto ban on drilling in the Gulf, create real jobs, and lower gasoline prices. While you’re at it, tell them to allow modern, responsible, hi-tech access to America’s natural resources.