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| When You Scoff At Newt’s $2.50 Gas Promise, You Scoff at History. Posted: 04 Mar 2012 01:14 PM PST Newt Gingrich has caught quite a bit of heat for his claim that he would, as President, help get the price of gas down to $2.50. His plan is pretty simple. He wants to increase domestic drilling, begin construction of the Keystone XL pipeline, and take a giant machete to the EPA’s job-killing, price-increasing regulations on the production of domestic energy. But even those simple steps have drawn little but dismissive derision from the bureacratic class and prominent Democrats. Mitt Romney, favorite candidate of the professional Republicans, jumped on Newt’s plan with a barely-disguised scoff and used many of the same arguments. He said he would not “pander” to voters by setting, as Newt has, a certain price for gas in the future. Here’s a good summary of the criticism from CNN.
Both of those arguments are ridiculous and I can prove it with a couple charts and a few simple links. Here is a chart of gasoline and crude oil prices that goes back four years. It’s tracked by the GasBuddy site, which tracks gasoline prices from all over the country. If you want to know what gas costs in your area, GasBuddy is there for you. And no, I don’t work for GasBuddy, but it’s a terribly useful site if you want to scout out gasoline prices in your burg, or elsewhere. Notice that little gap between 6/4/2008 and 7/25/2008. At that point, gasoline hovered around $4.00 a gallon nationally, and crude oil was at nearly $150 a barrel. Then something happened, very close to July 25 that drove the prices of both down to the point that, by the beginning of 2009, gas cost less than $2.00 a gallon. Something happened to drop the cost of a gallon of gas about $2 a gallon. What could have happened? Well, how about this?
A few months after signed his executive order, President Bush signed legislation to lift the decades-old moratorium on offshore oil drilling. Now, follow that little blue arrow. President Bush signed his executive order on July 14, 2009 at which point prices dropped to about $3.50 a gallon. They dropped slightly, blipped upwards a bit, then dropped off the table as Congress debated, and finally passed, the legislation which ended the offshore exploration moratorium in late October. The President signed it into law and gas prices continued to drop through the rest of the year. But what happened after that? Well, let’s look at this timeline, and use this chart for reference.
The big blow came on December 1, 2010 when President Obama slapped a new moratorium on drilling over many, of not most, of the areas the Bush administration had opened just a year earlier. You can see what happened to the price of gasoline after that. So, you still think, as CNN dismissively wrote, “there’s little politicians can do to influence the price of gasoline in the short-term”? It looks to me as if there’s quite a bit politicians did do and there is every reason to believe that we would see a similar drop in gas prices if the politicians in Washington decide to allow us to get the trillions of gallons of oil we and the rest of the world know are in areas Barack Obama has specifically placed off-limits. I want to make one more point here. When George Bush signed that executive order and when Congress lifted the moratorium, gas prices dropped even though we had not pumped one drop of oil from those newly-opened areas. The very idea that the United States would tap its immense oil wealth — put into motion with a concrete government action — caused the worldwide markets to move. Does anyone really believe that could not happen again? Remember, gas prices dropped well over $2.00 a gallon in four months in 2009. Newt Gingrich’s plan would only drop prices by $1.50 or so and he’s given no particular deadline for when that would happen. If it takes a year, that will mean that would have taken three times as long to do less than the Bush administration did. That does not strike me as “absurd” “political rhetoric” not a “pander” but a realistic goal with reasonable plans to back it up.  |
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