Friday, May 02, 2008

Why are gas prices so high?

Excellent post by Brad from Sadly, No! (, giving a number of very legitimate reasons why gas prices are so high, why it has lots to do with poor energy policy of the past 20 years, and why the Clinton/McCain gax tax "holiday" is such a laughable idea.

As an aside, if I'm the Obama camp, I'm starting to use the "Clinton/McCain" line a lot more.


The truth is, we’re basically screwed in the short term and we have no one to blame but ourselves.

Why? Because we as a nation have:

Invested woefully small amounts in improving our rail and public transportation infrastructure - if you’ve ever stayed in Las Vegas, you know how well this has worked out.

Remained dependent on oil and coal instead of looking toward wind, solar and even nuclear power as good solutions where appropriate.

Done jack-squat to improve gas-mileage standards in our cars.

Allowed oil companies to write our national energy policies.

Decided for some bizarre reason that invading and destabilizing a major oil-producing country in the Middle East would somehow create magical oil ponies that would last forever and ever.

All of these stupid-ass decisions mean that our demand for oil and gasoline is highly inelastic in the short term - that is, we can’t reduce our consumption when prices skyrocket because no alternatives exist and we need it to get to work. The solution, of course, will come when we develop alternative fuels and admit to ourselves that destroying a national wildlife refuge just to get less than two years’ worth of new oil is not a sound solution. In the meantime, though, we’re just going to have to deal with the pain (and as someone who has a pretty long commute every morning, I know what the hell I’m talking about).

Also, I’d be remiss if I didn’t note at this point that none of this stuff is nearly as important as Barack Obama’s bowling score.

UPDATE: As justbrent notes in the comments, the sliding value of the dollar is also obviously a huge part of why we’re paying so much more for gas now than we did at the start of the decade. Also, rising demand from China and India means that prices are highly unlikely to go down at all in the future.

So we have to get off oil as soon as possible. It’ll obviously take some time, but having semi-sane political leadership will be a plus.

UPDATE II: From the Department of Grudgingly Acknowledging Credit Where It’s Due, I think the Mustache gets it right here:

It is great to see that we finally have some national unity on energy policy. Unfortunately, the unifying idea is so ridiculous, so unworthy of the people aspiring to lead our nation, it takes your breath away. Hillary Clinton has decided to line up with John McCain in pushing to suspend the federal excise tax on gasoline, 18.4 cents a gallon, for this summer’s travel season. This is not an energy policy. This is money laundering: we borrow money from China and ship it to Saudi Arabia and take a little cut for ourselves as it goes through our gas tanks. What a way to build our country.

When the summer is over, we will have increased our debt to China, increased our transfer of wealth to Saudi Arabia and increased our contribution to global warming for our kids to inherit.

The one flaw in this piece is that he seems to imply that “both sides” of the debate have been messing up our energy policy. As Rick Perlstein would say, that’s a “Notso!” The real problem is literally that we have a political coalition of wingnuts who are opposed to doing anything but sending more tax dollars to oil companies. That’s all they support, that’s all they want to ever do. That’s why the oil companies keep writing them big campaign checks.

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