Lies and Distortions: Gas Prices

This election year, as with every election year, the airwaves, cables and tubes have been filled with all manner of lies and distortions. It’s hard to know where to start, but one particularly inane nugget that has gotten under my skin is the price of gas. 

We are told that in the last four years gas has risen from below $2 per gallon to above $3.50 today, and we’re told it is due to Obama’s policies. This, of course, is dishonest at best.

It’s a lie on two fronts. First, gas prices were not low or falling, but rising steeply during the Bush years. Second, US Presidents have little direct impact on domestic fuel prices.

Ask someone when was the last time they paid less than $2.00 for a gallon of gas and they’ll probably say they don’t remember, or they’ll guess some time in the 1990s. The fact is, though, that gas sold for about $1.90 per gallon when Obama took office.

So why don’t people remember that? Because it only hit those levels in the last two months of 2008! Within months of Obama taking office the gas prices climbed back towards more "normal" levels. 

The implication and intent of those who are promoting the $2 per gallon meme is that the prices when Obama took office were normal and that Obama deserves blame for the price rise. Those are simply not true.

Prior to the tumultuous last months of Bush’s administration, prices at the pump vacillated considerably while increasing steadily over time. A chart of the Bush years shows gas prices rose steeply from 2002 to July 2008. In that time prices tripled from below $1.50 to nearly $4.50, in today’s dollars.

http://zfacts.com/gas-price-history-graph

Conspiracy theorists of the day blamed the rise to Bush’s close ties to the oil industry, while a more mainstream explanation was the Iraq war and related Middle East instability. The latter cause could clearly be seen in the record price of crude oil: $147 per barrel in July 2008.

Only when the financial crisis started to become clear, and the stock market went over a cliff, did the price of gas start to fall in September ‘08. And it fell steeply, along with the price of crude. By December 19^th, the day Bush approved a $17 billion federal bailout of General Motors, crude oil was selling at $40 per barrel.

Crude oil has rebounded over the last four years to just above 2006 levels, selling in the $100 per barrel range. Prices at the pump are around $3.50. Listening to the ads and pundits you would think current prices are unprecedented, when in fact they are much more normal than was the brief $2.00 gas of late 2008.

Those are the historical facts on prices. Under Bush, prices rose steeply and consistently. He left office with low prices, not because of his energy policies, but because of the global economic crisis. Obama inherited sub-two dollar gas – along with an unprecedented financial meltdown.

Tomorrow, is the President to blame for domestic fuel prices?