Gasoline Prices: ‘Nothing to See Here Folks’

Member Group : Jerry Shenk

In mid-2008, the average price of a gallon of gasoline briefly broke the $4 barrier before dropping back to $1.89, the price on President Barack Obama’s 2009 Inauguration Day.

In 2008, the American media reacted in nearly unanimous condemnation of Big Oil and the "oilmen in the White House." However, media coverage evaporated the instant the price of gasoline began to drop. Nothing to see here, folks, move along.

Today, that "nothing to see" media mentality applies to soaring gasoline prices on the watch of a president having a "D" rather than an "R" behind his name – no surprise given the ideological affinity much of the media have for this president and his party.

According to the Automobile Club of America, on Tuesday, Feb. 19, the pump price for regular gas had climbed daily for 32 consecutive days before reaching a then-four-month high. Beginning in mid-January, the national retail price for gasoline had risen 43 cents – 13 percent – to $3.73 per gallon. In fact, gasoline has cost more than $3 per gallon for more than two years, a record.

While there’s been modest media coverage of increasing fuel prices, there’s been a noticeable reluctance to blame the White House. The Media Research Center reported that, during the period Jan. 18-Feb. 5, when gasoline prices had jumped 24 cents, ABC, CBS and NBC cumulatively devoted only eight minutes of airtime to the increases. From the Research Center’s report: "Although the national average climbed to $3.56 on Feb. 20, setting a February record … there was far less coverage than in 2008."

Approaching election season, the Research Center covered examples of Obama’s protective media predicting lower gasoline prices even as prices were rising.
An Investors Business Daily editorial rightly observed: "(Gasoline price increases) are, in a strong sense, another form of taxation as they are a clear and predictable result of public policy. It’s a tax that’s more than doubled since Obama – who employed at least two Cabinet members who rooted for higher gasoline prices – took office. … And the media refuse to call him on it. It’s a gross disservice…"

Indeed, in a recent headline, the Washington Post called the soaring price of gasoline "mysterious," before examining market factors that could explain increases without fingering the administration – factors treated as irrelevant during the Bush years. However, the Post neglected to analyze or even mention how government policies affect markets, including petroleum markets, usually in negative ways.

The financial and credit crisis of 2008 plunged the nation into recession. The demand for oil and gasoline products – and their prices – dropped along with the economy. The recession officially ended in June 2009, though subsequent growth has been very sluggish largely due to the administration’s fiscal, financial and regulatory policies. Now, even in a flat economy, gasoline prices are increasing significantly under a president who has often expressed his antipathy to conventional energy sources. Obama’s former Energy Secretary, Steven Chu, infamously told the Wall Street Journal, "somehow we have to figure out how to boost the price of gasoline to the levels in Europe."

Having taken similar actions in 2009, 2010, 2011 and 2012, Obama will again blame – and pledge Federal Trade Commission punishment on – a group that has little effect on gasoline pricing, commodities traders, and ignore the actions that would lower petroleum costs: authorizing new domestic production, refining and pipeline capacity – and adopting sound monetary policy.

Among the policy choices affecting gasoline prices is the Fed’s decision to print new money and debase our currency to monetize America’s skyrocketing debt. In the absence of real growth, economic laws dictate that increasing the dollar supply cheapens all dollars, spurs inflation and forces consumers to spend more dollars to buy gasoline and other commodities. Grocery shoppers, too, haven’t missed that. Within the last several years, many of the items they purchase are being sold in packages/containers containing smaller quantities/volumes at the same or higher prices.

There will be consequences. Economist Mark Huffman writes: "It’s estimated that … every penny that fuel prices go up takes at least $1 billion away from consumers’ disposable income. Simply put, if U.S. consumers are putting more money into their gas tanks, they have less to spend at Walmart, or at grocery stores and restaurants. It becomes a drag on the economy and so, it’s no surprise that the economy begins to noticeably slow whenever gasoline prices go up."

It’s always better to fix the problems rather than the blame, but many media figures have willingly transformed themselves into Barack Obama’s court eunuchs by refusing to accurately report national problems and encourage public pressure to fix them on all of the parties most responsible for creating them.