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The Economics Of Gasoline

Business, climate change, County Government, Election, Energy, Government, Health Care, News, Politics, Presidential Politics, Reform, Religion, Smoking, taxes

It's the economy, stupid. It's the economy again. It's always the economy. The question is: what factor is most important to voters at any given election?

Gasoline prices have doubled since January 2009 President Barack Obama entered office. That was less than four years ago. Doubled. Has there been a corresponding increase in the price of everything else? Thankfully not. Has there been a corresponding increase to wages in the same period of time? We all know the answer to that.

But what is it about gasoline that gets our attention? Perhaps it is one of the few substances that is intertwined into the entire economy. If we don't all drives, somebody has to do it for us. If we don't obtain our own products from stem to stern, somebody has to drive them to a destination for us to purchase. It doesn't get much more basic than that.

For close to 40 years now, presidents have been trying to wean us off of foreign oil. On the whole, there hasn't been much progress. Can we drill our way out of this crisis? At first glance, we would think we could. If we listen to certain politicians, we can be talked out of that also. What is the president's energy policy? It does not seem to be one that would be steering us towards energy independence.

Since the Deepwater Horizon disaster two years ago, drilling for oil has become an enemy. We can't drill in Alaska-that would ruin the wildlife areas. The entire acreage, one would think. We can't drill in the Gulf of Mexico-that would pollute the shorelines again. Yet there is drilling being done on the Gulf. Companies from Venezuela and Brazil are being encouraged and license to drill in that area and President Obama is volunteering the United States to be their customer. Why can't we be customers of our own oil companies?

The president wants to end subsidies to the oil companies. At a time when were adding one and a half trillion dollars annually to the national debt, I may even agree with this. If the president has said that he is going to not only end the subsidies, he is intent on doubling down on investing in solar energy. Translation-were going to waste more money on Solyndra- like companies. To this – I am not a fan. The free market has again and again repudiated our desire to depend on wind and solar energy to produce electricity. It should be a market solution, it should not be forced upon us by the government. It certainly should not be forced upon us by a government intent on picking winners and losers. We've seen who the winners and losers are. The winners are the bumblers for the president's campaign and the losers are the American taxpayers.

It is been reported that in order for the economy to seriously consider switching to solar and wind power as a source of energy, gas prices would have to be $5-$7 per gallon. Is this part of the reason behind the recent spike in gas prices? No, we don't want to be gullible, but on the other hand I'm not so sure it can be discounted. The race to five dollar gas will certainly put us on the fast track for more investment i.e. more spending for companies that do not have the business sense to turn a profit.

Four years ago, when gas prices were spiking relative to the base price that Americans were used to pain, there was a lot of media coverage blaming the president and vice president for the recent rise in those prices. Was it because there were two oil men in the White House? If that were true, what's their excuse now? Yes, for this issue too, the causes are beyond the presidents grasp. Just like unemployment, just like the downturn in the economy, the president has excuses of external forces that are staying his hand in making America better for all people. Fortunately there are enough disasters for liberals to believe that things are on of our control. Just as a few years ago, it was the Japanese earthquake and tsunami, the Arab spring, and everything else, this year we have the unrest in Iran. It's just too bad we don't have leadership that can take control of enough of these situations and actually demonstrate effective leadership.

Yes, it's the economy stupid. But who's calling who stupid?
 

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