The Briefing: What’s the deal with gas prices?
- BREAKING: Gas prices are up lately
- How much that means in $ / year
- The average American consumes ~500 gallons of gas annually
- In 2019, that would mean ~$1,345 / yr.
- If current trends keep up 2022 gas could cost ~$1,800
- Everyone's pointing fingers
- House GOP leader Kevin McCarthy blamed President Biden, especially his cancellation of the Keystone XL pipeline
- Biden is keen to give Russian President Putin credit for the price hike
- Some Democrats have pointed to an apparent break between crude prices and pump prices as proof of corporate conspiracy
The Big Question: Who’s really to blame?
First of all, those quoted prices are probably different from what you’re paying, because every state has a different regulatory scheme which taxes gas differently. Living in California now, I sure wish sometimes I were back home in Missouri, where prices are about 30% lower. As an interesting side note, it turns out that in California—where gas taxes are among the highest—prices for premium gas are much closer to the national average than for regular. Thus, it seems like those high gas taxes are hurting poorer people with tighter budgets more than wealthy folks who can afford premium.
Setting that aside, let’s look at who’s to blame for all this. If you listen to President Biden and maybe take a more hawkish perspective, then Putin’s invasion of Ukraine is clearly at fault for these high prices. However, this is only partly accurate. Gas prices have been climbing fairly steadily since April 2020, but there was a pretty sizable and sudden price spike last month, which is hard to imagine not having anything to do with the war.
But what about that steady incline pre-invasion? Maybe McCarthy is right, and the cancellation of the Keystone pipeline has been a one-two punch against the budgets of the American middle and working classes. The only trouble is, Biden cancelled the pipeline in June of 2021. Prices had been climbing well before that, and there’s no perceptible bump anywhere around then.
Could it be true that ‘big oil’ is just lining its pockets? Well, yes, obviously, but probably not through conspiratorial price hikes. It may sound a bit like corporate nonsense when an American Petroleum Institute spokesperson says, “Retail prices in many industries go down slower than they go up—this isn't a new phenomenon.” But if you think about it for a second, it makes sense.
After a country like Russia, which in 2019 accounted for 10% of global oil exports, gets hit with the kinds of sanctions it did, it’s obvious that oil companies are going to panic. Prices are going to shoot up, because it’s not crystal clear what’s going to happen next. It’ll take some time for companies to get their bearings on the situation. Maybe prices will come down a bit, maybe a lot, maybe not at all.
The truth is, it’s quite hard to tell precisely who’s responsible for all this, but…
The Theory: It doesn’t actually matter.
Here’s the thing. Much as you might have read the above section and found yourself silently cheering or booing as I listed off the different sides of this debate (and, really, our political arena in general), everyone is wrong and nothing matters. Nothing matters except this—that Biden and the Democrats have the White House, the Senate, and the House of Representatives in their control.
It almost goes without saying that a good chunk of, probably most, voters won’t be moved one way or another by gas prices, unless things get a lot worse. Partisan preference has long been a sticky and reliable identifier in American politics, and our current moment is no different. If anything, it’s stickier and more reliable now in the post-Trump era.
But the state of the economy may come in second place for determinants of voting behavior. Research from 2020 by two academics seems to demonstrate as much. Especially in presidential elections, there’s a very clear correlation between low opinion of economic performance and punishment of the incumbent. When gas prices are seen as too high, voters are very likely to punish the sitting president.
On the one hand, “duh.”
But on the other hand, a lot of people might still look at that and think, “That’s pretty stupid.” After all, it’s obvious from the above that it’s not so cut and dry that the president is to blame for such problems. Global economies are complicated, and figuring out who to blame and who to hold accountable can be an incredibly challenging task, even for professional researchers.
The Takeaway: It’s not stupid at all.
Ask yourself, seriously, what democracy is about, on a fundamental level. Is it about individual rights and political liberties? Is it about the vote? Is it about economic freedom? In truth, it’s about all those things, but all those things are about empowerment.
Democracy promises power: to shape politics, to shape the world around you, to shape your own life. It’s the great distinction between it and every other form of government. Sure, one wants to be free, but one doesn’t want everyone else to be so free that one could end up enslaved, disempowered, and unfree. One wants to be powerful relative to one’s surroundings, powerful enough to feel secure and free. Politics is always about power; democracy just tries to share it with more people.
Gas prices present quite a challenge to people feeling empowered.
As we can tell, it’s profoundly difficult to even know who to hold accountable, let alone what to do about it. Even take for granted that ‘big oil’ profiteering is at fault. What’s one to do, vote with one’s dollar? Boycott the gas-pump? The idealist may scream, “yes,” but the suburbs and highways, even at a whisper, muster a much louder, “no.”
So you vote. Are the president or his party responsible for gas prices? It depends, more or less. But that doesn’t matter. Democracy promises power, and when you’re up against the apparently insurmountable wall of the vast global economy, you use the tools at your disposal—that you might feel powerful again. Sometimes that tool is the vote, and that’s not the least bit irrational.Subscribe to Spectacles