Pain at the Pump

Economists believe the recovery slowed as gas prices jumped in the first quarter of the year, writes Timothy Horman for Bloomberg.com.

I'm no economist, but I could have told you that. I've seen it before. The most extreme example, I suppose, was about three years ago, which was the last time gas prices were this high.

Barack Obama, as focused as he is these days on his re–election campaign, is clearly influenced by what is happening at the pump. His predecessor's approval numbers in his final year in office were never impressive, but they were at their worst when gas prices were at their highest.

I have no doubt that Obama remembers those days — and perhaps with some personal fondness. I don't mean that Obama was glad that prices went so high and, in the process, hurt so many people, but they did help him present himself as the anti–Bush during his last campaign — and Obama obviously would love to recapture the messianic feeling of that time. It propelled him to the presidency.

But now rising gas prices threaten to undermine Obama's re–election campaign, and he needs to project the image of a forceful president who is being proactive. Consequently, even though he himself has acknowledged that there is little, if anything, that a president can do to influence gas prices, he promised to form a task force to examine the situation and investigate whether something illegal was being done to take advantage of consumers.

Sounds good — except, of course, that it's nothing more than a P.R. stunt.

Obama is right when he says that out–of–control speculation is to blame. But excessive speculation is based on anxiety, not necessarily criminal intent.

In my opinion, a task force simply fuels (pardon the expression) the belief that someone out there is behind this.

The anxiety might ease if, as more and more people are suggesting, the situation in Libya is resolved. Libya itself produces a relatively small portion of the world's oil supply, but there are no oil producers who can make up even a small disruption in supply so, as long as the conflict in Libya continues, it seems likely to me that gas prices will remain high.

Some contend that America could make up for that disruption by drilling domestically — in Alaska or offshore. Again, I'm not an expert in these things, but there are at least two problems I can think of with that — there isn't enough oil in those locations to radically alter prices, and it would be years before the oil could be retrieved.

I've also heard talk of eliminating tax breaks for oil companies or adding a gas tax, neither of which seems likely to have much positive short–term impact.

If oil companies lose tax breaks, the most likely outcome, I believe, is that domestic production, not prices at the pump, will be reduced to make up for the lost revenue. And a gas tax is going to raise prices, not lower them.

Either of those (or a combination of the two) could provide funds for the development of alternative energy sources or mass transit expansion, but those are long–term solutions.

There are no simple answers in the short term.

Trumping the Presidency

I've seen this before.

Nearly 20 years ago, the economy was in a bad way. Not as bad as it is now, but still bad by contemporary standards, and many Americans were desperate for a president who could restore economic equilibrium.

I don't know if many of the people who voted for George H.W. Bush in 1988 did so because they believed he could handle an economic downturn. In fact, my memory of the 1988 campaign is that the economy really wasn't discussed at length — and, when it was, it was mentioned in terms that were favorable to Bush, who, as the incumbent vice president, sought to share in the credit for the things that were perceived as good about the Reagan presidency.

And one of those things was the strong economy.

Things turned sour during Bush's presidency, though, and, by 1992, America was caught in a recession. Americans were looking for a president who understood that "it's the economy, stupid" and would govern accordingly.

The person to whom many Americans turned in 1992 was a man who had demonstrated his ability as a businessman — Ross Perot.

Perot didn't take the nomination away from Bush. He didn't even try.

He did run as an independent. He didn't win the election, of course. He didn't carry a single state. But he captured nearly one–fifth of the popular vote. It was the highest share of the popular vote taken by a third–party candidate in 80 years.

You can still find some people who will tell you that Bush would have been re–elected if Perot had not been on the ballot — even though every exit poll I saw in 1992 said that about 20% of Perot's supporters would not have participated at all if he had not been a candidate and the rest would have been divided about evenly between Bush and Clinton.

Those numbers never added up to a Bush victory if it had been a two–man race.

I didn't vote for Ross Perot in 1992, but I always felt that I understood the reasoning of most of those who did. They believed that someone who had been a success in business would have special insights for dealing with a recession.

I didn't disagree that Perot had been remarkably successful in business, but I never felt that his business skills were applicable to the presidency. An entrepreneur does not have to at least try to resolve conflicts to everyone's satisfaction; his word is law. If two of his employees don't get along or if they disagree, he can reassign — or dismiss — one of them. Problem solved.

That isn't how it works in a democracy. A president who blithely dismisses Congress' input does so at his peril — particularly when one of the chambers just flipped decidedly to the opposing party.

Until last November's midterm elections, Barack Obama's party controlled both chambers of Congress. For awhile, the Democrats' margin in the Senate reached the elusive filibuster–proof 60. But that advantage disappeared more than a year ago. That makes compromise a necessary skill.

In a divided government, the ability to compromise is crucial, and Obama brought no relevant experience with him to the presidency. But neither would this generation's Ross Perot — Donald Trump — whose name is on everyone's lips, it seems.

After Perot ran unsuccessfully for president in 1992 and 1996, Trump toyed with the idea of running as an independent in 2000. But he didn't — ostensibly for several reasons, but I think just one was decisive. The economy in 2000 wasn't bad enough. The Clinton presidency had produced a budget surplus.

I think that tells you everything you really need to know. Still there are people who speculate about why Trump might get into the race this time.

At The Daily Caller, John Ziegler writes that Trump's rise in the polls is the result of a "celebrity–obsessed culture."

And Eugene Robinson's column in the Washington Post says the "birther" issue is fueling the Trump–for–president movement.

It's true that Trump has said he won't disclose his tax returns until Obama discloses his birth certificate — but, frankly, I don't think the "birther" issue is what's driving people to promote Trump for president. Nor do I believe a celebrity fetish is behind it.

It's the economy, stupid.

The Energy Information Administration, part of the Department of Energy, predicts gas prices will be up 40% over last year during the summer driving season. That isn't good news for folks who wanted to hit the road and get away from it all, at least for awhile, this summer — or the people who depend on summer tourism to carry them through the cold and bleak months of winter.

If there is good news to be found in that, it may be that gas prices are already up by about 33% over their level at this time last year — so the increase isn't likely to be as severe as what motorists have already experienced this year.

But no increase will be welcome. You'd think that Obama would be doing anything he can to boost the economy under these circumstances — a Washington Post survey shows that twice as many respondents say they "strongly disapprove" of Obama's handling of the economy as say they "strongly approve" — but he isn't, at least not with the sense of urgency one might expect.

Things are a lot worse in 2011 than they were in 1992, and a lot more voters may be receptive to what Trump has to say.

Philip Klein of the Washington Examiner warns that Trump is no Perot.

But to stressed–out consumers who are weary of waiting for the economy to turn around, it may not matter.

What's Logic Got to Do With It?

Robert Rapier of the Washington Post deserves credit for trying.

As gas prices have continued to go up, so has the general anxiety level of American consumers.

They heard what Ben Bernanke said about how this would be short–lived, but he's been criticized for overly sunny projections in the past (remind me again, how did his projections work out during the Bush years?) — and they can see how higher gas prices are affecting their personal budgets.

Uncertainty and anxiety begat scapegoats. It always works that way — and, as I say, Rapier deserves credit for his attempts to put out the fire with his piece about prevalent myths about rising gas prices.

But history shows he's fighting a losing battle.

I guess the best place to begin is in October 1973, when the Arab oil embargo occurred. The oil producing nations were only beginning to flex their political muscles at that time, and the price of a barrel of oil in those days (around $5) seems ridiculously low.

But it represented a 70% increase in the price of oil, and, for the first time, Americans began to feel financial pressure at the pump.

The president, Richard Nixon, paid a political price. His approval ratings — which had been in the 30s since it was disclosed that summer that previously secret recordings of Oval Office conversations existed and could verify what had been said — slumped into the 20s that October, and there they stayed until Nixon resigned the following year.

Nixon's dreadful approval ratings were hardly the fault of the oil embargo alone — but it certainly didn't help him.

The same could be said for Jimmy Carter and the 1979 energy crisis.

When 1979 began, Carter's approval rating was right around 50% — but he spent most of the rest of the year struggling with an approval rating in the 30s.

That is not the way any president wants to spend the year prior to seeking re–election.

There were other things that contributed to Carter's difficulties with the voters — and he did enjoy a brief resurgence when the U.S. embassy in Iran was captured — but the energy crisis clearly worked against him.

I believed he was right when he spoke to the American people about the long–term threat posed by our dependence on foreign oil. I thought he was being very logical.

But logic had nothing to do with it.

Rapier is right when he says a president has no influence on what consumers pay for fuel, at least not in the short term. A president's policies can have a long–term effect, but the results will not be seen overnight.

That's the logical way to look at it.

But what does logic have to do with it?

The Japan Syndrome

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Years ago, I went with my mother to see a movie called "The China Syndrome."

The movie — which starred Jane Fonda, Jack Lemmon and Michael Douglas — was about the perils of nuclear power. The title came from the popular misconception that, if someone in America drilled through the earth, he/she would come out in China. The movie's premise was that, if a nuclear reactor melted down, its core would do something similar.

It was a frightening premise that was made even more frightening by an actual nuclear accident at Three–Mile Island in Pennsylvania not long after the movie made its theatrical premiere.

That event gave the movie a lot of unexpected publicity, resulting in higher–than–expected ticket sales and a lot of anxiety on the part of the public.

We know more about nuclear power now than we did when that movie came out — but not, perhaps, as much as we may have thought — or, perhaps, would like to have thought.

In my adult lifetime, Americans have always seemed eager to embrace the simple solution to a complex problem, and many seem to be taking that approach to the nuclear situation in Japan.

"How bad could it get?" asks Josh Dzieza at The Daily Beast. And that's a fair question to ask — flippant though it may seem.

Barry Brook writes at Brave New Climate about the "misinformation and hyperbole flying around the internet and media" and asserts that "[t]he plant is safe now and will stay safe."

Well, time will tell.

Maybe it is the same mindset that always seems to assure Americans that higher gas prices are only temporary. In the past, yes, gas prices have declined after enormous spikes — but rarely, if ever, to the levels that existed before.

I'm not inclined to think that gas prices will fall to anything resembling what they were just a couple of months ago — especially now because the most vocal proponents of that particular pie–in–the–sky theory (that gas prices will decline almost exclusively on the basis of consumer behavior) also have been advocates of nuclear energy as the solution to the cost of heating and cooling our homes.

Those are the same people who scoffed at President Carter when "The China Syndrome" was at the theaters — because he warned that America's dependence on foreign oil was setting this nation up for disaster.

The recent events in Japan are sure to be mentioned now whenever someone promotes nuclear energy in this country. The issues that have been raised are far too complex to be addressed by a simple solution.

The truth is that, for all that 21st century humans know about nuclear power, there is still much they do not know — even in Japan, which, if anything, has been overly cautious about safety in just about every aspect of its existence when compared to virtually any other place on earth.

That is why you could watch video footage of the area nearest to the ground zero of the earthquake — and see large buildings that were still standing, even though a 9.0–magnitude earthquake struck the area 2½ days ago, and powerful aftershocks continue to strike.

Japan is no stranger to earthquakes. As a result, it has done a remarkable job of preparing its buildings for the possibility that one will strike, but this is the strongest ever to hit that country — and only the third earthquake globally to register 9.0 or higher in the last 50 years. One was the 9.2 earthquake that struck Prince William Sound in Alaska 47 years ago this month, and the other was the 9.1 that struck Indonesia the day after Christmas in 2004.

And this earthquake, along with the tsunamis it has produced, has been causing a number of unforeseen problems. Japan, as I say, always appears to prepare for the worst–case scenario — but its engineers didn't actually anticipate the worst case, only a worse case.

And that could have tragic consequences.

When you are dealing with something like nuclear energy, you must think way outside the box. I don't fault Japanese officials for not preparing for the size earthquake that almost never happens, but the fact remains that attempts to restart the cooling system at one of the damaged reactors have failed.

Safety standards have to be revisited — and, until we know more than we do about nuclear power, we have to treat it with the respect it deserves and prepare ourselves for a disaster that is much greater than anything we've seen — or may be likely to see.

Perspective

The average price for a gallon of gas in the United States went up 34 cents in the last 13 days, according to CNNMoney.com.

That number made me think.

When I was a child, growing up on a lake outside Conway, Ark., my parents always stopped for gas at the same bait shop/filling station, and the price of gas in those days was so stable that the sign out front never changed. In my mind's eye, I can still see it.

The price was 34.9 cents — for years and years and years.

And now the price of a gallon has gone up by that amount in less than two weeks' time.

Yeah, I know, 34 cents sounds really good to people who are paying anywhere from $3.18 to $3.86 per gallon (that's the current range cited by CNNMoney.com).

Remember — minimum wage was about a buck and a half in those days. Even so, though, it seems to me that folks had a pretty good deal when I was a child.

Let's say we're talking about filling up vehicles with tanks that can carry 15 gallons. Compare paying about $5 to fill that tank from a gross weekly income of about $60 — to paying about $50 to fill that tank from whatever the average gross weekly income is today (for those fortunate enough to be working and not looking for work).

Gas prices today are about 10 times what they were when I was a child — so, for things to be comparable numerically, I suppose, one's weekly gross income should be about 10 times that minimum wage figure from four decades ago — or about $600 a week.

That sounds like a lot of money — and it is. There were quite a few people who were making at least that much before the recession — but if you've been out of work for a couple of years and your unemployment benefits have run out, you'd probably settle for half that today and be thankful for it.

You wouldn't have much buying power, but you'd probably be able to keep food on your table and a roof over your head.

I long ago got used to the idea that the prices I pay for everything as an adult are higher than the prices that were being charged when I was a child.

But do they have to be so much higher?

Bad Craziness

When I was a teenager, I was a fan of the Doonesbury comic strip.

I recall reading a strip once in which the Hunter Thompson–inspired character, Uncle Duke, in a clearly hallucinatory state, slumped behind something and muttered, "Bad craziness," while some sort of bizarre creature hovered over where he had stood in the previous frame.

I don't remember the details — and they aren't important, anyway.

But "bad craziness" is what came to my mind when I heard that gas prices have hit a 28–month high.

That is true in spite of the fact that, as Sandy Shore of the Washington Post reports, "[O]il and gas supplies in the U.S. continue to grow and demand for gas is weak."

It's the same through–the–looking–glass sensation I get when I look at the monthly unemployment report.

Earlier this month, we were told that joblessness went down dramatically. But the number of jobs created was not enough to keep up with the growth of the working–age population.

Mathematically, it doesn't add up — until you realize that only the people who are receiving benefits are counted. People whose benefits have expired aren't being counted anymore. They may still be unemployed — and, in this economy, they probably are — but they aren't being counted.

And bureaucrats can congratulate themselves on lowering the unemployment rate — when, in fact, they have done nothing to lower the unemployment rate.

Bad craziness.

Likewise, it is bad craziness for gas prices to be at their highest level since the fall of 2008.

One would be tempted to blame the unrest in Egypt for the price spike. But, as Shore points out, gas prices have been going up since November — predating the revolt in Egypt (which, nevertheless, has contributed to the regional instability that has traders worried about disruption of production and delivery).

And how's this for news? Gregory Karp of the Chicago Tribune reports that prices "aren't likely to go down anytime soon."

Bad craziness.

The Silver Lining

At the end of this week, we'll get the next unemployment figures. Might want to start bracing yourself now. No matter what the jobs report says, I expect both sides to spin the heck out of it.

Personally, I don't expect much to get excited about on Friday. I was just reading in the New York Times that the ratio of job seekers to job openings is 6 to 1 — the worst it has been since the government started tracking it.

I figure that, if there is another modest drop in joblessness, it will prove to be a temporary lull, like the others. It will merely be evidence that the house is still burning down, just slower than it was.

For that matter, it could be a sign that some of those who were receiving unemployment benefits are no longer receiving them. Whether they got jobs would be beside the point.

Need a silver lining?

Well, it ain't much, but here goes.

Gas prices are down.

Yep, gas prices have been declining since August 7 — nearly two months now.

And, if there is anything good to be said about high joblessness, it is this: "Demand is down due to the recession and mounting unemployment."

Consequently, says Lundberg Survey publisher Trilby Lundberg, "there's nowhere for gasoline prices to go but down."

You aren't saving a fortune — about 12 cents per gallon. But that beats paying 12 cents more per gallon.

Doesn't it?

Passing Gas

According to the results of a visitor poll at the CNN.com website just after 4 p.m. (Central) today, about 85% of more than 340,000 respondents have no travel plans for the Memorial Day weekend. Apparently, a lot of folks are staying close to home. They may be going to a nearby park for a picnic or a nearby beach for some swimming or a friend's house for a cookout, but if they're going anywhere, they're going places within easy driving range of home.

I wonder if many Californians are traveling this holiday weekend. Gas prices in California are among the nation's highest, and the unemployment rate exceeded 10% several months ago.

You can relax a little, though. No one is suggesting that we will witness a repeat of last summer's $4 gas prices.

Even so, California's in a lot of financial trouble, but the special election this week didn't do much to resolve it. As the Los Angeles Times wrote this week, both liberals and conservatives can apply their own special spins to the results, but it's clear that program cuts will be necessary.

The Times didn't think the results suggested a philosophical shift. Intead, the Times suggested the vote reflected the influence of "high unemployment and scarce cash."

Still, the prudent thing for a Californian to do these days is keep personal spending down. If that is what a lot of Californians are doing this weekend, I wonder what that's doing to the tourist attractions sprinkled across the Golden State. Between joblessness and gas prices, there has to be less disposable income than those attractions are accustomed to.

Speaking of gas, Bonnie Parker and Clyde Barrow were known for the banks they robbed, but they preferred to rob gas stations and stores — I guess they were willing to swap the higher yield one could expect from a bank for a greater likelihood that there would be no security officers on the premises of a store or gas station.

Bonnie and Clyde, who lived in this area before launching their criminal careers, achieved something of a folk–hero status during their brief lives, which came to an end 75 years ago today when they were ambushed near their hideout in Bienville Parish, La. The six members of the posse fired approximately 130 rounds.

Here's an interesting piece of trivia. In Bonnie and Clyde's day, gas stations were called "filling stations." At least, I know that is what they were called here in Texas. I remember my grandparents, who lived in Dallas, always called them "filling stations."

My parents, who were small children when Bonnie and Clyde were killed, grew up with that phrase, but they must have been coming of age when the terminology began to change. So my memory is that they alternated between the two phrases until, at some point, "gas station" took up permanent residence in their heads.

Gas Price Gyrations

Last month, when Hurricane Gustav was bearing down on New Orleans and Hurricane Ike battered the Texas coast, we were told it would be at least a month before the oil refineries would be back to capacity.

The hurricanes did produce a spike in oil prices, but the trend has been reversed much faster than expected.

Here we are, less than a month after Ike made landfall in Galveston, Texas, and gas prices have been dropping for several days.

In fact, a spokesman for the American Automobile Association (AAA) says, "We're well on our way to $3 gas within the next week or two," according to CNN.

If you've lost your job or you're worried about losing your job, if you've lost your home or you're worried about losing your home, the fact that you're saving a few pennies on every gallon of gas that you buy may not mean much.

But it sure beats the alternative.

CNN explains the price drop this way: "As the global economy falters, demand for oil has dropped. And since the price of oil makes up about half of the cost of a gallon of gas, analysts see more relief ahead at the pump."

Well, what I know is this: The gas station in my East Dallas neighborhood is selling unleaded for $3.38/gallon. A few weeks ago, I was paying $3.78/gallon there.

That's change you can see.

And change you can see is change you can believe in.

Gas Prices Going Up Again

It's been less than 12 hours since Hurricane Ike made landfall in the Galveston area, and gas prices are going up again.

"According to a nationwide survey released by the AAA Saturday," writes CNNMoney.com, "the average price of regular unleaded gasoline edged up 5.8 cents to $3.73 a gallon, from $3.675 a day earlier."

Gas shortages are expected because so many Gulf Coast refineries had to shut down.

President Bush says federal officials are monitoring what's happening and will step in if it appears that anyone is trying to take advantage of the situation.

"[T]he Department of Energy, the Federal Trade Commission and, I know, the state authorities will be monitoring the gasoline prices to make sure consumers are not being gouged," Bush said in a brief televised statement this morning.

Last night, the Houston Chronicle reported that the severity of the storm would determine "[h]ow soon refineries can start back up, tanker trucks can fill up at terminals and new supplies reach retailers."

It's still too early to know when that will be.

But this much is for sure:

• One of the refineries is the #1 domestic supplier for the United States, and many of the other affected refineries play significant roles in U.S. energy supply.
• Production and supply experts were telling CNN this afternoon that, even if the shutdowns are temporary, it will be days, if not weeks, before they can get back up to normal capacity.
  
  The restoration of power to the region will have a lot to do with how long the refineries remain shut down.

For the distribution points that depend on those supply lines, it is said that $4/gallon gas is back on the horizon.

Blaming Big Oil

In an editorial headlined "Obama's Dry Hole," the Wall Street Journal dismisses Barack Obama's argument that the oil companies have been stockpiling leases on federal lands to manipulate gas prices.

Obama alleges that "68 million acres that have the potential to nearly double America's total oil production" have gone untouched.

"[T[he notion is obviously false — at least to anyone who knows how oil and gas exploration actually works," the Wall Street Journal says.

Then it applauds "liberals" for "finally acknowledging the significance of supply and demand."

I don't know if the Wall Street Journal is just noticing this (as many on the right seem likely to act these days), but the law of supply and demand isn't being "finally" acknowledged.

It is one of many factors that thoughtful progressives see as important (along with the need for conservation, the sense of urgency for finding reliable and renewable sources of energy and other factors) in the energy debate.

But "supply and demand" seems to enter the conversation these days (on both sides) with the accompanying question about "Big Oil" and its alleged role in all this.

Well, if you're going to insist on pointing your finger at someone ...

Newsweek's Robert Samuelson suggests a new culprit — the speculators.

"A chorus of politicians, including John McCain, Barack Obama and Sen. Joe Lieberman, blames these financial slimeballs for piling into commodities markets and pushing prices to artificial and unconscionable levels," Samuelson writes.

"Gosh, if only it were that simple," he continues. "Speculator-bashing is another exercise in scapegoating and grandstanding. Leading politicians either don't understand what's happening or don't want to acknowledge their complicity."

All the proposals I've heard for dealing with today's energy crisis seem to be based on the belief that there is a quick-fix solution out there to the reality of a finite supply of fossil fuels.

Whether the proposal is for a windfall profits tax (the logic behind the tax suggests that big oil is manipulating supply to inflate price, but such a tax is likely to restrict production and produce much less revenue than predicted) or a summer "tax holiday" (which would provide minimal — and temporary — financial aid to the consumer — while forcing state governments to cut their workforce — along with some important road maintenance projects), none of the "solutions" I've heard address the real issue of long-term energy needs — including independence from foreign energy suppliers.

So I guess, as Samuelson writes, the speculators are next on the blame list.

Isn't it time for our politicians to speak in depth about a long-term answer? I don't expect anyone to have the answer. How do we find it? That's the kind of vision we seek from our leaders.

We need a strategy.

What's the Answer for Gas Prices?

At a time when the price of a gallon of gas seems to go up every day and Americans have been paying more at the pump than ever for what seems to be a long, long time, it was inevitable that someone like National Journal's Amy Walter would describe the two major party presumptive presidential nominees' disagreement on energy policy as a "gasoline fight" -- evoking images of a raging fire that engulfs both men.

And that's what the gas crisis threatens to do to whoever wins in November.

The American public wants easy answers, like the ones they used to get from politicians. But the same old song and dance doesn't work anymore.

The tough choices didn't go away -- they just got tougher.

Today, President George W. Bush said he wants America to expand domestic oil production.

Bush correctly pointed out that high oil prices lead to high gasoline prices.

And prices have risen, in part, because demand has risen in India and China.

Well, we've outsourced a lot of jobs to those countries, and those incomes are pumping money into the Indian and Chinese economies now, not the U.S. economy. All those workers in India and China need transportation to work. And they want to enjoy some of the other benefits of more prosperity.

Which is why demand has increased.

And some people over here want to blame Indian and Chinese workers for needing more gas to do precisely what American workers have done for decades -- commute to work.

But the U.S. is still the leading gasoline consumer in the world.

Even though the American population is (seemingly) dwarfed by India and China.

The population in the U.S. is a little over 300 million. India has nearly four times as many people (1.1 billion), and China has a little more than four times as many (1.3 billion).

Just based on population figures, India and China each should be consuming four times as much oil as the U.S. Right? Well, the cultures are different, there are different levels of personal freedom in each country, but the fact is that India and China have done more to promote the idea of mass transit.

Bush wants to open part of the Arctic National Wildlife Refuge (ANWR) for oil exploration. And he wants Congress to halt a ban on offshore drilling.

Presumptive Republican nominee John McCain -- to re-phrase a famous John Kerry quote -- was against offshore drilling before he was for it -- as he appears to be now.

Senate Majority Leader Harry Reid of Nevada called it "a cynical campaign ploy that will do nothing to lower energy prices, and represents another big giveaway to oil companies."

Sounds like coded words of support for the other really bad idea on energy in this campaign, Barack Obama's recent call for a windfall profits tax on oil companies with the proceeds being used to help the poor pay high energy bills.

But, as I said a few days ago, drilling in ANWR or offshore is a short-term solution at best. And a windfall profits tax may make people feel better, but it won't improve supply and, ultimately, it won't raise the kind of money some people say it will.

What we need is a long-term solution. We have to stop pretending that there is a way to return to the way things used to be.

When McCain and Obama have finished preaching to their respective choirs and decide that they're ready to reach beyond their bases, maybe we can have a realistic discussion about energy policy.

So who's got an answer?

ANWR Isn't the Answer

"Imagine for a minute, just a minute, that someone running for president was able to actually tell the truth, the real truth, to the American people about what would be the best -- I mean really the best -- energy policy for the long-term economic health and security of our country," writes Thomas Friedman in a May 28 column in the New York Times.

Actually, I believe that did happen, in the summer of 1979, when President Carter delivered what was ridiculed by Republicans as his "malaise speech."

After saying that America was suffering from a "crisis of confidence" (which had been brought on by the severe inflation that was a result of OPEC's direct influence), Carter said, "I'm asking you, for your good and for your nation's security, to take no unnecessary trips, to use carpools or public transportation whenever you can, to park your car one extra day per week, to obey the speed limit, and to set your thermostats to save fuel."

He was asking Americans to do what it has taken $4/gallon gas to get them to do -- voluntarily reduce consumption. (And, by the way, Carter never used the word "malaise.")

That was 29 years ago.

And, in the roughly year and a half that Carter had left in the White House, he mostly tried to move the country in the direction of developing alternative energy sources.

Except when he yielded to political pressure and tried to offer a quick-fix solution in the form of a windfall profits tax to an electorate that didn't like what it was being told.

The American people, you see, didn't like to be told the truth then, and they don't seem to like it now, either. Yet that's what they continue to insist that they want.

But they don't want the truth. They want an easy, pain-free, quick-fix, tomorrow-be-damned answer.

Speaking of the quick fix ...

In the Washington Post more than a week ago, George Will wrote that we get the oil prices we deserve because of our refusal to drill in the Arctic National Wildlife Refuge (ANWR).

That opens the door for Will to complain about how "72 of today's senators ... have voted to keep ANWR's estimated 10.4 billion barrels of oil off the market." Both Barack Obama and John McCain were prominently mentioned as cuprits.

And the people who voted for the individuals who supported that policy in Congress are disqualified from complaining about today's high prices, Will said. "[T]hey should pipe down about gasoline prices, which are a predictable consequence of their political choice."

Will goes on to say, "One million barrels is what might today be flowing from ANWR if in 1995 President Bill Clinton had not vetoed legislation to permit drilling there. One million barrels produce 27 million gallons of gasoline and diesel fuel."

Supporters of drilling in ANWR, like Will, often say that the opposition to it is based on emotional appeals from wildlife groups (the "tree huggers," as they like to call the environmentalists).

(In fact, Daniel Henninger makes that point in the Wall Street Journal: "We won't drill for the estimated 5.6 billion to 16 billion barrels of oil in the moonscape known as the Arctic National Wildlife Refuge (ANWR) because of -- the caribou.")

But the truth is it isn't just the harm to the environment that makes drilling in ANWR a bad idea. That's a convenient argument, and it's one that's probably easier for most people to understand than complex economic concepts.

(That, of course, doesn't change the fact that drilling for oil poses a genuine risk to the wildlife in that region.)

While I'll admit that I am no economist, I don't think you have to be an economist to understand that drilling for oil in ANWR is really nothing but a short-term solution. The long-term answer lies in developing renewable energy sources.

Because the ultimate goal is energy independence. It affects everything else. Our addiction to foreign oil has led to simply disastrous decisions in, among other places, the volatile Middle East.

And, whether they want to admit it or not, Americans are helping to support our enemies in that part of the world with much of the money they spend on oil, even while Americans are dying in Iraq and, to a lesser extent, Afghanistan. That won't change until we face reality and develop different energy sources.

But that's going to take decades to achieve, whines Fred Barnes in Weekly Standard. We're going to need energy in the meantime -- to heat and cool our homes, to operate our vehicles, to maintain our lifestyle. So he encourages McCain to promote more domestic drilling.

"On this issue," says Barnes, "Republicans need McCain, and he needs them."

Americans are like the cocaine addict who can't accept the fact that his addiction to the drug supports dictators and rogue elements in South America.

It was time to start looking for alternatives 29 years ago, but America didn't want to listen to Jimmy Carter.

Now, Americans are desperately seeking a solution.

Well, ANWR isn't the answer.

Make the World Go Away

Eddy Arnold had a #1 hit with that song title more than 40 years ago. I must have been 5 or 6, but I vividly remember hearing it playing on car radios and phonographs wherever I went.

Arnold must have been nearly 50 at the time. He always reminded me of George Blanda, the seemingly ageless quarterback-kicker who was still playing -- in his 40s -- for the Oakland Raiders -- members of the AFL in those days.

Arnold died today, a few days from his 90th birthday.

He lost his wife of 66 years in March, then he hurt his hip. I've heard friends of his lament that he really died of a broken heart.

Or maybe the rest of us just needed to hear that song again. It doesn't seem to get much airplay anymore.

But 2008 is a good time for it.

This is a time when gas price increases are unrelenting. In case you haven't heard, a gallon of gas went up again today, once again setting a record. It costs, on average, $3.65 now -- and oil costs $124 a barrel.

In fact, the energy crisis has gotten so out of hand now that WRTV in Indianapolis reports that a near-riot broke out at an Indianapolis gas station where motorists had lined up to get gas at $3.55/gallon before the latest price increase was posted.

I guess $3.55 will seem like a bargain before too long.

And this is a time when pressure continues to build on Hillary Clinton to drop out of the race for the presidential nomination.

Former Sen. George McGovern, the Democratic nominee 36 years ago and a super-delegate who had previously pledged his support to Clinton, announced earlier this week that he was switching to Barack Obama.

McGovern urged Clinton to concede defeat and withdraw from the race.

I heard McGovern say that Obama reminds him of Abraham Lincoln. I have to wonder -- what is it about Obama, besides his Illinois address, that is reminiscent of Lincoln?

Frankly, I don't see the resemblance.

For that matter, do Democrats want to take their cue from a man who lost 49 states to Richard Nixon in 1972?

Actually, McGovern has a certain amount of experience with this sort of thing. Like Obama, he was an insurgent candidate who rolled up an early lead in the primaries, then weathered a series of wounds (inflicted by himself and others), including an "Anybody But McGovern" campaign waged by Democratic stalwarts like Hubert Humphrey and Ed Muskie who wanted to deny McGovern the party's nomination "for the good of the party."

Or perhaps for their own good.

Not unlike ... today.

In 1972, Humphrey and Muskie represented the past in the Democratic Party; McGovern represented the future.

Just as, in 2008, Clinton represents the past in the party; Obama represents the future.

Other than that, I guess, there's no real similarity between 1972 and 2008. Except for the fact that both election years featured unpopular wars.

But Nixon's handling of Vietnam, his phased withdrawal of the troops and the "peace is at hand" proclamation in the weeks before the election, bolstered the public's generally favorable opinion of his foreign policy.

And that made McGovern's task, against an incumbent president, that much more difficult.

Obama doesn't face an incumbent in 2008. But the incumbent party faces an increasingly frustrated and skeptical electorate.

Change is in the air. So why does Obama trail John McCain in public opinion polls? Shouldn't he be leading the Republicans' presumptive nominee?

Back in 2007, when the identities of the nominees were unknown -- and, if anything was being taken for granted, it was that Hillary Clinton would be the Democratic nominee -- polls showed a generic Democrat handily beating the Republican in the general election.

Today, we know the identities of the nominees, and the polls show the Republican leading.

Does this have anything to do with the divide between the so-called Starbucks Democrats and the Lunch-Bucket Democrats?

Is Obama perceived as too elitist to win the Lunch-Bucket Democrats, who have proven themselves to be reliable participants in elections over the years -- and who played a significant role in Republican victories in seven of the last 10 presidential elections?

Can someone make the world go away? Eddy Arnold isn't around anymore.

Recession or Slowdown?

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There seems to be some disagreement about whether the economy is in a recession.

Maybe it's a matter of semantics.

The Wall Street Journal reports, in its economics blog, that George W. Bush insists the country is in a "slowdown," not a "recession."

Well, whatever one calls it, the result is less money in my pocket.

Steve Forbes writes that he knows where the economy went wrong and how to get it back on track. (Do you think he wants to be McCain's secretary of the treasury?)

I'm hardly an economist -- although economists all seem to have a different idea about what will make a sluggish economy perk up, so I guess it wouldn't matter whether I actually agreed with anyone. (I think it was Harry Truman who said, "If you lined up all the economists end to end, they'd point in different directions.")

What this country needs is an economic strategy. But you can't execute an effective strategy if you won't admit that there is a problem.

A good place to start would be a real energy policy.

This afternoon, on my way home from work, I stopped to get some gas. I paid $10 and got about 3 gallons of gas. With any luck, that will get me to the weekend.

At the neighborhood gas station where I buy fuel for my truck, the prevailing rate is $3.45/gallon. Keep in mind that we haven't seen the price increase that usually accompanies the special blend for the summer driving season.

That should show up at the beginning of May. (In case you were wondering what to do with that rebate check -- whenever it arrives -- the oil companies apparently have a suggestion.)

To go along with the higher fuel prices, I'm paying more for food. In fact, it costs more to keep the basics on hand. Never mind a few of life's luxuries.

I'm not planning any road trips this summer -- long, short, or otherwise. Are you?

The Taste of Money

Nationally, the average price of a gallon of regular unleaded gasoline is $3.30. That's 7 cents more than it was last week, and it's 73 cents more per gallon than it was this time last year, when gas was selling for $2.57.

I'll admit that it may not help much to be told that gas prices in the United States still aren't as high as they are in most other countries.
That's because Americans simply aren't used to the prices they're having to pay.

It reminds me of when I was a child. We lived in rural Arkansas when I was growing up, a couple of miles from the town limits. And my parents were regular customers at a bait shop/gas station on the route to town. Gas had been selling there for about 29 cents/gallon for years and years. Then, it went up a couple of pennies per gallon.

The Arab Oil Embargo of the early 1970s led to fuel shortages in the U.S., the likes of which had not been seen since World War II more than a quarter of a century earlier. Although my parents complained bitterly about having to pay a few pennies more for a gallon of gas, we never saw gas prices that low again.

But, even though the oil price increases of the early 1970s seem mild by today's standards, the impact was severe enough at the time that forms of gas rationing were implemented in various states ... believe it or not.

It also may not help much to be reminded that, over the last three decades or so -- essentially beginning with President Carter in the late 1970s -- Americans have been warned that high prices for gasoline ultimately would be the result of not dealing with our dependence on foreign oil.

It's been nearly 35 years since the Arab Oil Embargo. And if one country seemed to prosper from the very start of its deprivation, it was Japan. Once chastised the world over for its reputation for manufacturing "junk," Japan recognized early that fuel efficiency and general construction quality would be important elements in automobile production in the future.

"Quality" was never just a buzzword for Japanese automakers, the way it has been for most U.S. automakers, who mostly cared about the quality of their profits. That led to Japanese automobiles that routinely outperformed their American counterparts year after year, whatever the prevailing price of gasoline happened to be.

Over the years, many Americans seem to have come to the conclusion that high prices for gas would decline as a part of the natural cycle of supply and demand.

But the recent increases in gas prices, which have sent rates well over $3.00/gallon, don't look like they're going to drop.

There are numerous steps that may be taken in the future to help Americans cope better with the higher prices. But long-term adjustments won't show up for awhile in the form of more fuel-efficient vehicles, or vehicles and homes that operate on fuel that we can produce in this country.

So, whether you refuse to rid yourself of a gas-guzzling vehicle or you're driving a fuel-efficient vehicle but still find it hard to pay the prices at the pump, I'd like to offer a few websites that are dedicated to directing your attention to the lowest prices in your area.

(By the way, if you're in the market for a new vehicle, do yourself a favor and read this from Forbes. It's about the top 20 most dangerous vehicles. Try to strike a balance between good gas mileage and road safety. Don't sacrifice safety for fuel efficiency.)

I'm sure there are other sites out there -- and I'm equally sure there will be more in the future. We haven't entered the peak driving season yet, and that seems almost certain to bring the price you're paying to $4.00/gallon or more.

But here are a few websites that may help you save a little while you plot your economic strategy to cope with the new reality.

And, as a bonus, here's a link that will answer your questions about how gas prices go up or come down. Don't blame the neighborhood retailer. The retailer is caught in a squeeze, too. The huge profits are being made elsewhere.

• Current Gas Prices and Price History (zfacts.com)


• Gasbuddy.com


• Fueleconomy.gov


• Gas Prices (Mapquest)


• Gas Prices (MSN)


• GasPriceWatch.com


• U.S. Retail Gasoline Prices (Dept. of Energy)

Trying Times

Today is the fifth anniversary of the start of the Iraq War.

Usually, anniversaries are occasions for celebration. And the fifth is a milestone.

For those who are responsible for getting America ensnared in the mess in Iraq, it's more of a millstone than a milestone.

Some of the people who are responsible are no longer in power (i.e., Donald Rumsfeld, Colin Powell). Others -- George W. Bush, Dick Cheney, Condoleezza Rice -- are still in office.

Bush gets regular reminders of what the public thinks of the Iraq War. They're called approval ratings. And Bush's approval ratings have tumbled about 40 points since the war began. That's roughly equivalent to the drop that Lyndon Johnson faced at a comparable point in the Vietnam conflict.

Oddly, it appears Bush was the only one who seems to have been saying much about the war today. Attention seemed to be focusing on Barack Obama's speech about race and Hillary Clinton's insistence that Michigan and Florida should be represented at the Democratic convention.

And people who weren't paying attention to Obama and Clinton were obsessing over Eliot Spitzer's call girl and the recently discovered video tape of her "Girls Gone Wild" auditions from 2003, when she was 18.

Arizona Sen. John McCain, who, as the Republican nominee, will have to run with Bush's record and persuade Americans to support four more years of a Republican-controlled White House, had this to say: "America and our allies stand on the precipice of winning a major victory against radical Islamic extremism. ... Important political gains have also been made, but far more must be done in coming months to cement the gains made in huge cost in American blood and treasure."

Approval ratings for Bush and Congress are quite low. Gallup says Bush is at 32% , while Congress' approval rating is 21%.

But neither figure should be surprising, and the Iraq War isn't solely to blame for it.

Also according to Gallup, the percentage of Americans who now believe the U.S. economy is in a recession is 76%. That's more than twice the number who felt that way in October.

It's hard to argue the point. In October, the consumer wasn't being told that each day brought a new record high in the price of gasoline. And record gas prices mean higher costs for transporting everything. That means everything you buy costs more.

You don't have to be an economics major to figure that out.

This belief about the economy was already prevalent when Bush paid a visit to the Economic Club of New York last week. If you watched his speech -- or clips of it on the evening news -- and kept one eye on the front page of the daily newspaper, you had to wonder something.

Why was that man smiling?

"That idiotic 'what me worry?' look just never leaves the man's visage," writes Robert Scheer for Creators Syndicate. "Once again, there was our president, presiding over disasters, in part of his making and totally on his watch, grinning with an aplomb that suggested a serious disconnect between his worldview and reality."

Gail Collins wrote, in the New York Times, that listening to Bush's speech to the Economic Club "brought back many memories. Unfortunately, they were about his speech right after Hurricane Katrina, the one when he said: 'America will be a stronger place for it.'"

It's not encouraging when a presidential speech to the Economic Club of New York brings back memories of the greatest natural disaster in American history and the nation's mostly anemic emergency response to it.

So why was Bush smiling? Maybe because he realizes these won't be his problems anymore in about 10 months.

Or maybe there's a little more to it than that.

"Failure suits him," says Scheer. "It is a stance he learned to wear well while presiding over one failed Texas business deal after another, and it served him splendidly as he claimed the title of president of the United States after losing the popular, and maybe even the electoral, vote. It carried him through the most ignominious chapter of U.S. foreign policy, from the lies about Iraq's weapons of mass destruction to his unprecedented defense of torture by a U.S. president."

Collins puts it this way.

"The country that elected George Bush -- sort of -- because he seemed like he’d be more fun to have a beer with than Al Gore or John Kerry is really getting its comeuppance. Our credit markets are foundering, and all we’ve got is a guy who looks like he’s ready to kick back and start the weekend."

Actually, he's probably ready to kick back and start his retirement.

"Everyone here is flummoxed about why the president is in such a fine mood," says Maureen Dowd, also in the New York Times.

"The dollar’s crumpling, the recession’s thundering, the Dow’s bungee-jumping and the world’s disapproving, yet George Bush has turned into Gene Kelly, tap dancing and singing in a one-man review called 'The Most Happy Fella.'"

The ghosts of Herbert Hoover and the Depression are hovering over the campaign of 2008, writes Amity Shlaes in Bloomberg.

"[T]he 1930s have plenty to tell us, yes," says Shlaes. "But the real challenge isn't deciding who resembles Hoover. The challenge is for both parties to figure out how to avoid a whole era of mistakes."

And the challenge for voters is to find who has the answers we need before today's problems become a decade's worth of financial handicaps.

Or maybe we'd be better off with Alfred E. Neuman at the controls.

Gas Prices Going Up

The Lundberg Survey reports that the national average price for a gallon of unleaded gas went up 5 cents in the last two weeks.

But that nickel increase will pale in comparison to the increase that's coming. The price of crude oil went up 18 cents in the same two-week period, but that increase hasn't been felt at the pump because it hasn't been passed along yet by refiners, marketers and retailers.

So fill up at the best price you can get right now, because it isn't going to last.

The national average was $2.80, which is 60 cents higher than it was a year ago at this time. The best price to be found was in Newark, N.J., where a gallon was selling for $2.56. San Francisco had the highest price, at $3.17.

Here in my east Dallas neighborhood, the price ranges from $2.61 to $2.65.

Gas Prices

You may have noticed a slight dip in gas prices at the pump lately.

Don't get too excited. In the last couple of weeks, prices dropped an average of 4 cents a gallon. And, while that's good news, it loses its luster when you realize that gas prices were about 47 cents lower per gallon at the same time last year. And the Lundberg Survey's publisher, Trilby Lundberg, warns that this does not represent a "trend for the future."

Nationally, the average price of a gallon of regular unleaded gasoline was $2.75. The best price to be found was in Newark, N.J., where that same gallon cost $2.52. The highest price was in Honolulu, where drivers could expect to pay $3.09.