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?

Is This The Clueless Campaign?

Traditionally, this is the point in a presidential election year when very little happens.

The presidential nominees have been chosen. They just haven't been officially nominated at their parties' conventions. That will come in a couple of months.

What usually happens at this time in a presidential election year is, simply, the candidates take a little time away from the public eye. They might plot their fall campaign strategies or discuss potential running mates with their advisers, but they make very few public appearances (with the exception of some fund-raising events) and generally keep a low profile.

Well, that's what's been done in the past.

Today, presumptive Democratic nominee Barack Obama embarked on an 11-day tour on economic issues.

Many of the states that are expected to be the "battlegrounds" in this campaign have been targeted on this tour. Obama was in North Carolina today. Tomorrow, he will be in Missouri and Iowa. And he's scheduled to visit Florida, Ohio and Pennsylvania during his tour.

Gas prices keep going up. In nearly half of the states, the average price now exceeds $4.00/gallon. And I've heard that a majority of Americans believe the price will go past $5.00/gallon at some point this year.

We already heard from John McCain on the subject. He wants to drop the federal gas tax this summer -- which doesn't sound like a good idea to me. It amounts to -- what? -- 18 cents/gallon, which won't make much difference to the average consumer. But it's going to cut revenue that is earmarked for road maintenance, which probably means some people will lose their jobs and a lot of repairs that need to be done on our highways won't get done.

(And if those repairs somehow do get done, they'll get done on the cheap, which is almost the same as not getting them done at all.)

Hillary Clinton favored the summer holiday from the federal tax, too.

It's a bad idea, and Obama rightfully ridiculed her for it during the primaries.

It sounds -- to me, anyway -- like a bribe.

But is Obama offering anything better? If he is, I haven't heard it yet.

Today, he suggested slapping the major oil companies with a windfall profits tax. And using the proceeds to help the poor with their energy costs.

Kind of a Robin Hood policy.

Let's see. If my memory serves me correctly, we had a windfall profits tax in 1980 -- the final year of Jimmy Carter's presidency.

A windfall profits tax may temporarily satisfy the public's desire to punish the big oil companies. But it isn't likely to raise nearly as much money as Obama says it will, and it won't do anything to improve supply, if the past is any guide.

The 1980 windfall profits tax was projected to bring in nearly $400 billion in revenue, but it actually brought in about one-fifth that amount. And domestic oil producers reduced production in the United States.

It didn't work.

And it doesn't appear to me that either presidential candidate knows what to do about high fuel prices in 2008.

Even so, David Paul Kuhn writes in Politico that record gas prices can hurt McCain in the general election. With a Republican in the White House, it is clearly to McCain's advantage to propose a genuinely workable solution to the problem.

It is not essential for Obama, but it certainly would be reassuring for voters to see him engaged in a search for a long-term solution.

"Voters usually blame a poor economy on the party that controls the presidency," Kuhn observes, "and there are few more potent reminders of hard economic times than the high cost of fuel at the pump."