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Romney Punctures Thune-GOP Gas Price Propaganda

David Lias nicely dissects Senator John Thune's deceptive decrials of rising gas prices. Of all possible numbers, gas prices are the one economic indicator posted prominently in every town in America (well, except for Norris, South Dakota, where apparently you can't keep a gas station open without also resorting to the culture-wrecking force of alcohol). When we see gas prices everywhere, politicians can too easily associate them with everything.

(Just curious: how might our lives and economic perceptions be different if we posted the unemployment rate and GDP on the corner of Main Street in every town in America?)

Perhaps Senator Thune should take a cue from his pick for the White House, Mitt Romney. The eventual nominee said on CNBC Wednesday that "I think people recognize that the president can't precisely set the price at the pump." (Funny that Romney couldn't just state the facts without running it through the filter of both his opinion and the recognition of people in general... but then that inflated rhetorical structure perhaps indicates something about Romney's conditioned responses.)

Lias cites Rob Perks, who makes Romney's point more forcefully:

The fact is, as a global commodity, gas prices rise and fall due to a number of factors: crude oil prices, refinery capacity, increasing demand and political unrest in oil-producing countries. It seems like some people think the Constitution guarantees Americans the "right" to cheap gas, but the only price that is right is whatever the market will bear. That's why no president can control what we pay at the pump. Any politician that says otherwise is trying to sell the public snake oil [Rob Perks, "Empty Promises, Empty Gas Tanks," National Resources Defense Council: Switchboard, 2012.03.06].

Wishing for $2.50-a-gallon gas won't make it so. And blaming the President for $4-a-gallon gas won't make the causal connection true.


  1. Rorschach 2012.03.09

    Seems like there's a lot of snake oil being peddled by the GOP these days. The price of snake oil must surely be coming down due to increased supply, but public demand also seems to increase in even numbered years. Fortunately, there is no middleman, as the GOP's snake oil is not refined, but direct from the snakes themselves.

  2. Bill Fleming 2012.03.09

    Prediction: Every time Netanyahu pounds his fist on the table threatening to bomb Iran, the price of gas goes up at least a penny. The only reason it's not through the roof right now ($5 or $6) is because the speculators know GWB and Cheney aren't running the country any more.

  3. Michael Black 2012.03.09

    Stations don't make money selling gas. They make their money selling convenience items in the store. Whether you agree with beer sales or not, the profit from beverages is one of the ways that allow stations to stay in business.

    What's the reason for no profit on fuel sales? That's very easy to explain: almost everyone uses the convenience of plastic instead of writing a check or carrying cash. Merchant fees eat the mark up on each gallon sold.

  4. Owen Reitzel 2012.03.09

    "Oil speculators destroying recovery:"
    I agree Larry. But why can't we do anything about the oil speculators?

  5. larry kurtz 2012.03.09

    Heptane-rich Ponderosa pine infests the Black Hills and Rocky Mountains, Owen; and South Dakota's At-large Representative is up to her areolae in debt to earth haters.

    Al Franken is calling for more biodiesel (oh crap, too much like Europe).

  6. Daniel Buresh 2012.03.09

    Oil speculators are needed. Just like other commodity speculators are needed. The people's hate for them is misdirected and most don't understand how large economies work. What would you say if we all paid $0.20 a gallon and then one day we woke up and there was nothing left? That is what speculators are for. They keep pricing in check with the actual supply. President's have very little to do with the price of gas. If anything, congress has more of an effect. That does not mean we shouldn't be finding energy independence, but we need oil to get us there. It's not going to happen over night, and many of those who complain about it don't have a clue of what products they use come from oil. We should developing renewable sources of energy, all the while forming a solid energy independence with fossil fuels to get us there. Don't like it, quit posting because your computer came from oil, along with the lines you transmit your data on. Oil is going to be around for a long time, even if we do committ heavily to finding that next renewable source.

  7. LK 2012.03.09

    "Oil speculators are needed. Just like other commodity speculators are needed. The people’s hate for them is misdirected and most don’t understand how large economies work

    I'm going to have to google these sentences to be sure but I swear I read the same thing about loan sharks and people who deal crack.

  8. Daniel Buresh 2012.03.09

    Larry - Your opinion article is a joke.

  9. Daniel Buresh 2012.03.09

    Better google them. I'd hate for you to open up a book and understand macro economics and the fact that the US is slowly losing it's position as a leading demander of global resources. We have countries that are no longer treading water after WWI and WWII that are demanding the same style of living we are. Emerging markets in Asia play a much larger role in the price of gas more than anything. It only makes sense as other countries are consistently demanding more while we consume even less. Take out our ability to make money by exporting all jobs and you are really going to find out how fast we fall down the totem pole. That is one problem that is tough to fix when we can't even compete with these countries anymore at a manufacturing level.

  10. LK 2012.03.09

    Do you want me to go to a casino so that I can see how gambling works too?

  11. larry kurtz 2012.03.09

    Nationalize the oil companies and offer Statehood to Mexico.

  12. Daniel Buresh 2012.03.09

    If going to the casino were the only way to learn how individual games operate in the big scheme of casinos....then yes; but your analogy holds no water when pertaining to this discussion. To understand a global commodity and the impact of emerging markets in a global economy, one must have a good handle on macro economics. People think the price of gas is so simple, but it is only they who are simple minded.

  13. caheidelberger Post author | 2012.03.09

    I love it when Dan shows up to make excuses for corporate America and the 1%. It reminds us how deeply deluded some of our fellow citizens can become, and how hard we must work to help them find the truth... or at least to outnumber such corporate tools at the polls.

    LK, spot on with the gambling and crack comment. Dan confuses needs with wants.

  14. Bill Dithmer 2012.03.10

    I'm just curious Daniel. Since you seem to know a lot about macro economics, tell me how much the federal government subsidized big oil last year and how that played into the bigger picture of price structure.

    Also it would be nice to know at what point speculation becomes market rigging. There has to be a tipping point doesn’t there? After all if the same people are speculating that are producing then the speculation seems to have fraudulent overtones thus making the market more of a price fixing endeavor.

    If the common citizen had the same protections that big oil, the pharmaceutical companies, and insurance have they,”we” would all be rich. Unfortunately that will never happen.

    Again how much subsidization has big oil gotten from us,US, we the people, so they can continue to fix their prices? And at what cost is the continued subsidization of big oil? Lets hear how you want to factor these subsidies into the equation.

    Would it be just as cheap to give bigger subsidies to green technologies to help those industries grow at a faster pace? Do you feel that the subsidies really don’t have anything to do with prices? After all we know that eventually we are going to have to depend more on green techs and less on oil, not to survive but to compete on a global scale.

    Please give me a lesson on macro economics that I can understand. I'm sure there are others that would like to know as well.

    I will be waiting patently for your answer to these questions and your explanations thereof.

    The Blindman

  15. Daniel Buresh 2012.03.12

    I love it when Cory shows up to personally attack me, rather than point out the flaws in my argument. His childish remarks are what forced him to drive 300 miles to find a job.

  16. larry kurtz 2012.03.12

    Buresh, the earth hater, is up to his areolae in debt, calling the kettle black: hardly a surprise.

  17. Bill Dithmer 2012.03.12

    I was so looking forward to Daniels Carnac like illumination of macro economics. Imagine my surprise when I look and he didn’t do just that.

    If he cant even explain it then he must not know what it is. So much for any respect that I did have for him, and none in the future. When you cant even get a self proclaimed expert to explain his views then that person no longer deserves the title. Oh well just ad his name to the Drive By Blogger list.

    Just when I thought I was going to be schooled in macro I find out that the teacher was a fraud.

    The Blindman

  18. Bill Fleming 2012.03.12

    Daniel, what the energy speculators are doing is illegal under Dodd-Frank, just as some other forms of gambling and market rigging are illegal. Your observations about changing oil demand on the global level are fairly accurate, but they should not be taken as an excuse to commit highway robbery.

  19. Daniel Buresh 2012.03.12

    Dear Bill, I have a life outside the internet and rarely make appearances on blogs. Especially, liberal leaning ones that only result in kooks like Larry and Cory personally attacking me for things they know nothing about. I do give you credit for putting forth an argument, but I don't care to address any of it as I don't have the time. But for the record, I'd like to the see the "real" price at the pumps so Americans can really see what they should be paying. Subsidies hide the real costs from everyone. Then again, remove the subsidy that a majority of Americans aren't paying for and the ones who had no skin in the game from the beginning would scream bloody murder.

    You can add me to your list of Drive By Bloggers. I don't care to be lumped in with a group that only gets their daily human interation from an online blog. Life must be sad for these types. I'll probably post again in another couple weeks when Cory trys to elighten us all once again, so don't hold your breath. I'd rather avoid this place then give Cory the benefit of having my traffic.

  20. Troy Jones 2012.03.12

    Bill Fleming,

    We all have our expertises. Understanding the critical role that the futures market has to hold smooth price fluctuations of commodities is not one of yours. If you are correct Dodd-Frank makes this illegal, it again is assaulting the poor with a insiduous meanness to be truly evil.

  21. larry kurtz 2012.03.12

    Don't let the door hit you in the brain, Buresh.

  22. Bill Fleming 2012.03.12

    Daniel, you can subtract off about 56¢ a gallon for speculation and another 48¢ or so in state and federal taxes. You can also count on OPEC to be jacking up the price before the oil ever comes out of the ground in the Middle East. And if Israel bombs Iran, you can just kiss any cheap gas price goodbye for a long, long time.

    Now, tell me again why you're acting like such a pompous ass? No one asked you to post here, you know? If you don't like the company, go find somebody who will believe your half-baked, happy-horse-crap arguments.

    Conversely, if you stick around, you might actually learn something. Some fairly astute people post here (you and I being perhaps two moronic exceptions ;^)

  23. Bill Fleming 2012.03.12

    Troy, yes, I don't know much about markets. (But I can tell when you are demagoguing with that "hate the poor" mantra.)

    I hold the Department of Justice partly responsible for not cracking down on speculators and market fixers, and Congress for not having the balls to pass better laws.

    But then, that's problably because I'm just a regular Joe, American imbicile who reads the newspapers. LOL.

  24. larry kurtz 2012.03.12

    These guys are manipulating the market to pressure the President to get behind KXL during an election year, nothing more.

    And Jesus said: "greed is good."

  25. Bill Fleming 2012.03.12

    From a jobs standpoint, I'm not opposed to KXL. From an environmental perspective, I have some grave concerns. So does Nebraska (where all the water is.)

  26. caheidelberger Post author | 2012.03.12

    Dan, you have been deluded by corporate propaganda. You are wrong. If you take that personally, well, I can't help much. I don't come here looking to throw insults. You apparently do, given how quickly you turn from the actual issue to your apparent petty obsession with poking your finger in my eye, or with trying to find a way to hastily generalize everyone who disagrees with you as some subterranean Internet junkie misfit who isn't an upstanding and outgoing member of the community like the morally superior you. Really, Dan, how very tiring for all of us.

    Your original statement defending oil speculators as a vital part of the economy flies in the face of the classical Smithian capitalist morality that expects people to produce goods and services of value. The economic issues here are profoundly more important than your childish repetition of local insults.

    But I have to ask: do you denigrate everyone who moves from Madison to find better work elsewhere?

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