At $5 A Gallon, Gas Prices Will Be The Issue In 2008 Campaign
Remember in the 2004 presidential campaign when George W. Bush and John Kerry briefly sparred over the price of gas? Democrats predictably blamed “Big Oil” and promised Congressional investigations. Republicans blamed Democrats and environmentalists for blocking efforts to build more refineries and drill for more oil, especially in Alaska. The tussle failed to attract more than the attention of a couple of political reporters. Why? Gas prices nationally were $1.80 a gallon, and only in California did they rise above $2 a gallon.
Well get ready for $5 a gallon fuel next summer when the price of gasoline becomes the issue of the presidential campaign. At that price, gasoline will top Iraq as the top concern of most voting Americans. And get ready for the Republican message machine to do what it does best: focus on a single issue, identify villains, command the message agenda, propose actions that working people find plausible, dial into its constituency, and pull the G.O.P. into position to win an election it has no business even being competitive in.
Here are the suppositions and observations upon which this scenario is built. First, gasoline prices have climbed nearly 60 percent over the last five months — in January the national average was $2.33 a gallon — and this month reached $3.65 a gallon in northern Michigan, just 35 cents less a gallon than the $4 level I predicted in April. The knife edge that separates demand and supply is so sharp now that any number of supply disruptions in the United States or overseas — storms, plant outages, strikes, pipeline failures, shipwrecks — can cause prices to rise 25 cents in a day, as we saw here in late April. It’s easy to forecast $5 a gallon next summer. The underlying market forces are pushing prices inexorably higher.
Second, fuel prices affect every American, regardless of whether they live in cities and barely use their vehicles, or live in the suburbs and rural regions and drive 20,000 miles a year or more. The rising cost of fuel is one of the most closely watched indicators of economic and social well-being because until the nation figures out that cars, highways, strip malls and parking lots are no longer the best measure of what makes a place great, the United States will continue to experience a collective stomach ache in most households, and in some real hardship. This month my family’s fuel bill rose from the $325 a month that we normally spend on gasoline to over $500 a month. I earn a decent living and we are fortunate to be able to fold the extra cost into our budget. But for hundreds of families in this rural region who drive as much or more than we do, an extra $175 a month for fuel is the difference between survival and foreclosure.
The Traverse City Record-Eagle reported on Sunday that home foreclosures have quadrupled in northwest Michigan since 2000, and with gas prices climbing the numbers will accelerate. School administrators in our rural district anticipate enrollment will drop in September by 81 kids, a six percent decline from enrollment this year. In other words, 35 families with children are expected to leave Benzie Countyover the summer.
Third, the suburban and rural voters affected most by $5 a gallon gas live in predominantly Republican red counties. Though they may be disillusioned with George Bush and his administration of inept managers (I’m being delibarately kind out of respect for my GOP readers) they are still inclined to vote Republican if the party convenes around a candidate and a message that makes sense. For the G.O.P message masters, $5 a gallon gas is an easy one. They know high gas prices aren’t just an irritant for their working family constituency in the suburbs and rural areas. It’s an emergency. They can lay the blame at the feet of liberals who blocked the oil industry from developing new reserves and used regulatory barriers to impede construction of new refineries. They can convince their voters that the solution lies in electing Republicans who will open offshore fields and the Alaskan National Wildlife Refuge to exploration, limit the reach of onerous regulations that further limit supplies, and offer even more subsidies and incentives to the oil industry to build new refineries.
Whether the Republican solutions have any merit — and none of them do — is not the point in a presidential campaign. As we’ve learned in this century, facts and truth are not necessarily the most important building blocks to credibility. More important for the anticipated Republican message is that the Democrats, once again, have no message on gasoline prices. Check out House Speaker Nancy Pelosi’s grand standing on the issue in Washington earlier this month (see video). The Center For American Progress, a prominent Democratic activist think tank in Washington, is a good example of the Democrats’ absolute failure to anticipate and respond to the issue. The Center’s recipe for dealing with high gasoline prices involves (1) blaming the oil companies, (2) comiserating with consumers, and (3) noting that lower prices would be a benefit to millions of Americans. It’s pathetic.
If Democrats fail to develop a clearer and more relevant response to $5 a gallon gas — some mix of unexpected short-term relief like a gas tax moratorium with a realistic menu of emergency and longer term fuel economy rules, vastly increased investments in alternatives to driving, and incentives for designing more compact communities — they are likely to lose the White House again.