“I try to be cynical, but it’s so hard to keep up.’’ — Lily Tomlin
AS GAS PRICES drifted toward $4 per gallon last month, politicians dashed to the microphones, and the crazy talk began to flow. The torrent of miracle cures, scapegoats, and quick fixes is designed to placate and deflect attention. The rhetoric is designed not for economists, but for angry voters. Therefore, politicians assume, it doesn’t need to make any sense. It should just sound confident, convincing, and a little angry.
President Obama didn’t invent Gas Price Crazy Talk, but he’s worked it hard. His recent comments are a guidebook for aspiring demagogues. And by all means, he needs to be on the top of his game. Energy is a global market, buffeted by everything from growth in China to saber-rattling in Iran. But Obama has pushed a long line of policies whose likely outcome will be higher prices for oil, natural gas, and fuel at the pump. Maybe no one will notice.
The best crazy talk always begins with seizing the intellectual high ground. “There are no short-term silver bullets,’’ intoned the president at a University of Miami speech. The phrase assured the crowd of his thoughtfulness. Then, with both deftness and an awesome lack of self-awareness, he offered the craziest silver bullet imaginable: algae.
“And we’re making investments in the development of gasoline and diesel and jet fuel that’s actually made from a plant-like substance known as algae. Believe it or not, we could replace up to 17 percent of the oil we import for transportation with this fuel that we can grow right here in America.’’
Seriously? Maybe the president was just pandering to some massive (and highly secretive) algae lobby. Ten years from now, if 15 percent of America’s transportation fuel is made from algae, I’ll eat my hat.
The president’s campaign mantra is definitely “listen to what I say, don’t look at what I did.’’ After all, in just three years he shut down America’s deepwater energy exploration for six months, encouraged the EPA to restrict the use of energy sources containing carbon, and refused to permit America’s biggest oil pipeline project in 30 years. These may not be make-or-break economic decisions, but they are far from gas-price friendly.
Normally, Obama would have a bit more ammunition to work with, but the old “Blue Ribbon Task Force’’ standby was already shot from his quiver. Last April he assembled a crack team to “make sure that no one is taking advantage of the American consumers.’’ It was a ringing success, I’m sure. So we can rest easy knowing that the president’s policy, not illegal behavior, is driving the stiff prices we’re paying for gas.
What ever happened to the good old days when we just pointed the finger at mean-spirited “speculators’’ and were done? It was a popular liberal line a few years ago. And last week, Bernie Sanders decried that in June 2008 “speculators overwhelmingly controlled the oil futures market.’’ He neglected to mention that their net position was short; in other words, they would have benefited from a drop in oil prices.
Not to be outdone, Senator Harry Reid held a press conference calling for a good old-fashioned Federal Trade Commission investigation. The senator seemed unaware that the FTC already had an investigation going for the past year - and has reported no wrongdoing or “rampant speculation.’’ A preliminary study by the Commodities Futures Trading Commission reached a similar conclusion.
Which brings us to the last line of crazy-talk defense: “Release the SPR!’’ (That is, the Strategic Petroleum Reserve.) Responding to calls from a handful of Democratic congressmen, Treasury Secretary Tim Geithner has hinted that it’s on the table. Yet the reserve is intended for national security purposes, not price manipulation, and past releases, like the one Obama approved last year, have had little impact on prices. But after pulling out the task force, attacking the speculators, and promising cars that run on algae, it’s really not much of a stretch.
We’ve seen this show before. When prices spiked in the ’70s, the ’90s, or the ’00s, politicians of all stripes were enchanted by gilded promises of synfuels, ethanol, and hydrogen. Today, it’s pond scum. No one welcomes high energy prices, any more than we would high prices for food or medicine. But the laws of supply and demand in a global marketplace will not be repealed.
It would be nice if someone treated Americans as though they were adult enough to understand. Instead, the cycle of Gas Price Crazy Talk lives on.
John E. Sununu, a regular Globe contributor, is a former US senator from New Hampshire.