Oil, like political punditry, is a commodity, traded freely on the open market and subject to the laws of supply and demand. The difference of course is that punditry enjoys an abundant and renewable supply, flows freely, and produces nothing of value. Oil, on the other hand, is actually important. The problem is that people think they are related.
So let’s adopt a new rule: The President has very little to do with the price of gas. Full stop. To blame any President for the price of gas makes as much sense as thinking he is somehow responsible for the price of cocoa, gold, and rubber. It’s the same logic that convinced primitive cultures that thunder meant the gods were angry. It’s this kind of ignorance that makes me think we’re not ready for sharp tools as a culture. No wonder the aliens hide from us.
Speaking of space, Newt Gingrich tried to “own” this issue when he ran for president, promising that if he was elected gas would cost $2.50 a gallon. Gingrich, who brandishes a showy wit that makes him look smart to dumb people, seemed convinced that Obama’s policies were sentencing us to four more years of expensive gasoline. The government predicts the average gallon of gas will run you $2.60 next year, which means Gingrich’s promise would have made exactly a dime’s worth of difference.
I used to be as guilty as anyone at seeing the false causation between the price of gas and the President’s economic stewardship, but remarkably-and I know this will shock you-I tended to be a harsher critic of expensive gas during Republican presidencies. It’s the kind of connection that feels like it should make sense-until you think about it, that is. Then it just makes you feel stupid, which is where political pundits come in. They never think about it.
Pundits used to hold Barack Obama responsible for the high price of oil and the subsequent sticker shock at the gas pump. Now some pundits are blaming Obama for cheap oil, which some think will hurt the economy.
Somehow Obama isn’t responsible at all for steady job growth, low inflation, and shrinking deficits. But the price of a commodity? Oh yeah, that’s Obama’s fault. (You know where oil futures are traded, don’t you? Chicago. Don’t be naive, man!)
Here’s where observers dress up their dim thoughts in their Christmas finest by announcing the obvious: A low price at the pump means the drive to Grandma’s house at Thanksgiving will be cheaper. (Gosh. Really?) If oil fetches a lower price, oil companies will be less likely to suck it out of the ground. (No way. Do tell.)
Soon cheap oil will scare Texas politicians into thinking that they, these titans of limited government, should harness the winds of global economics to help business. And not knowing a full compliment of words, these politicians will follow this line of thinking to their inevitable mirage of money under the rainbow: tax cuts!
This isn’t to say that using tax dollars to bribe energy companies into getting rich doesn’t work. Energy companies aren’t pundits. They can add and stuff, and so they can tell when drilling for oil in Texas is cheaper than in another state where they aren’t quite as generous with the people’s debit card.
But here’s where the mythology breaks down. During this long, steady energy boom, our elected leaders have claimed credit for the economy that was fueled (sorry) in part by the energy boom. They bragged about creating a favorable business climate, which in Texas translates to low taxes and easy, breezy regulations. And even when the price of a barrel of oil was north of $100, Texas was happy to volunteer all kinds of tax breaks.
The days of $100 for a barrel of oil are gone, at least for now. But the formula for the Texas Miracle is still the same. Pointing out the lack of correlation at this point would just be mean. Best to just sit back and let the pundits blame Obama and promise that more tax cuts in Texas will have something to do with the price of oil.
Jason Stanford is a regular contributor to the Austin American-Statesman, a Democratic consultant and a Truman National Security Project partner. You can email him at stanford@oppresearch.com and follow him on Twitter @JasStanford