The GOP has made gas prices the talking point of the day. Republicans are trying to put the blame on Obama, and it shouldn't stick. The people who are actually causing gas prices to rise are the ones funding Republican criticisms of high prices, a minor conflict of interest. WTH explains how the public debate over gas prices is just another example of the conflict of interest we are forced to swallow in this age of big money politics.
Former Clinton Labor Secretary (among other government positions) Robert Reich explains the cause of rising gas prices as related to three factors:
1. Decreased supply as a result of Iran cutting exports to the US, UK, and EU.
2. Increased demand as hopes for a global economic recovery are being realized.
3. Speculation by money managers and hedge funds that 1. and 2. will cause the price of oil to rise.
Reich goes on to note that speculation has had the largest (by far) impact on the increase in price, and if the story stopped there, it would be a pretty vanilla economics story.
Timing is everything. With 2012 being an election year and the economy showing lots of good signs, the Republicans will pounce on any negative indicator it can find (like this and this). I'm sure you will see campaign ads on rising gas prices and hear the same sound-bytes over and over. And who will pay for these attack ads? Hedge funds that by and large support the GOP candidates for President.
Which is to say the people who are actually causing gas prices to rise are the ones funding Republican criticisms of high prices, a minor conflict of interest.
The Obama Administration can take some credit for this political problem in that it did little to restrict or regulate speculation, even after spending much of the '08 Presidential Campaign railing against the destruction it had reeked on the economy. There were also many members of Congress, including Senator Bernie Sanders (I-VT) who advised the President to reign them in.
This points to the real underlying hypocrisy in this entire charade. Republicans will spend the next 9 months trotting out old slogans on small government, but it was a "big" government solution that was needed to keep gas prices low. For the last 20 years, Republicans have supported the de-regulation of the financial markets, which has been sweet music indeed for investors. Now that the results have come rolling in (commodity prices on overdrive because of unbridled speculation), they're happy to take shots at small government policies. Hopefully no one will notice.
It underscores the central talking point. Government doesn't have to be small or large. It just needs to be good. If we really want to do something about gas prices, legislation needs to be directed at regulating speculators and dealing with the problems with oil itself. Blaming Obama gets us nowhere, especially when the finger is being pointed so hypocritically. Both parties have failed the American people on this issue by ignoring regulation, and the only way that will change is if we address the real issue: the money behind the candidates.
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This is a cross-post from Watching the House
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