Gasoline prices are again putting a crimp on consumer’s budgets. Prices, as readers will recall, topped out at over $4.00 per gallon in the fall of 2008. After that, as a result of the Barney Frank – Chris Dodd financial collapse, prices dropped like a rock and bottomed out at about $1.60 per gallon in late 2008. However, long term market forces reasserted themselves and prices have been rising fairly steadily since then, and today are again approaching the $3.00 benchmark, even exceeding it in some locales, via CNN:
Gas prices crossed the milestone $3 mark Thursday for the first time since Oct. 17, 2008, as the national average compiled by motorist group AAA reached $3.013 a gallon.
Prices have risen more than 4% from $2.872 a month ago and are nearly 16% higher than the $2.585 average a year ago, according to the AAA figures.
The rise in gas prices mirrors a rise in crude oil, which passed the $90 a barrel mark on Wednesday. Oil prices haven’t settled above $90 a barrel since October of 2008.
The spike in crude has been helped along by a weak dollar, and according to some critics, the Fed’s quantitative easing program.
There is no reason to believe this trend will stop, given the current administration. The rise in gasoline prices is directly attributable to the falling dollar which is the inevitable result of Obama’s horrendous fiscal policies and, as CNN notes, the misguided monetary policies the Bernanke Fed is following such as QE2. Now we learn that Obama, in his…er…infinite wisdom, has decided to launch a third front in his apparent battle to drive gasoline (and other energy prices) higher still. His EPA announced today that they will target carbon dioxide emissions from oil refineries, among other things:
The Environmental Protection Agency announced Thursday that it would regulate greenhouse gas emissions from power plants and oil refineries next year, targeting the nation’s two biggest sources of carbon dioxide.
The move, which comes as part of a legal settlement with several states, local governments and environmental groups which have sued EPA under the Bush administration for failing to act, highlights the Obama administration’s intent to press ahead with curbs on carbon despite congressional resistance.
This is simply asinine, not to mention an unprecedented usurpation of power. Obama can’t get cap and tax through by legal means, therefore he is imposing it via administrative fiat. But leaving that aside, for the reasons indicated above, gasoline prices are already headed higher, and new regulatory requirements on oil refineries will only exacerbate the problem. Who does Obama think will bear the cost of this increased regulatory burden? (Hint: it won’t be the oil companies.) The main effect of such a scheme will be skyrocketing energy prices, a continued dearth of new refinery capacity in the U.S., and fewer jobs in the energy sector. Obama is intent on forcing energy prices to “necessarily skyrocket” through an economically toxic mix of fiscal, monetary, and regulatory policy.
How this helps the economy is impossible to decipher. It appears closer to economic suicide than anything else. Whatever economic growth the economy is eking out at the moment will come to a screeching halt if energy prices continue to rise, as Obama’s policies guarantee they will. Governor Palin, who has been the most effective and outspoken critic of Obama’s disastrous energy policies, will be well-positioned to capitalize on this in 2012 should she run. That’s the good news. The bad news: we will all have to suffer a “Carteresque” economy in the meantime. Let’s hope enough of our energy sector survives so that there is something left to rebuild in 2013.