Commentary Magazine


Topic: gas prices

The Costs of Inaction on Iran

Last month, liberal outlets touted a report aimed at stifling calls for action on Iran. “Weighing the Benefits and Costs of Military Action Against Iran” was seen as the definitive answer to those calling for the establishment of red lines about Iran’s nuclear program. The report, sponsored by The Iran Project, was signed and endorsed by an all-star cast of foreign policy establishment figures (including some who have a record of hostility toward Israel) who were eager to support a study that purported to prove that an attack on Iran’s facilities would not be worth the effort in the event that the United States were to decide that all other options had been exhausted in the effort to prevent Tehran from acquiring a nuclear weapon. That report’s one-sided arguments were all that was needed for those who aren’t particularly enthusiastic about American action on Iran to claim that the military option ought not be considered. But the biggest problem with the study was the question it did not ask: What are the costs of doing nothing about Iran?

That more pressing question is answered by a new study that has just been published by the Foreign Policy Project of the Bipartisan Policy Center, “The Costs of Inaction: Analysis of Energy and Economic Effects of a Nuclear Iran.” The report acknowledges that taking action entails courting severe risks for the United States, the West and Israel. But it makes clear that these not inconsiderable dangers pale beside the consequences of a policy rooted in a foolish belief that Iran can be talked out of its nuclear ambitions. The result will be the creation of an Islamist nuclear power led not by rational military figures such as in Pakistan but by a theocracy whose extremist leaders may well seek to use such weapons as well as to employ them to back up their terrorist auxiliaries. But less understood is the way a nuclear Iran would have a significant impact on the cost and supply of oil. While Americans are understandably war weary after a decade of conflict in Iraq and Afghanistan, they need to know that listening to the counsels of those who wish to accommodate or ignore the Iranian threat will lead not just to a more unstable Middle East but bring with it a rise in the price of oil that could lead to them paying as much as an extra $1.40 per gallon of gas at the pump.

Read More

Another Legislative Defeat for Obama

Another (not totally unexpected) defeat for one of President Obama’s legislative proposals today. This time, the Senate rejected a measure to repeal oil company tax breaks, which the president urged them to pass in a stern speech this morning. The vote wasn’t completely split along party lines, with two Republicans supporting the measure and four Democrats opposing it.

Obama will continue to frame this as the GOP protecting the interests of Big Oil, but the fact that it failed in the Democrat-controlled Senate takes the edge off that slightly:

Obama has sought to deflect blame for high gas prices, in part by casting Republicans as allies of big oil companies. He used a Rose Garden speech to urge lawmakers to back the plan.

“Today, members of Congress have a simple choice to make,” Obama said. “They can stand with big oil companies, or they can stand with the American people.”

Read More

Obama’s Energy Tour a Political Disaster

President Obama’s energy tour was supposed to placate public anger over rising gas prices, and show voters that the White House is taking their concerns seriously. Instead, the tour only ended up highlighting Obama’s dismal energy record, and gave Republicans ample opportunity to make their case to the media.

The reason is that Americans have heard these promises from Obama before, and know better than to expect results.

Read More

Obama’s Energy Secretary Gives Himself an A- On Gas Prices

How out of touch is this administration with the struggles of the average American? This out of touch:

Rep. Darrell Issa (R-CA): In controlling the cost of gasoline at the pump, do you give yourself an A-?
Secretary of Energy Steven Chu: Well, the tools that we have at our disposal are limited, but I would say I would give myself a little higher than that. Since I became Secretary of Energy I’ve been doing everything I can to get long-term solutions.

The statement, made today to the House Committee on Oversight and Government Reform, will be general election gold for the GOP, played while images of rising gas prices across the country flicker across the screen.

Read More

Has Romney Found A Message?

The risk in pegging an election campaign to a specific issue is that the issue will be eclipsed by another or will fade in importance on its own. The campaigns of Mitt Romney and Rick Santorum have responded in different ways to slightly better jobs numbers. The Washington Post yesterday asked if foreign policy could end up playing a more significant role in the election than previously expected, though the Post notes that exit polling has not backed this up.

Economic fluctuation and the constant interpretation and reinterpretation of data make economic forecasting a less stable foundation of an election campaign than, say, asking simply if the public thinks they are better off now than they were four years ago. Gas prices have dented President Obama’s poll numbers recently, but that, too, may change. Romney, the more likely nominee, will have a less compelling argument against ObamaCare, for obvious reasons, though he can still run on his promise to repeal it. But beyond that, the question remains what kind of general election message will Romney present? He seems to have located one yesterday, and will be helped by Paul Ryan’s budget speech today.

Read More

Tapping Strategic Oil Reserve Won’t Work

President Obama has been backed into a tight political corner over rising gas prices. While it’s true that the president has little control over present gas prices as they currently stand, it’s also true that he’s made some high-profile blunders on energy policy during his first term, which makes him an open target for public blame. The Hill’s latest poll finds that a whopping 58 percent of American voters say Obama’s policies will lead to higher gas prices:

On energy, 58 percent say Obama’s policies will result in gasoline prices increasing, while just 20 percent expect them to cut prices — and by a 46-percent-to-36-percent margin, voters believe they will cause the United States to become even more dependent on foreign oil.

Voters’ wide-ranging pessimism comes as gasoline prices have risen sharply, which often dampens attitudes among U.S. voters toward those in power, and as opinions remain sharply divided on the president’s healthcare law.

Obama is setting out on a campaign tour to defend his energy policies this week, but his tools for dealing with the public anger are minimal. He’s been playing up his support for domestic oil production, but his recent rejection of the Keystone XL pipeline squashes that message. He’s pushing for an end to tax subsidies for oil and gas companies, but that will do nada to reign in gas prices and has more to do with his personal views on “fairness” than anything else. Republicans are also sure to point out that if raising taxes on oil companies has any impact on gas costs whatsoever, it’s more likely to raise the price at the pump.

Read More

Higher Gas Prices Tripping Up Obama

One of the more amusing things in politics is how badly rising gas prices have flummoxed the president and his administration.

For example, not that long ago Obama’s Energy Secretary, Steven Chu, was calling for ramping up gasoline taxes in order to encourage consumers into buying more efficient cars and living in neighborhoods closer to work. “Somehow we have to figure out how to boost the price of gasoline to the levels in Europe,” Chu said. (The prices in Europe are around $8-$10 a gallon.) But in a congressional hearing earlier this week, Chu painfully and awkwardly recanted. “I no longer share that view,” Chu declared. After his Senate hearing Chu even went on to say, “there are many, many reasons why we do not want the price of gasoline to go up.”

So the scales have fallen from the energy secretary’s eyes. But not his alone.

Read More

Obama Blames “Loose Talk of War” With Iran for High Gas Prices

President Obama has a special request. If you must talk publicly about the possibility of a military strike on Iran’s nuclear program, please do it in a whisper so as to not agitate the oil traders.

“The biggest driver of these high gas prices is speculation about possible war in the Middle East, which is why we’ve been trying to reduce some of the loose talk about war there,” Obama told WFTV, an ABC affiliate in Orlando, Florida.

In a speech last week, Obama criticized what he called “loose talk of war” by some pundits and politicians concerning Iran, which the United States and other Western nations accuse of pursuing nuclear weapons.

Read More

Democrats Mull Tax Hike on Oil Companies

President Obama has been arguing for the repeal of certain oil company tax breaks for years, and it looks like the current hike in gas prices may provide the White House with a convenient opening:

After coordinating with the White House, Senate Democrats expect to consider, likely before the end of the month, legislation that would repeal tax breaks for oil and gas companies, a senior Senate Democratic aide said.

Details of the bill are still being decided, but the revenues could be used for consumer relief or to fund alternative energy initiatives, the aide said.

The aide said there are no easy energy solutions and that Democrats will continue to pursue the “all-of-the-above” strategy advocated by the White House.

Read More

Polls Tell Democrats to Wipe That Smile Off Their Faces

In the last couple of months as the Republican presidential candidates began to tear each other to pieces and the economy began an ever so slight recovery, Democrats have begun to get back some of their old 2008 swagger. The bumpy first years of the Obama presidency followed by a landslide loss in the 2010 midterms had taken its toll on the party. A bad economy and a clear lack of presidential leadership during the debt ceiling crisis last year had left Democrats in the dumps. But the spectacle of the GOP contenders and their supporters and super PACs pointing out each other’s shortcomings cheered them up no end. After a long, hard winter of bad news it seemed that spring was bringing them back some of the hope and change mojo that might lead them to victory in 2012.

Unfortunately for them, the Obama mojo isn’t quite as potent as it once was. A New York Times/CBS poll published today confirms what the ABC News/Washington Post poll that came out yesterday told us: Even in the midst of what seemed to be a strong comeback, Obama is in deep trouble. The president’s approval ratings have dropped dramatically in recent weeks with the public disapproving of his job performance by a 47-41-percentage point margin. This is ominous news for a president at any point in his term in office but coming less than eight months away from his attempt to win re-election, it is a portent of possible disaster.

Read More

Obama’s Energy Promises Ring Hollow

President Obama isn’t the only one whose poll numbers seem to be sinking lately. A new Rasmussen poll found that Democrats in Congress are also losing ground to the GOP on the Generic Congressional Ballot:

Republicans hold a six-point lead over Democrats on the latest Generic Congressional Ballot for the week ending Sunday, March 11.

A new Rasmussen Reports national telephone survey finds that 44 percent of Likely U.S. Voters would vote for the Republican in their district’s congressional race if the election were held today, while 38 percent would choose the Democrat instead. Last week, the Republican led by three points, 44 percent to 41 percent.

Read More

The “Times,” It Ain’t A’Changing

Well, I’m back from my 12-day cruise off South America, lecturing with a Hillsdale College group. Except for two ten-hour flights on American Airlines in economy-class seats that would, were I a prisoner of war, violate the Geneva Convention, it was a great trip, with a great crowd.

Much to my surprise, on my return I found that the New York Times’s editorial page is still utterly predictable. The lead editorial this morning for instance, contains absolutely nothing new regarding drilling in the United States and U.S. waters. The Times writes:

It’’s campaign season and the pandering about gas prices is in full swing. Hardly a day goes by that a Republican politician does not throw facts to the wind and claim that rising costs at the pump are the result of President Obama’’s decisions to block the Keystone XL pipeline and impose sensible environmental regulations and modest restrictions on offshore drilling.

Read More

Obama’s Keystone Retreat a Matter of Time

Environmental activists are already up in arms about the White House’s decision to support the partial construction of the Keystone XL pipeline. But they should prepare themselves for a lot more disappointment down the road.

President Obama has been playing both sides of the Keystone XL debate since the beginning, and his thumbs-up to the partial construction is the latest sign he’s only interested in delaying the pipeline long enough to hold onto environmentalist support until after November 2012.

Read More

Stay Engaged with Tunisia

As Max Boot implies, riot-torn Tunisia is not predestined for any particular future. The U.S. response will matter to the outcome. The sclerotic Ben Ali regime has been under rhetorical fire from dissidents for years due to its corrupt, repressive character, but there is no evidence of an organized opposition bent on armed revolution. No ideological red flags are waving over Tunisia; there may be groups encouraging the outbreak of unrest, but there has been no accelerating drumbeat from a well-defined radical organization like the plotters of the Iranian revolution in 1979. The riots in Tunisia mirror the fears in Algeria, Libya, Egypt, and Jordan over a common set of economic woes: rising food and gas prices and high unemployment.

But while Tunisia may not be experiencing a centrally directed ideological revolt, the political conditions are not quiescent there. If pluralism and consensual government are to take hold, the U.S. will have to interest itself in the process. The usual suspects — the Muslim Brotherhood, al-Qaeda — have stakes in Tunisia already. The principal opposition group, al-Nadha (“Renaissance”), is an affiliate of the Muslim Brotherhood. Its leader, Rachid Ghannouchi (not to be confused with the prime minister, Mohamed Ghannouchi, who took power on Friday), is an exile in Britain, a biographical detail that echoes the history of Ayatollah Ruhollah Khomeini. But Ghannouchi’s profile as a Sunni Islamist leader is more similar to that of the Muslim Brotherhood’s Yusuf al-Qaradawi; Ghannouchi endorses terrorist groups like Hamas but spends most of his time writing, lecturing, and attending conferences.

Rachid Ghannouchi has been largely silent during the past week’s unrest, giving no indication that he has specific political intentions. But he would be a natural focus of interest for regional governments — Turkey, Saudi Arabia, Italy, France — that are on the alert to influence developments in Tunisia. Attempts at influence by Tehran are a given as well: Ghannouchi was an early supporter of the 1979 revolution and has maintained his ties to Iranian clerics. Tunisia severed relations with Iran in the 1980s over the Islamic Republic’s penchant for fomenting unrest, but diplomatic and economic ties have been restored over the past decade. These ties include an Iranian cultural center in Tunis (referenced here and here), an entity that in other regional nations has been a means of introducing paramilitary operatives and Islamist recruiters. Read More

RE: Do They Know What Obama Is up To?

Well, some American Jews plainly do. A reader passes on this account of a recent gathering in California, suggesting that there is a motivated group of Jews not at all pleased with Obama’s Middle East policy:

Last night I went to a town hall meeting on Israel featuring Congressman Brad Sherman at Temple Aliyah in Woodland Hills, CA, called by the rabbi in response to the concern over the deteriorating relationship between  President Obama and the State and the people of Israel. Sherman is a 7th-term Jewish Congressman with strong ties to the Jewish community, who has always been considered very pro-Israel. Sherman must have expected a hostile crowd, as he did not allow anyone to talk to him directly. Questions were submitted in writing and chosen and paraphrased by the moderator (Rabbi Stewart Vogel of Temple Aliyah, who did do a very good job expressing the written concerns of the audience while also being fair and hospitable to Sherman).

Nearly all the questions dealt with the controversy. The meeting hall of this large congregation was packed, and the temple’s parking lot  was entirely full, forcing people to park on the street nearby.  Nearly all questions and audience feedback were negative, with virtually no applause for Sherman’s answers. There was lots of clapping for hostile questions, lots of hostile rumblings as he tried to answer charges, and some answers were booed. Even the moderator at the end basically accused Sherman of not actually answering a lot of the questions. The audience was not sold on Obama being pro-Israel, nor on Sherman’s excuses for the current situation.

Sherman portrayed himself as more pro-Israel and more concerned about Iran than any U.S. president during his Congressional service. He shrugged off the current controversy as something we will have forgotten in a few years, arguing that the U.S. relationship with Israel is fine because the foreign aid package remains and we haven’t yet stopped vetoing anti-Israel UN resolutions. While he promised action on his part concerning sanctions on Iran, he expressed skepticism that anything would really be done (at one point “joking” that the rabbi would be more useful than he, as if divine intervention would be required), and kept emphasizing that any military option would spike gas prices. These statements did not go over well.

Most negative were the reactions when when he repeatedly wrote off his and Obama’s critics as die hard right wingers who would be angry regardless. The moderator polled the audience and showed that the room was about 60/40 McCain voters, meaning there were in fact many angry Obama voters there (and that Obama opponents of all kinds are energized in this community). The most applause was for the question of whether many Jews would switch their votes to Republican because of this controversy — which fired up the crowd and those potential switchers.

Well, one crowd is not necessarily indicative of the entire community, but this suggests that those most concerned about Israel — and willing to turn out to ask questions of their congressman — are the most aggrieved by Obama’s policies. Whether this translates into a drop-off in Jews’ financial support and/or votes for Obama and like-minded lawmakers is an open question. But one wonders what they are waiting for. A declaration by Iran that they do in fact possess a nuclear weapon? An announcement by Obama that he’s going to unilaterally recognize a Palestinian state unless Israel accepts his imposed deal? Really, if not now, when?

Hillary On The Factor

Hillary Clinton went on Bill O’Reilly’s Factor. The first half of the interview can be seen here and here. If you grade on substance, she’s fairly awful. She going to sue OPEC through the World Trade Organization and tax oil companies to bring down gas prices. (Honest. No, it’s not clear what happens if OPEC doesn’t answer the first set of written discovery requests.) She’s raising income taxes and she’s not willing to come clean on how much her health care plan will cost.

But on style it’s hard not to gape at her tour de force – pugnacious, funny (she says with a twinkle in her eye that she’d expect nothing but “fair and balanced” coverage from Fox), quick on her feet and, within the confines of her shtick, somewhat candid. She’s a phony, but sort of a real phony.

For Democrats and independents who buy into the populist economics and think someone really is going to have to go fight the mean Republicans and the big bad insurance and oil companies, it’s hard to imagine a feistier combatant.

Republicans have long worried that Barack Obama would be a soothing, deceptively alluring figure in a general election. I think what we saw on O’Reilly was that if she makes it that far, Clinton will be a different, but perhaps equally challenging, figure. Somewhere along the way she learned to articulate a nostalgic, even patriotic vision (“Let’s go back to the 50′s and 60′s,” she says) in which, she says, the middle class isn’t under seige. You can argue with her facts, but the message is clear, the audience specific, and the patter fairly effective. One wonders how skilled John McCain will be in arguing with her about health care and the relative merits of the Clinton and Bush economies. Part 2 of the interview will air tonight.

“We Are Going to Investigate These Gas Prices”

Hillary Clinton says gas prices are the result of Enron-like market manipulation. Apparently the fact that China is buying a lot of petroleum is a market manipulation.

Stop Digging Already

Barack Obama issued a somewhat standard greeting for Pope Benedict XVI, but apparently couldn’t resist throwing in this:

At a time when American families face rising costs at home and a range of worries abroad, the theme of Pope Benedict’s journey, “Christ Our Hope,” offers comfort and grace as well as a challenge to all faith communities to put our faith into action for the common good. It will not only be Catholics who are listening to the Holy Father’s message of hope and peace; all Americans will be listening with open hearts and minds.

Do Catholics and other people of faith think Pope Benedict’s appeal has special resonance because of “rising costs”? Would he be less welcome if gas prices were lower? I’m fairly certain Catholics believe in the message of “comfort and grace” even when prices are steady. And if Obama isn’t saying this–for an eloquent guy he seems perpetually to be misundertood–why mention “rising costs” at all?

This seems a bald-faced attempt to say “See, economic conditions do impact religiosity.” For those who were offended the first time Obama went down this road, they won’t be thrilled to see him try it again. Using the Pontiff’s visit as an excuse to reiterate his own political defense seems crass, at best.

At some point Obama may want to give up this “false consciousness” canard and instead concede that faith is not a mere refuge from economic anxiety. But no: he was right and he’s not backing down. See? See?

But I Just Want To Drive To Work

Hillary Clinton is back to “listening” and taking questions from voters. In her latest North Carolina ad, she gets asked by “Tamie of Cherryville” about high gas prices. Her answer is a lovely non sequitur: Hillary goes on about the importance of renewable energy. Great answer–to some unasked global warming question. But nothing she said, of course, will affect Tamie’s plight now or anytime in the near future.

Hillary might have offered to reduce federal gas taxes. That would help right away. She might have said, as John McCain did, that she would stop adding to the National Petroleum Reserve. She might have explained the perils of a low dollar which make oil and all other commodities expensive. Or she could have gone the Al Gore route and said it is good that gas prices are high because that’s what must happen in a market economy to encourage development and use of alternative, non-carbon based fuels. She could have even encouraged Tamie to use public transportation or carpool with her friends.

But no. Hillary is going to spend $150B on renewable energy, so that in ten years Tamie might be able to get a solar-powered car. I actually think there may be good reasons for that, but it isn’t going to help Tamie anytime soon.

That is the peril of pretending to answer voters’ questions: sometimes they really do want an answer.

More UN Fumbling

UN special envoy Ibrahim Gambari arrived in Burma yesterday. Ban Ki-moon, the UN secretary-general, said his diplomat would try to further “democratic measures by the Myanmar government, including the release of all detained students and demonstrators.” This is Gambari’s second trip to the nation since countrywide protests in September, and it follows his Asia shuttle diplomacy that the Washington Post characterized yesterday as “time-wasting busywork.”

Specifically, Gambari will continue his efforts to initiate a dialogue between the junta that has misruled Burma and Aung San Suu Kyi, the detained leader of the opposition. After crushing the recent demonstrations, it’s hard to see why the generals, led by the notorious Than Shwe, would concede any ground. In fact, they just ordered the expulsion of the chief UN diplomat in the country, Charles Petrie, for his mild comments last month about the odious regime. In response to the government’s harsh response, the best that Ban could manage is to issue a statement saying that he is “disappointed.”

Well, the rest of us may be more than just a little peeved. We have moved beyond the point of wanting to talk to the junta and no longer wish to see Burma’s leaders trifle with the UN (even if Ban is perfectly content to let his organization be humiliated). In short, it’s time to call for a sanctions vote in the Security Council. Economic isolation is the one thing that can end this particular blot on humanity in fairly short order. After all, Petrie is being turfed out for linking the recent protests to deteriorating economic conditions. It was unhappiness over the doubling of gas prices that triggered the last round of Burmese protests.

It’s time to see who has the gall to vote against condemning the junta with words and sanctions. And if tougher measures fail in the U.N. because Beijing, the regime’s main benefactor, exercises another veto, President Bush can try to rally the rest of the international community. If he’s looking for a legacy, then this is the moment to exercise the leadership of which he is still capable.