Will GOP Attacks on Gas Prices Backfire?

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"Will GOP Attacks on Gas Prices Backfire?"

by Carl Pope, via The Huffington Post

The Republicans should be careful. Their current naïve faith — that high gasoline prices on a Democratic president’s watch gives them a political edge — overlooks their own profound vulnerability, and seems to be based primarily on the (not entirely unwarranted) assumption that the president will parry, rather than thrusting at their own weak spots.

Begin with the blame game. High oil prices are largely the direct and inexorable result of the utter failure of successive American governments of both parties to take long term steps to reduce the market power of the oil cartel since 1972. So the unwillingness of the American political system to confront the power of international oil is the culprit. Everything else is short-term noise.

But the politics of the issue are mostly about this short-term noise. Public attitudes this season are focusing the blame in places that ought to worry the Republicans. The last time oil prices spiked, during the Bush Administration, the public blamed the oil companies first and the White House second.

But this time the oil companies are being linked to speculation and manipulation of the markets — 38 percent of the public in a recent National Journal poll blamed “the manipulation of prices by large energy companies.” Another 28 percent thought tensions in the Mideast were to blame. Only 14 percent blamed Obama — 5 percent Congressional Republicans. (Other polls have found Congress more culpable than Obama, but none has found Obama to be primary focus of public anger. Indeed, 44 percent of respondents in another recent poll expressed greater faith in Obama on the issue.)

Why should this set of attitudes worry Republican candidates this year? Well, there is the potentially toxic fact that they are widely seen by the public as too close to the oil industry, an attitude likely to be reinforced as the media covers the sources of campaign money during the rest of the year, since Republicans get 88 percent of oil industry dollars, and have already raked in $14 million.

Worse, media coverage of money in politics this year is not primarily focusing on direct gifts to candidates, but much more on the financial backers of independent Super PACs. Here the Republicans seem almost fatally exposed. Their single most visible oil and gas patron, and the major funder of their pro-oil campaign efforts, the Koch Brothers, symbolize everything the public hates about speculative markets, oil companies and big money in politics. The Kochs are the major donors behind Americans for Prosperity, which led the oil industry’s Solyndra-framed attack on the Obama Administration’s loan guarantee program for clean energy. Koch was also heavily involved in the Keystone Pipeline effort, because it would have been a major financial beneficiary, and has frequently funded campaigns against wind energy.

But the Kochs are not an oil and gas exploration, production or refining company — like Exxon, Valero or Anadarko. At their heart they are speculators. Indeed, they are credited with having invested the derivatives market in oil and gas, and having prevented it from being regulated every since.

Since even a pro-derivatives company like Goldman Sachs estimates that pure speculative pressure is responsible for $0.56 of the price of every gallon, the business that the Kochs are in is about as close to pure political poison as one can imagine — and the Republicans can be certain that the Koch brand will be widely and broadly flashed in the electorates’ face between now and election day.

Now not all big Super PAC donors are from the oil patch. The single biggest donor to Republican independent efforts thus far is Texas billionaire Harold Simmons. But while Simmons is not an oil man, his personal profile, with a deep history of manipulating government for his own profit in areas like licensing a private nuclear waste dump in Texas, market manipulation, and lead poisoning, resonates with that of the Koch Brothers and reinforces the image of Republican donors as being very definitely not on the side of the average American driver.

Nor is it particularly challenging to connect the dots between Super PAC dollars and Republican congressional votes and presidential campaign positions. The ongoing debate about oil industry subsidies, the consistent call of Republicans for higher profits and more giveaways for oil, and the willingness of the Republican leadership to block otherwise very populist measures to protect oil subsidies are all fodder for some very damaging campaigning in the fall.

So each of the major stories the Republicans are planning use against Obama this year — high gas prices, the Solyndra bankruptcy, Keystone Pipeline, even deficit reduction efforts — have all been poured from the poisoned chalice of their Super PAC oil donors.

Should the Republicans be confident that their spin on the price of driving will prevail? Or are they frenetically creating voter focus on a series of issues which may well, judo like, be turned against them? There’s not much in the polls that would make be terribly confident if I were Karl Rove or Mitt Romney.

– Carl Pope, a veteran leader in the environmental movement, is the former executive director and chairman of the Sierra Club. Mr. Pope is co-author — along with Paul Rauber — of “Strategic Ignorance: Why the Bush Administration Is Recklessly Destroying a Century of Environmental Progress,” which the New York Review of Books called “a splendidly fierce book.”

This piece was originally published at the Huffington Post.

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5 Responses to Will GOP Attacks on Gas Prices Backfire?

  1. Mike Roddy says:

    Interesting, Carl, but the Democrats also had the issue of Koch machinations on their side in the 2010 Congressional elections, and failed to exploit it.

    Obama has indeed been offered an excellent campaign issue, but apart from cursory moves against fossil fuel subsidies, he hasn’t done much. On the contrary, he’s greatly expanded drilling in sensitive areas, and continues to voice basic approval for the tar sands pipeline, framing the shelving of the northern route as a delay.

    The voters may be listening to your solid argument, but the Democrats are not, apart from Waxman, Sanders, Boxer, and a very few others. When it comes environmental and climate issues, we need leaders, not power brokers who are constantly parsing their positions- and hearing footsteps from their own wealthy donors.

    • the Democrats also had the issue of Koch machinations on their side in the 2010 Congressional elections, and failed to exploit it.

      Indeed. And why is this?

      While Carl Pope’s argument may seem persuasive, methinks it suffers from a major flaw: it assumes that a politician’s main goal is to please as much of their electorate as possible?

      But with any assumption, it’s always useful to ask: Is it really true?

      So, to what degree is it true that politicians seek to please their electorates? I think it should be obvious that pleasing voters isn’t an end in itself, but rather an means to other ends.

      And these ends tend to be the usual: power, money, or sex, or a combination thereof.

      And if a politician believes they can gain more power, money, or sex by ignoring the will of voters — or even by hoodwinking voters to the point that they forget what they really want — then that’s exactly what they’ll do.

      That is the key problem. And it rather undermines the whole premise of Pope’s argument.

      (See also Jay Rosen’s blog post on “electoral blind spots”, which I came across on Climate Progress some time back.)

      – frank

  2. Bill Goedecke says:

    It would be helpful if the detail about how the gasoline price is being affected by speculation was fully developed. The way I understand it, gasoline stations are a low margin business. The oil and refinery companies from which gasoline stations purchase product are complex corporations which are affected by price differentials from different markets. The pricing of oil per barrel differs depending on grade and market. So it is not such a simple game. The western oil majors are racking up some cash, but their oil field reserves are not increasing. As is typical for US corporations in our current economic configuration, when profit is more difficult to come by through development of product then they may turn to financial vehicles to enhance capital. However, there is no detail in this or linked articles about how this may be occurring.

  3. Byron Smith says:

    Indeed, they are credited with having invested the derivatives market in oil and gas
    I assume you mean “with having invented”.

  4. nyc-tornado-10 says:

    Perhaps the chance that obama could expose the koch’s funding of the republicans is why the cato institute just released the report that said obama is not resposible for high gas prices, they do not want to pick a fight on this issue.