Republicans are getting ready to capitalize on record prices at the pump with a May focus on oil and gasoline. The government shutdown battle put the issue on the back burner even though prices at the pump have been rising steadily since February. Now, with President Barack Obama already on the defensive, the GOP is ready to pounce. House Republicans are planning bill introductions, hearings, markups and floor votes on legislation aimed at expanding domestic oil production in response to high gasoline prices.
Politics is politics, but for the sake of improved public understanding it’s worth underscoring the fact that the only way government impacts the price of gasoline over the long and medium term is through taxes. And America already has basically the lowest gasoline taxes in the developed world, a policy that’s currently starving our transportation infrastructure. The basic gas price problem we face is that the American economy is growing slower than the global average. China and India are both poor enough to grow faster than we do, and large enough that rapid growth from a small base has an appreciable impact on the worldwide total. If we ask them nicely to stop growing so quickly and they choose to comply, then natural resources will start becoming more affordable. If not, then not.