Some amount of spin is to be expected during the campaign cycle, but the idea that President Obama is somehow responsible for the rising price of gasoline over the last three years really irks me—perhaps because this particular myth is so easily dispelled.
Republicans like to point out that the price of a gallon of regular gasoline was $1.85 the day Obama took office (the same price, coincidentally, as on the first day of George W. Bush's second term four years earlier). What they don't mention is that the price of gas rose steadily throughout Bush's presidency, peaking just five months before Obama's inauguration at around $4.11—a difference of over 120 percent. So what happened in September 2008 to send the price of gas plummeting?
Well, for starters, the entire global financial system collapsed in 2008, following a year of accelerating downturn in the U.S. housing market. On September 7, the federal government effectively nationalized Fannie Mae and Freddie Mac, which together owned or guaranteed about half the nation's $12 trillion mortgage market, and about a quarter of all subprime loans. Lehman Brothers filed for bankruptcy a week later, precipitating a wave of bank failures and ratings downgrades throughout the month. By October the economy was shedding upwards of 50,000 jobs a week. Global petroleum consumption plummeted as the recession deepened, wreaking financial havoc among oil-exporting nations and driving prices to their lowest levels in six years.
The average price of gas in the United States bottomed out at $1.61 a gallon just three weeks before President Obama took the oath of office. Market volatility (and political tension with Iran) aside, almost every increase in price since January 2009 can be attributed to the strengthening of the world economy, and the U.S. recovery in particular.
For the last year, gas has averaged $3.57 a gallon, about 50 percent higher than the 2004–2008 average and about the same level as in the spring of 2008. That's not cheap by any means, but it's also not much different than the last two years of Bush's presidency.
Unfortunately, there's not much that President Obama or any other politician can do about that. Although the United States has increased production of oil and petroleum products about 20 percent since 2008, according to the Energy Information Administration, that amounts to only 11 percent of the world's supply and about half the amount Americans consume.
That means that however much we expand domestic exploration and drilling, the price of gas will continue to be determined by changes in global supply (which is limited) and demand (effectively unlimited). The only true solution, as Obama has repeatedly pointed out, is eventual independence from fossil fuels.
Graph: The One Graph That Proves Gas Prices Didn’t Surge Because of Obama
Some amount of spin is to be expected during the campaign cycle, but the idea that President Obama is somehow responsible for the rising price of gasoline over the last three years really irks me—perhaps because this particular myth is so easily dispelled.
Republicans like to point out that the price of a gallon of regular gasoline was $1.85 the day Obama took office (the same price, coincidentally, as on the first day of George W. Bush's second term four years earlier). What they don't mention is that the price of gas rose steadily throughout Bush's presidency, peaking just five months before Obama's inauguration at around $4.11—a difference of over 120 percent. So what happened in September 2008 to send the price of gas plummeting?
Well, for starters, the entire global financial system collapsed in 2008, following a year of accelerating downturn in the U.S. housing market. On September 7, the federal government effectively nationalized Fannie Mae and Freddie Mac, which together owned or guaranteed about half the nation's $12 trillion mortgage market, and about a quarter of all subprime loans. Lehman Brothers filed for bankruptcy a week later, precipitating a wave of bank failures and ratings downgrades throughout the month. By October the economy was shedding upwards of 50,000 jobs a week. Global petroleum consumption plummeted as the recession deepened, wreaking financial havoc among oil-exporting nations and driving prices to their lowest levels in six years.
The average price of gas in the United States bottomed out at $1.61 a gallon just three weeks before President Obama took the oath of office. Market volatility (and political tension with Iran) aside, almost every increase in price since January 2009 can be attributed to the strengthening of the world economy, and the U.S. recovery in particular.
For the last year, gas has averaged $3.57 a gallon, about 50 percent higher than the 2004–2008 average and about the same level as in the spring of 2008. That's not cheap by any means, but it's also not much different than the last two years of Bush's presidency.
Unfortunately, there's not much that President Obama or any other politician can do about that. Although the United States has increased production of oil and petroleum products about 20 percent since 2008, according to the Energy Information Administration, that amounts to only 11 percent of the world's supply and about half the amount Americans consume.
That means that however much we expand domestic exploration and drilling, the price of gas will continue to be determined by changes in global supply (which is limited) and demand (effectively unlimited). The only true solution, as Obama has repeatedly pointed out, is eventual independence from fossil fuels.