Popping the gas bubble: How Obama could lower gas prices

Today, on my way to work, I became so angry I nearly caused an intentional car wreck. $4.16 per gallon of gas — what the hell is this all about?

Only two things make me this filled with rage: gas prices and taxes.

Listen: I’m not a wealthy man and I drive everywhere — to work, to campus, to my neighbor’s house.  My grandma’s Buick is really the safest way for me to get from point A to B. I’ve seen the way you people drive.

Some people tell me, “Hey! You live within a 15 minute walk to work and only 10 minutes from campus. Why must you drive? Walking or riding a bike would be much more economical, you get some exercise and it’s safer for the environment.”

I think we all understand the many benefits of leaving your car parked, but think about the costs. Saying it’s scorching in the summer is an understatement. It’s like the sun is Bloomington’s BFF and they’re getting all hot and bothered. Best case scenario of leaving the AC behind and venturing outside, you just become a sweaty mess. Worst case — you die.

Now how can we blame Obama for high gas prices?

I’m not sure if we can and that scares me.

The president doesn’t really have a lot of clout in this situation. He cannot will prices down by waving his finger or by telling oil companies to make less money.

Economic theory says he could support a price ceiling that brings the price down to some socially acceptable level. But then we’d have shortages causing long lines at the pump.

He could do a federal gas tax holiday, like what McCain suggested in 2008, but that would only take the price down a few cents and the long run loss to road budgets could be costly.

Lots of people think that eliminating oil subsidies will bring down the price of gas, but you’d have to be an idiot to think that would drive down the price. I agree that the government should end the handouts, but it will not positively affect prices.

The corporations will just increase prices to make up the financial loss of removing the government aid. Even if the government transferred the year’s $4 billion in subsidies back to the American people, we’d each only get a check for $11, which wouldn’t even buy half a tank of gas.

John T. Harvey at Forbes magazine thinks the rise in the price of gas is a result of the financialization of the commodities market starting in the 1980s. He suggests that oil speculators, using an unregulated financial instrument, are driving the prices artificially high.

It looks like oil futures might be another nasty white-head bubbly pimple on the face of America. If Obama wants to burst the oil pimple he must impose stricter regulations on commodities.

I support the idea; I just don’t want to be in the room when it happens.

­—  nicjacob@indiana.edu