Republican presidential candidates have shifted the general election debate to rising gas prices amid an improving economy and 24 consecutive months of job growth in the private sector.
They have argued that the president has not done enough to expand domestic energy production, despite the fact that there has been more oil produced on land and offshore than at any other time in the last eight years.
Former Speaker Newt Gingrich has made lowering the price of gas to $2.50 a centerpiece of his presidential campaign. And on Thursday, Mitt Romney appeared on Fox News to reaffirm his support for drilling in ecologically sensitive areas, such as the Arctic National Wildlife Refuge, the Gulf of Mexico and the American West.
“I mean, it’s very clear this president does not want carbon based energy flowing in this country,” Romney said in an interview with Sean Hannity. “Instead he wants to drive prices up, and that’s what’s happened so that his windmills and solar companies will be successful.”
Critics say it would be very difficult, if not impossible, to achieve energy independence by relying exclusively on hydrocarbons. America uses 20 percent of the world’s oil, but has only two percent of the world’s petroleum reserves.
The price of gas – even gas produced domestically – is determined by global market forces, which expose it to speculation and volatility beyond the president’s control.
President Obama criticized his opponents’ “three-point plan for two-dollar gas” and took the opportunity to call on Congress to end subsidies to the oil and gas industry. He pointed to $4 billion in tax breaks against a background of record profits and high gas prices.
A gallon of unleaded gasoline climbed to $3.83 on Friday, up 33 cents from a month ago, according to AAA. Meanwhile, ExxonMobil Corp.’s net income last year was $42.2 billion, up from $31.4 billion in 2010, while Chevron Corp. posted a record $26.9 billion in earnings for 2011.
Democrats on Capitol Hill have painted the tax breaks as waste at a time when the ultra-right insists on enacting austerity measures, but GOP lawmakers have been quick to defend corporate interests.
Supporters of the tax break claim that jobs and future exploration will be jeopardized if the subsidies are taken away.
House Republicans unanimously blocked legislation last May that would have eliminated oil and gas subsidies. The motion was introduced by Democrats who sought to attach it to a bill, which passed, that would give oil companies easier access to permits in the Gulf of Mexico.
A proposal in the Senate by Sen. Robert Menendez, D-N.J., that would have ended several tax breaks to oil companies and saved $21 billion over the next decade also failed.
“I expect Congress to vote on ending these subsidies,” Obama said in his weekly address on March 17. “And when they do, we’re going to put every single member of Congress on record: They can either stand up for oil companies, or they can stand up for the American people.”
Obama will travel to Nevada, New Mexico, Oklahoma, and Ohio this week to outline the steps that have been taken by his administration to increase oversight in the energy markets and reduce fraud and manipulation that distorts the price of gasoline.
He has called for an “all-of-the-above strategy” which aims to raise fuel efficiency, curb speculation, and develop a range of green technology in order to further reduce America’s dependence on foreign sources of energy.
Photo: Henry Rice of Atlanta pumps gas. Prices continue to rise. David Goldman/AP