from Energy, Security, and Climate and Energy Security and Climate Change Program

Americans Don’t Seem to Want Lower Gas Prices

March 27, 2012

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Blog posts represent the views of CFR fellows and staff and not those of CFR, which takes no institutional positions.

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It’s difficult to open a newspaper or turn on the TV without hearing that Americans are apoplectic about skyrocketing gas prices. If ever there was a moment to channel public anger toward policy progress, this would seem to be it. So I was intrigued to see a new poll from Hart Research Associates, commissioned by the Center for American Progress Action Fund, which tests a series of messages about gas prices and policy responses to see which ones would work best.

The poll’s sponsors seem to be excited by the results, writing that “the strongest policy solutions are the ones being advocated by progressives”. But here’s what they find:

The four policies that voters most believe can help a lot with addressing gas prices are:

  • American Oil for American Soil. Require oil companies to use the oil that is produced in the United States from public lands and offshore to meet energy needs here at home, and stop oil companies from exporting oil from our public lands and waters to overseas markets. (60 percent [support])
  • End Oil Subsidies. Repeal the four billion dollars per year in federal subsidies that currently are given to the oil companies, and use that money instead to fund investmentsthat will make us less dependent on oil. (55 percent [support])
  • Crack Down On Excessive Speculation. Tighter oversight and regulation of Wall Street speculators to prevent them from artificially driving up the price of gasoline. (54 percent [support])
  • More Fuel Efficient Cars and Trucks. Increase fuel-efficiency standards for cars and trucks, so they get more miles per gallon and consumers will save on their gasoline costs. (49 percent [support])

Let’s take these one at a time.

The United States exports a minuscule amount of crude oil (no more than sixty thousand barrels a day at any time in the last decade), most of which doesn’t come from public lands, and all of which is traded for logistical reasons that save Americans money at the pump. That makes “American Oil for American Soil” at best a solution to a non-existent problem.

Ending unwise oil subsidies would be great. There is also zero chance that it would reduce gas prices, let alone “help a lot with addressing” them.

There’s a better case to be made when it comes to excessive speculation, which at least might be a real problem – it’s tough to argue that there isn’t some dumb money distorting prices on short time scales. But there’s no evidence that “excessive” speculation is a big part of what’s driving up the price of gas, particularly over the longer run. Economic fundamentals, along with fear of conflict over Iran , are the big culprits today. “Cracking down” on “excessive speculation” would do little to the price of gas.

The only genuinely powerful proposal among the four that the poll flags is the fourth: increasing fuel efficiency standards for cars and trucks. Yet even with a nudge (the poll question points out that the standards would help consumers “save on their gasoline costs”), fewer that half of Americans seem to be on board.

This is all deeply dismaying. People say that they want lower gas prices, and of course, I don’t doubt that that’s true. But they don’t seem all that interested in pursuing policies that might deliver them – instead, they seem more interested in gimmicks and distractions. Perhaps Americans don’t really want lower gas prices after all.

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