Obama in Your Tank
This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.
“Obama Defends Energy Policies” is the headline over a Reuters dispatch in respect of gasoline prices. It reports on the president’s launch of what the British wire service characterizes as “the most comprehensive defense to date of his energy policies.” It says the president is “pushing back against election-year attacks from Republicans” who say his energy policies “are to blame for high gas prices that are eroding his popularity with voters.” The problem with all this is that it’s not the energy policies that are driving up gasoline prices. It’s the monetary policies, and if the Republicans can’t manage to get that point into focus, it’s hard to see how they can put the rest of the monetary debate to their advantage.
We’ve been making this point for months now. The fact is that priced in specie — gold or silver — the value of gasoline has been plunging. We made this point in April last year, after Mr. Obama used his weekly radio address to declare that to rectify rising gasoline prices there was, as he put it, “no silver bullet.” Our point was that a gallon of gasoline was selling at the time for fewer grains of silver than it was selling for when Mr. Obama (or, for that matter, Mr. Bush) had acceded to the presidency. Gasoline at the pump was selling for a sixth of an ounce of silver when Mr. Obama was sworn in. Today, the value of the same gallon of gasoline has fallen to less than a 10th of an ounce of silver. Measured in gold, the value of gasoline has also been plunging.
In other words, it’s not the gasoline that’s been going up. It’s the dollar that’s been going down. Americans, however, don’t hold their money in gold or silver. They generally hold their money in accounts denominated in dollars, and the dollar has been getting weaker. It is the view of the Sun that this fact lies at the bottom of the grim feeling that has swept the country under President Obama, the lingering sense that we are falling behind. We are all for energy policies that maximize the incentives to explore and produce our own oil and gas. But the it’s not going to bring relief to the misery Americans have felt during the Obama presidency until a restoration of sound money.
This is not the kind of issue that the Republican candidates can deal with in a glancing way. Mr. Romney has vowed to replace Chairman Bernanke at the Federal Reserve. Mr. Gingrich has vowed to establish a gold commission, chaired by no less a pair of luminaries than James Grant, who edits the Interest Rate Observer, and Lewis Lehrman, who, with Congressman Ron Paul, wrote a famous dissent from the recommendation of the Gold Commission of the 1980s to stick with fiat money. This issue, if it is to be made to resonate with the voters, will have to be pressed at ever turn, including every time Mr. Obama gets confused and tries to characterize the high number of dollars gasoline is fetching at the pump as a failure of energy policy.