Gas Prices And Deregulation: George Bush's Legacy
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Someone asked as a request whether the rise of gas prices is tied to a Bush being into office. The simple answer is yes, but not for the reasons that you would think.
Politics aside, there appears to be a connection with a Bush being into office and the rise is gas prices. I am not, however, like so many of my liberal friends who believe this is due to a corrupt intention to manipulate the gas prices by the Bush family. Instead, I believe it is a change in regulations.
Generally, Republicans want as little regulation as possible over American business. This is also known as the free market approach. The current Bush ran a deregulator believing that the market could better regulate the economy that the government. For the most part, I actually believe this is a valid contention. However, I do not believe this theory works when it comes to energy.
In the early part of this decade, California deregulated power. What was seen as a way to promote competition in the marketplace became an economic disaster. California no longer had enough energy and experienced rolling blackouts. Prices rose out of control. There was no competition. This is due to the fact that there are only a few producers of energy.
The same is true for oil. There are very few countries that can produce the amount of oil the United States uses. Granted, many countries have oil, only a few companies control its output. Without government regulation, these companies have complete control over the price.
Now I believe in alternative energy. But it is not here yet. Alternative energies are not yet cost effective or feasible. The Bush administration did nothing to move it along and showed no interest to do so. This meant that the oil producers knew that there would be no regulation of gas and no competition. This leads to the price going up under any economic model.
So yes, it is coincidence, but not by corruption. If President Bush had not been so anti-regulation and pro-market, the prices may have remained stable. But given the various wars, the use of oil by the military in those wars, and a complete lack of discovery on alternative fuels, the prices we paid a few months ago was inevitable. And now, in Bush's last days, the prices are higher to get some last minute profits before regulation returns. Hopefully, we will push for alternatives as well. We will see.
Just my rant. I may be wrong.
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Thanks.
good hub
Thanks
Regulation is not a bad thing. I liken it to what would happen if all traffic lights were turned off and stop signs taken down. Total chaos, of course, where only the biggest vehicles and most intimidating drivers would get through interesections. Pretty much what happens to the price of oil when a Repug is in office. Just as traffic lights and signs keep traffic flowing smoothly, regulation of industries that serve the general public keep the monster trucks from hogging the road. We've just seen what DEregulation did to the economy.
Had Bush been a real president last summer, one of those executive orders he was so fond of signing could've have dropped gas prices *for national security*. Such a weinie. So glad he's GONE!
I am glad as well, even written a few hubs on my celebration of change. One thing that is interesting is here in California, everytime the Attorney General says he is going to look into gas prices they drop by twenty percent within a week. Even the threat of regulation seems to regulate the price. My problem with President Bush's policies is that it was obvious nothing was going to be done and "market forces" would go unchecked. Think history will show that this much of a hands off approach on necessities (gas, food, housing, finanical) does not work.
Thanks for reading.
bgpappa
LOOKS LIKE YOU WROTE YOUR HUB 17 MONTHS AGO sometime in Feb.
Let's clear up some facts about the high price of gas.
2007 the Democrats took over control of Congress (spending and legislation ).Pelosi and Reid passed legislation to produce ethanol, ethanol is made from corn. Corn was taken out of the food chain causing a world shortage of corn and higher food prices.
2007 a barrel of oil was $ 56.00.The Dem's shut down production of US oil by denying permits and additional regulations favoring alternate fuel production.
The smart people on wall street, Goldman Sachs, pension funds and other connected big money speculators jacked up the oil prices from $ 56 to $125 a barrel. Lot of them and foreign oil producers made a lot of money. Gasoline prices sky rocketed to $4 a gal if you can remember. Trucking cost went up, food prices went up and people and businesses started to layoff people.
It only took 2 years of the Democrat Congress to mismanage the economy at the expense of a lame duck president ( BUSH ).
End result of higher food ,higher gas and people unable to pay their mortgages led us up to the present recession.
2010 the Dem's win the Presidency and win a Super majority of Congress hence the Republicans don't count in drafting legislation. 2007 unemployment was 4.6%, 2008 6.7% (recession started in nov 2008),2009 10+% and now in 2010 9.7%.
Let's hope that this Congress and president Obama will finally try to find the jobs that were promised in 2008.
That's past history, the future is what is now important.
Check it, advise please if I errored.
Funny, George Bush was President for eight years, yet he seems to never receive any blame for anything that happened in those eight years. But in this hub, I don't actually blame Bush for anyting other than what his policy was: as little regulation as possible and the oil market reaction to that policy perspective. But you can't wait to spin that in two years democrats caused a financial crisis that began in 2006.
When Bush took office the price of oil was about $25 a barrell. In 2003 the price rose above $30 after the invasion of Iraq and by 2005 the price reached $60. Yes, the peak was in 2008, six months after the democrats reached office, but do you really expect anyone to believe that six months was the cause of the gas crisis. The rise in gas prices was a constant strain on the economy and my pocketbook once Bush reached office in 2001. Again, this was market forces at work, some would say this was good. Unchecked market forces couples with the increase of demand due to the waging wars and Hurricana Katrina caused a spike. Plus, you can't forget the contining increase demand from new consumers like China, India and others. It is important to note that Between 2004 and 2007, the profits of the six major oil companies - ExxonMobil, Total, Shell, BP, Chevron, and ConocoPhillips - totaled $494.8 billion.
It is also important to note that in March 2008, or two months after the democrats took over Congress, OPEC accused the United States of economic "mismanagement" that was pushing oil prices to record highs.
I have not heard the "corn theory" before but would be willing to review it if you were kind enough to provide a link.
Thanks for the comment.
bgpappa
YOU SAID '' note that in March 2008, or two months after the democrats took over Congress, OPEC accused the United States of economic "mismanagement''
NOTE Democrats took over Jan 2007 as I reported. It took the dems just a little over 1 year to foul things up.
you said '' the profits of the six major oil companies - ExxonMobil, Total, Shell, BP, Chevron, and Conoco Phillips - totaled $494.8 billion.''
When companies make profit, that's not bad as the politicians want you to believe. The oil company profits were about 3% on their investment, that's not out of line with industry standards.
Now keep in mind that the Government( taxpayers ) got maybe 50% of those profits for the treasury. Question how did the Government spend our money. If you can remember there was a call to suspend federal gas taxes (17% on a gal. of gas )when the gas prices were $4.00/ GAL.THE GOVERNMENT DID NOT ACT.
The oil speculators knew that the Democrat Congress would not approve more US drilling. High gas prices helped the ignite the recession in Nov 2008.
Google Ethanol, Corn Ethanol
Senator Majority Leader Harry Reid's bill, S. 1419, the "Renewable Fuels, Consumer Protection and Energy Efficiency Act of 2007 includes requirement to produce 36 billion gallons of biofuels by 2022, nearly five times the 7.5 billion gallon ethanol mandate targeted for 2012 included in the Energy Policy Act of 2005.
ENJOYED YOUR COMMENTS. YOU ARE HOPEFULLY GETTING OUT OF THE SPIN AREA.
I don't think I do spin anything, I will rail against a dem just as fast as a republican. Just so happens I think you are wrong on this issue. Laid out the fact, youi didn't really disagree, except for 2007 which I humbly admit I spaced on.
Oil companies don't pay 50 percent taxes, maybe in theory, but not in reality. And I have nothing against anyone making a profit, but when prices are rising because of higher costs, demand is down (which it was when prices rose) and you still manage the biggest profit ever, then something is amiss.
By the way, there are over 4000 shallow water wells on US land. Just an interesting fact I learned from fox news today.
Thanks for the ocmment.
Oh, but you should blame Bush for a lot more not just the price of gas. Did he bring any oil back from his fiasco in Iraq?
P.S. Don't listen to Jon, he makes no sense; not here and not much in the forums either, but he likes to talk and talk and talk, so we let him...
I do blame Bush for much more, but this was just one example.
Thanks for reading
You asked for it
YOU DWELL IN THE PAST,THAT'S ALL HISTORY NOW.What has Obama done in the last 19 months that can't make people forget about Bush? The tarp bailout money has been repaid with interest ( saved the country going over the edge ).That means that the Bush deficit is only $600 billion, down from $1.3 billion (tarp bailout).Barak Obama has spent 3x as much as Bush did and still we have 9.7% unemployment,14.5 million out of work and an economy that has yet to recover.
We don't even know what the 2011 budget is, guess it must be bad for the Democrats and President Obama.Obama promised open and transparent government.The people have to be patient,it's hard work and it will take some time to correct what the last administration left us with.
Sounded a lot different when Barak Obama was a candidate.
Consider I wrote this hub before Obama was sworn in, you are a little late to the party. But isn't it interesting that you never, and I mean never, want to talk about Bush's legacy. According to you he has no legacy, it didn't happen. Funny.
bgpappa
What is the Bush legacy, can you reiterate for the world to see?
Um, wrote the entire hub about it. Read it again if you have to. But the Great recession, two badly managed wars, one brought on by fraud, Katrina, deregulation, all Bush legacies.
bgpappa
I don't believe you have many people believing all that.
Bush apparently didn't do much good while he was president.THERE IS TWO SIDES OF A COIN,did he do anything right or good? Let's try to be fair and balanced for once. the whole truth and nothing but the whole truth will set you free!
See unlike you, I am able to see some good even in those of which I disagree. Bush was great in the weeks after 911. Showed great leadership, did a lot to move the country forward mentally and emotionally. The scene at ground zero was one of the best Presidential moments in our history in my opinion. Not to mention that President Bush has a wonderful family, by all accounts is a great dad (something that is important to me). I don't need CNN or Fox to tell me those things, nor do I need talking points. Just my opinion. However, Bush made a lot of mistakes, some by admission, and the lies told to go to war in Iraq are simply unforgiveable.
Yes, there are two sides to every coin. Its funny that you would point that out as you never blame Republicans for anything and Democrats for everything. As for not many people believing it, you have to be kidding. Perhaps none of your friends, but a vast majority of the country, Bush's approval ratings were below those of Nixon and Truman. Obama's 42 percent would have been a welcomed site in the Bush White House.
bgpappa
In my hubs I only point out the facts,there is enough blame to go around when we discuss our corrupt government in Washington.
Right. Sure.
bgpappa
Please '' let me be clear '', be more specific as to the lies that you claim that I have written. Don't be vague, allow me to follow your sources,be more to the point if you can.
I have listed them over and over again. But I never called them "lies." Spin, half truths, you know, what all Washington people do. Blaiming Obama for everything, Bush for everthing using facts that don't support your argument. Not a lie, just spin.
I have listed them over and over again. But I never called them "lies." Spin, half truths, you know, what all Washington people do. Blaiming Obama for everything, Bush for everthing using facts that don't support your argument. Not a lie, just spin.
bgpappa
According to your interpretation, there is a difference. If you had the opportunity to catch President Obama on the campaign trail the last 3 weeks, maybe you can clear up the spin and the lies for your readers.
Ugh, ugh, ugh,
bgpappa, Bush did not deregulate, Reagan administration did and ever administration carried on including Clinton administration as well it seems lefties forget Clinton bombed Iraq before.
DJ, Bush did deregulate. Yes, Clinton bombed Iraq, but he didn't invade the Country under false pretenses.
Thanks for stopping by.
I read that a barrel of oil was traded 27 times before it reached its final destination in 08 when gas was up to $4 a gallon. So I guess Wall street is at it again? I think if you take all of those fingers out of the pie oil would be about $35 a barrel. The SEC is a dog and pony show so until the general population gets off their a** nothing will change.
Agreed Modern,
Either we change our ways or stop complaining I guess. Thanks for the comment.
bgpappa
Jon EWall rebutted you with facts and all you could do is counter with liberal talking points.
And which "facts" and "liberal counter points" do you refer. Some specifics would be nice.
babyfee 3 years ago
Its a great opinion.