Home Energy and Environment The Democrats’ Real Nightmare: $5 Gas Not $14 Trillion Debt

The Democrats’ Real Nightmare: $5 Gas Not $14 Trillion Debt


By Paul Goldman

Cheap energy built this country – and its politics; that’s a fact. Which is why if gasoline goes to $5 a gallon and stays there, the $14 trillion national debt will prove to be the smaller political number.

The future is now: The Democrats had best worry about the price of gas at the pump come next year. Every penny north of $3 a gallon on a sustained basis is trouble.

Now, $6 a gallon gas (as the Drudge Report is promoting) on a sustained level would probably require a scary geopolitical event. But the oil market is still run by a cartel at the margins, and furthermore, there are refining capacity issues, not merely production matters.

Forget green and all that for the immediate term: there is no alternative energy fix for the 2012 political cycle if gas at the pump starts freaking out voters.

Political bottom line: Let’s do the math.

Every PENNY over $3 a gallon on a SUSTAINED basis beginning with the late fall of this year is a problem for Democrats. It’s manageable but it poses risks of a spike at anytime — like, say, a few weeks before voting.

North of $4 puts the President and Tim Kaine in big trouble here in Virginia. Suburbanites are the swing voters, and they will have to fill up their tanks the week before voting. Every penny over $4 starts costing the President electoral votes he ultimately can’t afford to lose.

North of $5 means a  reasonably – I didn’t say completely – sane GOP presidential candidate has to be considered the favorite to take the White House.

$6 and over? As long as we don’t end up with President Gingrich or Palin, we will have reason to be thankful.  

  • …there’s not much anyone can do about gasoline prices in the short term.  Release oil from the Strategic Petroleum Reserve? That might help for a few weeks or months, but it’s not the answer. Offshore oil drilling? That will take years to ramp up, even if the amount of oil there were sufficient to make a difference of more than pennies a gallon (and it’s almost certainly not). Jawbone OPEC? Other than the fact that OPEC’s already pumping pretty close to capacity, why would the Saudis have any incentive to help us at this point, given what just happened to their friend Husni Mubarak, and given how much money they’re making off $100 per barrel oil? Ramp up electric vehicles and hybrids? Fine, but that will take several years to have a significant impact on U.S. gasoline consumption, and hence prices. Any other ideas at the federal or state levels in the short run? I don’t have any, and I doubt anyone else does either. Bottom line: as long as we remain addicted to oil, our economy and our politics remain at the mercy of its vicissitudes. It’s been that way for a long time now, hard to see how it changes in the next few months or before the 2012 elections.

  • kindler

    I find it quite interesting that the same people who always tell us that the free market is God always end up howling the loudest when gas prices go up.

    Can’t we just invade another Middle Eastern country?  Clearly three is not quite enough.  

  • totallynext

    Seriously.  How is the price of Gas, tied to a political party – especially the Democrats.

    this is a strawman argument.

    Rep in house – prices went up to $4

    Demps in house – prices went down to 2-3

    Rep back in majority – prices are going to $4 and beyond.

    I believe the political argument could actual go against

    the Republicans in the house – their codifing the oil industry removing market safe guards has allowed speculators to push up the market price of oil.

  • kindler

    …low taxes, unlimited government services and global military dominion — what a wonderful fantasy!

    Wouldn’t it be better to have leaders who talk to us like adults with the maturity to make rational choices rather than having them continue to treat us like 3 year olds allowed to live in an unsustainable dream world?

  • we had a huge spike when the recession was taking place.  tens of thousands of jobs lost a month and prices spiked.

    if they were oil commodities markets were truly and indication of future demands, they would have gone down.

    investigate now!