President Obama Keeps His Promise

President Obama promised to make energy prices skyrocket, and he has succeeded. Gasoline prices have more than doubled since he took office, despite the fact that unemployment has averaged more than 8% during his presidency.

Despite skyrocketing prices, the White House releases very low inflation numbers every month.

ScreenHunter_1132 Jul. 19 08.44

About stevengoddard

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51 Responses to President Obama Keeps His Promise

  1. Pathway says:

    It would be interesting to see if there is a correlation between the price of gasoline and quantitative easing.

  2. mjc says:

    Up until a week or so ago, most places around me were well over the average price/gal…somewhere in the neighborhood of $3.90/gal. Couple that with the fact that the EPA has basically declared war on the largest part of this state’s economy (WV) and you can see what’s going to happen here…

  3. policycritic says:

    The bastards could have locked in a 50-year supply of gas at the 12/31/08 prices with logical and reasonable inflation built in, but no. Both the Republicans and Democrats shirked their public duty, and the only thing concerning the newly formed Tea Party in February 2009 was getting the Darkie out of the White House. A pox on all their houses.

    BBC reported in early 2009 that speculators were buying up all the oil/gas futures to set the price of gas at the pump in perpetuity. Not one single member of our genius Congress raised a red flag.

    • _Jim says:

      1) I think you’re suffering from a really bad case of anachronistic fallacy; Rick Santelli ONLY made his notable remarks in February of 2009.
      http://en.wikipedia.org/wiki/Rick_Santelli#.22Chicago_Tea_Party.22_remarks

      2) Half Darkie (or weren’t you aware?)

      3) Wasn’t all of congress in the hands of the dems in 2009 (Ans: yes)?

      http://en.wikipedia.org/wiki/Party_divisions_of_United_States_Congresses

      • policycritic says:

        You’re right, all of Congress was in the hands of the Dems in 2009, but the previous Congress could have locked in energy security in 2008. I’m not saying Repubs or Dems are better. I am faulting Congress–period–for failure. They’ve done the same dumb things with respect to rare earths, which we were the leader of in 1984 until Clinton flicked the industry off the table in 1993/4, and now we’re scrambling to find supply for essential military and commercial projects.

        • _Jim says:

          How, exactly, could congress have ‘locked in energy security in 2008’?

          By planning and executing a nationwide network of nuclear power plants? In my book, that is the ONLY way that could happen.

          .

    • Tel says:

      Quote from above:

      … the only thing concerning the newly formed Tea Party in February 2009 was getting the Darkie out of the White House.

      This is bull, the early Tea Party were focused on trying to reduce government spending and lower taxes. Since then they have expanded this to illegal migration as well. Stop making stuff up and be honest for a few seconds.

  4. Rob Ryan says:

    Holy crap! Darkie?? Really??

    Anyway, this chart is cherry picking at its finest. If you’d extended it back a mere six more months, the ordinate would have been around $4.10. As to unemployment, Obama’s predecessor took over at about 4.7% and turned over the keys at about 9.3%. Do your regulars really buy into these obvious deceptions?

    • geran says:

      Unemployment under Obummer’s predecessor was under 5%. Do you Obummer sycophants really buy into the obvious deceptions?

      • Rob Ryan says:

        I’m no Obama sycophant, never voted for him, never would. I voted Libertarian, will likely do so again. I just don’t condone obvious deception. You don’t have to be an Obama sycophant to not buy transparent bs. There were times when the unemployment under Bush was under 5% but in February of 2009 it was about 9.3%.

        The gas price chart presented in this post is even more phony.

        • The gas price chart is accurate.

          Unemployment was 4.3% and falling when Dems won control of the Congress in November, 2006. Reid, Pelosi and Obama succeeded in doubling it in only two years, and I will excuse your extreme cluelessness and dishonesty just this one time.

        • Rob Ryan says:

          I’ll be interested in seeing what happens when I’m not excused. Anyway, you’ve moved the goalposts not once but twice. When Obama took office, unemployment (the billboard number whose relation to the real world is tenuous at best, and I suppose you and I might agree on that) was at 9.3%. Your post mentioned Obama, not Pelosi in 2006 and Obama in 2009. Goalpost move number 1.

          Your cutoff of gas prices in the chart that is the real subject of your post couldn’t possibly have been more misleading. Gas prices actually reached their all-time peak in June of 2008 and fell precipitously until the precise time that you chose to begin your chart. But you haven’t even tried to justify that, the main point of your original post. Goalpost move number 2.

        • Gas prices were below $2 on the day Obama took office. Dems created 10% unemployment and doubled gas prices – a feat which even Jimmy Carter couldn’t hope to aspire to,

        • Rob Ryan says:

          Sure, the chart is accurate. It’s just deceptive, as I’m sure you know.

          Of course, Bush managed almost to triple gas prices, taking them from about $1.51 in January of 2001 to $4.16 in July, 2008, after which they crashed to $1.83 in January of 2009. What a coincidence that your chart starts there. Under Obama, they’ve never managed to achieve the peak that Bush was able to reach though. Bush was equally successful with unemployment, taking it from 4.7% in 2001 to 9.3% at the beginning of 2009. Perhaps, with a little more effort, he could have doubled it.

        • policycritic says:

          @stevengoddard,

          Just a FYI. “doubled gas prices – a feat which even Jimmy Carter couldn’t hope to aspire to.” Actually, it was Jimmy Carter deregulating natural gas in 1978 (yeah, I know it “soared” from $0.30 to around $2.72) that caused the power plants to retool from oil to natural gas over the next three years, and broke the back of OPEC. Oil was over $30/barrel then, up from $3.00 in 1973. Reagan got all the credit, but it was Carter who did it. Oil was down to $10/barrel by 1990, as a result.

        • So gas prices were below $2.00 when Obama took office but they weren’t below $2.00, and it is all Bush’s fault. Thanks for clearing that up.

          You might be surprised to learn that other people don’t live inside your head.

        • SMS says:

          The current unemployment rate reported by the Obama administration is as far from the truth as CAGW. The USA needs to create 175,000 jobs each month to stay even. And these need to be full time jobs, not part time jobs as reported last month.

          There were months during the last election when the job creation number was reported as “zero” and at the same time the unemployment rate went (miraculously) down. That can’t happen. The flaw is in the reporting of the unemployment number where only those taking unemployment insurance are counted. Obama uses this flawed number to cover his incompetence of what it takes to grow an economy. Worst president EVER!!!!

          This man and his administration will lie without regret to make political gains.

        • policycritic says:

          stevengoddard says:
          July 19, 2014 at 8:16 pm

          Hunh? I was just quoting an historical tidbit.

          BTW, the unemployment rate from the Bureau of Labor Statistics from December 2007 to December 2008: from 4.9% to 7.2%.
          http://www.bls.gov/opub/ted/2009/jan/wk2/art02.htm

        • Rob Ryan says:

          While I’m no Obama apologist (see above), the calculation of the unemployment rate, while quite deceptive for the reasons you point out, is not done by Obama. It’s published by the Bureau of Labor Statistics. Numbers more accurately reflective of the true state of employment are easily available there as well.

          Probably the most telling statistic is the civilian labor participation rate (I like to get it from Explistats.com), which has declined from just under 66% to just under 63% during Obama’s tenure. If I were going to make a case for failure of Obama and the Congress, that would be the statistic upon which I’d base that case.

          But that statistic has been on the decline since about 2000, with a hiatus from about 2005 to mid-2008. It climbed fairly steadily from about 1963 until about 2000 under both Democratic and Republican Presidents and Congresses.

          Anyway, this post had been about gas prices. Steven/Tony said something about “were below $2.00” and “weren’t below $2.00.” I don’t know what comment that referred to but there’s no question that they were below $2.00 at Obama’s inauguration. They were way below that at Bush’s inauguration. Until the economy collapsed in 2008, they rose steadily to reach their all-time peak in mid-2008, falling like a rock as the economy tanked by every metric. Other than being a Senator, one of 100, Obama had nothing to do with that crash. I’d contend that that process started with the Newt Gingrich Congress and the Bill Clinton Presidency. There are too many individuals in the pockets of too many entities to go deeper in a comment.

          As an aside, all fossil fuel markets are world markets and the degree of control of prices of such markets by a President or Congress, regardless of party affiliation or philosophy, is minimal at best. An slight exception is natural gas, which is not so easily deployed to the highest paying market. But substitution of oil and gasoline with natural gas for transportation fuel is highly inefficient and problematic.

          I have to move on to more productive uses of my time though, so adios compadres.

        • Since Obama took office, gas prices have more than doubled. How that confuses you is beyond my comprehension.

        • David A says:

          What Tony said, and adding to that, under Obama the gas price has consistently stayed very high, which it did not under Bush, opening the possibility that the Bush increase was due to temporary geo political reasons, and the Obama increase was due to his poor energy policy. Indeed, if not for the private boom in Natural Gas, Obama’s promise to raise energy prices would be even more successful. Also, a key Obama admin adviser has stated that he thinks our gas price should be as high as Europe’s. (sorry, no link to that tidbit) For the reasons above I think Tony’s chart is fair. Their is little doubt that open to domestic fossil fuel production program could have kept the price of gasoline lower.

          Regarding Bush’s end of term unemployment, Yes, under democratic controlled congress, and under the monetary supervision of the Senate finance committee, we had a mortgage crisis, primarily caused by Janet Reno Law suits forcing lowered lending standards, and by bundled mortgage securities being far over leveraged, led by Government sponsored enterprises led by well funded democrats. Clinton further chipped in with his signature on the republican sponsored repeal of protective legislation. These actions, along with three democratic refusals to address the mortgaue issues, brought up by Bush, resulted in the high unemployment numbers.

          regarding the participation rate… It was not dropping near as sharply in after 2000, before increasing under Bush. The Obama policy logically reduces the participation rate, and in fact has far more then under Bush Under Obama there has been no real recovery in the participation rate.

        • philjourdan says:

          It was not 9.3% in February 2009. I hate liars. If you love obama, admit it. ANd stop lying.

          The $4.01 was when the gulf shut down due to Katrina. It fell faster than it rose. Gas has not fallen under Obama, and there have been no serious hurricanes since he has been in office.

    • policycritic says:

      “Darkie?” Yes. Whether you like Obama or not, there was a considered racial element to objecting to him based on his color alone as soon as he took office. Which I found objectionable and despicable. Perhaps I should have used the /sarc tag, and included the monkey cartoons that abounded in the 1Q of 2009.

      I disagree with your complaint about where the chart started. We all remember the higher gas rate in the summer of 2008. That only underscores the point that the Dec 2008 price was so low. Why? If it could go that low, why couldn’t it stay there? It certainly wasn’t production-based. What financial shenanigans were at play raising the price so significantly within two years?

      • Your bigotry is unacceptable here.

      • policycritic says:

        But I don’t have bigotry towards conservatives. It is patently clear that the Democratic congress–pre-2009, or post-2009–could have locked in energy security at the low year-end 2008 prices by buying up future supply on a 50-year basis the way any other intelligent government would do facing scarcity or rising prices. It was a Republican government on one side of the 2008/2009 divide and a Democratic one on the other. And, yes, I was screaming about this back then, just as I noticed the Chinese buying up all remaining rare earths supplies worldwide. “Lock in the low prices.” Somewhere on one of my computers I have a BBC report about how futures traders then were locking up the supply, and it should have been stopped.

        I just think that Rob Ryan’s argument that the chart should have started in the summer of 2008 to be specious.

        • Rob Ryan says:

          I didn’t say that. I only said that where it DID start was deceptive. Heck, I’d start it in, say, 1960 and adjust for inflation. Even that is fraught – what inflation statistic should be used? How about a chart from 2000 at least though.

        • _Jim says:

          could have locked in energy security at the low year-end 2008 prices by buying up future supply on a 50-year basis

          How exactly would that work anyway?

          You keep repeating the same thing, manically, over and over. To my knowledge, ‘futures’ markets don’t work that way.

          Again, what are you talking about?

          With democrats A MAJORITY IN CONGRESS at that time it would not have happened anyway.

          .

      • policycritic says:

        _Jim says:
        July 19, 2014 at 9:04 pm
        could have locked in energy security at the low year-end 2008 prices by buying up future supply on a 50-year basis

        How exactly would that work anyway?

        You make deals with Saudi Arabia, Venezuela, Canada, etc for output capacity over time. It’s done all the time. it’s called locking in your supply.

        You keep repeating the same thing, manically, over and over. To my knowledge, ‘futures’ markets don’t work that way.

        No, futures markets don’t work that way. Governments don’t need futures markets. China just bought up the 35-year future output of some mineral in Africa by negotiating with the government in question.

        With democrats A MAJORITY IN CONGRESS at that time it would not have happened anyway.

        Got that right, probably never even crossed their minds, which is why I fault them.

        • geran says:

          Folks, the idiots are amongst us.

          “No, futures markets don’t work that way. Governments don’t need futures markets.”

          Seriously, the “under 40” crowd actually believes this crap.

      • Mike D says:

        It certainly was production based, or do you have any evidence to say otherwise? A few years ago I looked up worldwide supply and demand and it was straight up supply and demand, to where prices seem like they should have been higher in early 2008. (Though OPEC countries cheat on claimed production so that probably explains it.) The problem is it took cobbling together different sources of production and demand to create the graph so it is not easy to do, and I didn’t save the sources since I never expected to do it again. I think I had to do something like add an OPEC source, to another source that had other country or continent info, with some subtraction for OPEC countries not in the Middle East, or something similar. I think oil use is easier to put together. The data is also chopped up into periods, so it is not pull one report and you have 10 years in one shot. Takes getting each annual report to get the monthly data.

        Here is one annual graph, which shows the obvious gap between consumption and production, which can not be the case in reality. Someone is lying about their production and it is not the major commercial oil companies, it is some governments. I got a much better result, with the lines crossing each other at points the way I did it.

        http://www.indexmundi.com/energy.aspx?product=oil&graph=production+consumption

        Supply growth had been lagging demand growth for something like 3 years straight by early 2008, which is when prices just spiked. Remember when people were claiming the major oil companies and OPEC were cutting production back then? It wasn’t true. They were increasing, just not as fast as demand. Then demand in the western world (US and Europe) declined, while worldwide supply increased through the 2nd half of 2008. Demand slowed in places like Latin America and Asia, but didn’t decline. Then total demand came back to the prior level around the end of 2008 as Asia and other non-western areas kept growing to take over the demand drop from Europe and the US. Worldwide usage has been at record levels for a few years.

        US oil usage is at 1998 levels now. 18.9 million barrels per day. Down from 20.8 million barrels per day in 2005, and 20.7 million for 2006 and 2007.

        http://www.eia.gov/tools/faqs/faq.cfm?id=33&t=6
        http://www.indexmundi.com/energy.aspx?country=us&product=oil&graph=consumption

  5. B says:

    1) Energy prices are not part of the CPI .
    2) Presidential elections may or may line up with the boom-bust cycle. Both teams are in favor of creating bubbles which eventually burst.

  6. Adam Gallon says:

    Our prices for petrol here in the UK, are around £1.30/litre (95 RON). You think you’re prices are high? Diesel’s 4 or 5p/litre more than this.

    • _Jim says:

      Taxes. On account of taxes. Those prices could come down to match ours, as refining costs and cost of raw materials don’t vary that much …

      • Tel says:

        Yeah, prices in Australia are around double what you pay in the USA. A little cheaper for crap fuel loaded with ethanol, and a little more expensive for something that might actually pass as octane.

        Tax is high here, in theory they use it for the roads, in practice we have to pay separately for the roads. Every election cycle they promise to add more tax and this time it will get used for roads… no one believes it of course.

  7. James the Elder says:

    My favorite (?) stats page, each number sourced.

    http://usdebtclock.org/

  8. Tel says:

    Despite skyrocketing prices, the White House releases very low inflation numbers every month.

    Because food and fuel are not counted in the “core” inflation statistics.

    • That’s because nobody buys food or fuel any more. As an example, when Mooch wants a couple of extra racks of ribs to wash down her 15 ice-cream sundaes, she just calls down to the White House kitchen & the food appears. Nobody pays for it, it just appears.

      & when the temperature gets down to 85° in February, she just tells the staff to turn up the thermostats. Nobody pays for that, it’s just a matter of telling someone to turn the heat up.

  9. Rosco says:

    1 US gallon is approximately 3.8 litres.

    Australian prices are about $1.50 per litre and have been for many years. I was in the US in 2006 and the prices I noticed were about $1.30 or similar per gallon. Ours was about the same per litre at the time but this would have been equivalent to about $4.94 a gallon – actually even more than this given the exchange rate at the time.

    I’ll betcha no president will survive $5.70 a gallon prices which is what we pay.

    Our price is based on “world parity” pricing – a policy introduced decades ago to preserve our dwindling domestic supply.

    Since then they have found so much lpg it is indecipherable why our cars are still manufactured to run on petrol.

  10. soulsurfer says:

    US gasoline prices have been increasing since Clinton took office:

    Click to access usa%20gasoline%20prices%20since%20january%201989.pdf

    Like everything else, gasoline prices plummeted during the 2009 market crash. Can’t say Obama is any worse than W. Bush or Clinton… In fact the highest % change were during the latter two administrations.

    • Mike D says:

      The real issue is what are they doing regarding oil. By that measure, Obama is worse as he’s trying to restrict oil production in the US. While Bush tried to increase it, though Democrats kept saying drilling wasn’t the answer, and wells take years to produce oil. Which, is why there’s so much oil being produced in the US right now. Private companies saw the price increase in 2008 and to great extent on private land started to increase drilling years ago.

      Remember Pelosi saying drilling wasn’t the answer, (at the same time saying to release oil from the Strategic Oil Reserve)?
      http://www.reuters.com/article/2008/07/14/idUS183897+14-Jul-2008+PRN20080714

      “The Bush plan is a hoax. It will neither reduce gas prices nor increase
      energy independence. It just gives millions more acres to the same companies
      that are sitting on nearly 68 million acres of public lands and coastal areas.”

      “If the President wants to bring down prices in the next two weeks, not the
      next two decades, he should free our oil by releasing a small portion of the
      more than 700 million barrels of oil we have put in the Strategic Petroleum
      Reserve.”

      Plus, as you noted below, demand is significantly lower than it was before in the US, so the price is not as high as it would be. Thank ridiculous economic policies for keeping economic growth so anemic, that the % change hasn’t been as high as in prior administrations.

      One of the other things affecting US gasoline prices is West Texas Intermediate trades cheaper than Brent Crude, though my understanding is WTI is slightly better grade oil. That’s because WTI is priced in Cushing Oklahoma, and there’s an excess amount there due to the production increase in North Dakota that can’t reach the refiners in Texas. Brent is from the North Sea in Europe. Theoretically, if more oil reached the Gulf, the prices would converge like they’ve been historically.

      North Dakota production growth is astounding.
      http://www.aei-ideas.org/2014/07/may-was-another-record-setting-month-for-north-dakota-oil-as-the-states-daily-output-topped-1m-bbls-for-second-month/

      Obama didn’t build that, and shouldn’t get credit for gasoline prices being lower as a result of it.

      • soulsurfer says:

        Thanks for a thorough political backdrop!

        if you want to know where prices are headed near term (months) and longer term (years) please see here:http://stockcharts.com/public/1269446/chartbook/67200088;

        for those who don’t understand this; it means oil price needs to finish a black major c (higher price; probably at around where the blue V is) over the next months, year+ before it crashes again to new lows comparable to the price drop from blue V to blue A in the years after.

  11. soulsurfer says:

    another way to look at gasoline is how much off it is being used (i.e. sold) in the USofA here are the numbers:

    Click to access us%20monthly%20gasoline%20sales%20and%20co2%20emissions%20since%201983.pdf

    I also calculated the monthly CO2 emissions in Mtons. As you can see, sales (usage) has dropped by 20% (!!) since its peak in august 2005. Hence, CO2 emissions from retail gasoline have followed suit. There are several reasons for less usage (increased efficiency, lower economic activity, etc)

  12. Hugh K says:

    Certainly energy prices have skyrocketed under Obama. To state otherwise is to deny reality.
    The only thing that remains dubious is why the media under Bush reported the reason gas prices rose was due to “Bush/Cheney’s oil buddies”.
    Bush/Chenies “oil buddies” were portrayed in the media as villians, yet the media never makes the connection between Obama and his oil buddies. Oil buddies such as the Dems hundred million dollar man, Tom Steyer. Steyer’s hedge fund which he just stopped managing in 2012, invests in companies that he now rails against. One of the companies his hedge fund invests in even stands to benefit if the Keystone Pipeline is not approved. Coincidently, the President still has not approved Keystone despite the proposed pipeline meeting all environmental concerns coupled with polls showing most Americans want the pipeline built.
    It is clear that Steyer bought the President with a hundred million dollar super PAC donation to the Dems. Yet the media remains silent about Steyer’s making millions through his investments in carbon energy. Why the different treatment in the media between Bush’s oil connections and Obama’s connections? (rhetorical question)

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