McDonnell weighs in on rising gas prices, White House inactionPolicyVirginia

Virginia Governor Bob McDonnell today issued a statement of concern regarding rising gasoline prices, not-too-subtly laying the blame on the Obama administration for its sins of commission and omission in energy policy.

Said McDonnell:

I am extremely concerned by recent reports that oil and gasoline prices continue to rise and gas could reach an average of $4.25 a gallon by April. Even more than that, I am concerned that the Obama Administration’s ongoing lack of a comprehensive energy policy leaves us vulnerable to continued future energy price spikes and uncertainty in this critical area. When the cost of gas and oil go up, all our citizens and businesses are impacted and any economic recovery becomes far more difficult to sustain.

The Governor added:

The Obama Administration rejected the Keystone Pipeline addition, which would have resulted in thousands of high paying new American jobs; solidified our strategic relationship with our most important trade partner, Canada; and brought vast new, secure supplies of oil into the country, while reducing the potential environmental risks of shipping these resources across the Pacific. At the same time, the Administration continues to leave valuable and much needed offshore domestic oil and gas deposits off limits to responsible exploration and production, including right here in Virginia. Unleashing these resources would lower the cost of energy for everyone, and create good jobs in the process.

McDonnell also pointed to pending legislation in the U.S. House of Representatives, the “American Energy Initiative” (HR 3408), which aims to “expand access to American energy resources.” (A search of THOMAS, however, turns up no bill called the “American Energy Initiative.” HR 3408 is titled the “PIONEERS Act,” short for “Protecting Investment in Oil Shale the Next Generation of Environmental, Energy, and Resource Security Act.” It was passed on February 16 by a vote of 237-187 in the House of Representatives.)

McDonnell’s statement brought to mind (my mind, at least) an interview I conducted last year with Alan Pisarski, a transportation expert and author of the “Commuting in America” series for the National Academy of Sciences.

Pisarski contended then that rising gasoline prices do not have a significant effect on Americans’ behavior. Here’s an excerpt of our conversation:

While four dollars a gallon “sounds scary,” Pisarski explained, that “is actually about the same as we were paying in 1980 — even less if you take into [account] things like wealth and fuel efficiency.”

Even if gas prices move higher than that, “the benefits that people gain from the automobile are not really going to change,” he said. People will make minor accommodations to account for the higher prices, “but the fundamental change in the society will be trivial.”

As an example, Pisarski pointed out that the “last time we almost doubled the price of gasoline, in 2009, we had a three-and-a-half percent decline in travel.”

Pisarski also noted some interesting statistics regarding Virginia’s idiosyncratic commuting patterns that may be relevant to the Commonwealth’s own energy and transportation policies.

Update, February 22: Governor McDonnell’s office has reached out to Bearing Drift with clarification regarding the federal energy legislation referenced above. A bill called the “American Energy & Infrastructure Jobs Act” was rolled into HR 3408, the PIONEERS Act, and it was this piece of legislation that Governor McDonnell had supported, particularly because of its impact on jobs and energy resource development in Virginia. He had addressed this specifically in a news release dated February 17.

  • http://www.taxpolitics.com Alan Dlugash

    Have you seen this ridiculous proposal out of Ron Klain over at Bloomberg opinion? He suggests a “pocketbook protection” plan when gas prices rise over $4.00/gallon — in effect, a payroll tax cut paid for by a corporate surcharge.
    http://www.taxpolitics.com/2012/02/welfare-for-drivers-a-modest-proposal/

  • Scott S

    The White house is taking action:

    Obama Administration Wants To Raise Oil Royalties By 50%

    http://gas2.org/2012/02/21/obama-administration-wants-to-raise-oil-royalties-by-50

  • ToR

    In no way have President Obama’s policies impacted the price of oil or gas in the US. We will never produce enough oil to meet our demand and therefore the price of oil is set on the world market, something the president clearly doesn’t have any control over.

    It is a joke to think any increase in drilling or lowering of taxes, or increasing royalties or lease rates will lower the price of gas.

    Additionally, we should set up a system like they have in Alaska. The petroleum (and other mineral) wealth of the Commonwealth should be paid to its true owners, the residents of Virginia.