The Campaign Spot

Adjusted for Inflation, Gas Prices Look Even Worse

The front page of today’s Washington Post declares in the lower right-hand corner: “On gas prices, voters blame Obama; experts disagree.”

Strangely, I don’t remember a variation of that headline in 2008 when George W. Bush was president.

But look beyond that, to the chart inside, which compares the average price of a gallon of gasoline over the past 90 years.

While the peak in the summer of 2008 was $4.27, the March 12 average of $3.83 surpasses everything else before it – from the beginning of the chart in 1920 (when only a small fraction of Americans owned cars!) and through the Great Depression and through the 1973 oil crisis and through the late 1970s and 1980s, the Persian Gulf War, and after 9/11. Note that every other spike in prices tends to coincide with economic hard times.

In other words, adjusted for inflation, today’s gas prices – in March! — are worse than during every preceding gas price spike, except the peak of summer in 2008. So what will the peak price be this summer?

In March 2008, the national average was $3.20 per gallon. By June it was $4.08.

The usually great Phil Klein says, “gas prices are highly volatile and it’s often hard to differentiate short-term fluctuations from long-term trends.” True enough, but there are a couple of factors driving up the price that aren’t likely to be alleviated between now and November: global demand, tensions with Iran, a weak dollar, industry fears that the administration is eager to impose new costs upon them, regulatory obstacles to expanding refinery capacity, etc. Then throw in the traditional increase in demand as summer approaches (which will slide as autumn arrives), and we’ll be enduring, at the very least, a long hot summer of high gas prices, even if autumn isn’t quite so bad.

And if we see a repeat of 2008′s scenario – a big run-up alleviated only by an economic collapse – well, President Obama will be toast under that scenario, too.


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