The politics of inflation: high gasoline prices | Opinion
The Republican Party has a long tradition of politics for non-political issues. Gun safety is a social issue that we all agreed on at one time. Racism is a moral issue. Abortion is a medical problem, but perhaps also a religious one. Gender identity is a psychological issue.
Now Republicans want to make global inflation, especially inflated gas prices in the United States, a political issue in the next election. So what makes gasoline price inflation outpace most other price inflation?
This is not the natural cause of inflation in a capitalist society: the failure of capitalism to create an adequate supply of petroleum and petroleum by-products. We have lost about 1 million barrels of oil a day since we banned Russian oil. Biden filled that gap with one million barrels a day for six months from national reserves.
I have never driven to an empty gas pump in the past year or had to wait in a mile long queue like I had to in the 1970s. Haven’t seen long lines for gas anywhere else in the US either. I had no problem getting fuel oil last winter.
The problem is the result of the greed of the oil companies and the effervescence of the investment funds, in particular the hedge funds. They drive up prices by speculating on oil futures while Americans expect, encouraged by the media, continued inflation.
Today, the corporate political party, the Republican Party, is making this failure of capitalism a political issue, blaming President Biden. This appeals to businesses because they see Biden as a terrible threat. Biden wants to transition the country from fossil fuels to renewable energy, and the number of progressive Democrats in Congress cheering him on is growing.
Oil companies therefore see rising gas prices as a double win: (1) more than enough profits to offset losses in 2020-21, and (2) the potential downfall of Biden and progressive Democrats investing in renewable energies.
This means that gas prices are unlikely to fall until mid-November 2022. Depending on the outcome of these elections, high gas prices could continue into 2024. What do oil companies have to lose? ?
The oil industry and the investment companies that support them get another benefit from inflation. For decades they were content with a political semi-oligarchy resulting from only two easily controllable parties vying for the political center and an army of lobbyists in Washington. Trump now offers a path to autocracy, the form of governance that prevails in all free market enterprises.
The CEO is autocratic in all businesses. He can listen to advisors as much or as little as he wants, but he makes all major and even minor decisions based on his leadership style. All CEOs and corporate presidents are more familiar with autocratic organization. One party is even easier to control than two.
Republicans are blaming Biden and Democrats for the trillion-dollar stimulus package that has kept hundreds of thousands of small businesses alive and millions of families out of bankruptcy. Well, there have been two trillion-dollar stimulus packages: one under Trump and one under Biden. Does this mean that the blame is shared?
If the electorate can ignore the simple confusion of blaming President Biden for global inflation and elect more Democratic progressives to Congress, it will eliminate the filibuster in the Senate, the current cause of the impasse.
This will save this country in the short term. In the long term, we will only be saved by the Republican Party coming to its senses and more political parties representing a wider range of opinions.
In the meantime, only one party holds the pillars of democracy upright: the Democratic Party.
Robert Beard is Professor Emeritus, Linguistics and Russian Studies Programs at Bucknell University.