Politico, fact-checking a claim made by Lousiana Governor Bobby Jindal that gasoline prices under the current administration are higher than they’ve ever been, contradicts Governor Jindal:

Louisiana Gov. Bobby Jindal on Wednesday ripped President Barack Obama over rising gas prices and said any of the Republican 2012 candidates will do “so much better” if elected to the White House. “The reality is, gasoline prices have doubled under this president, highest prices for oil and gasoline in a 150 years. People used to think it was because of incompetence from Obama administration on energy – I think it’s because of ideology. They’re pursuing a radical environmental ideology,” Jindal said on “Fox & Friends.” In fact, the monthly average retail price of gasoline peaked at $4.26 a gallon in inflation-adjusted dollars less than four years ago, in June 2008. It then plummeted to $1.80 a gallon in the next six months during the global financial collapse. Oil isn’t near historic highs either. Jindal scorches Obama on gas prices xxx Bobby Jindal scorches Obama on gas prices – MJ Lee – POLITICO.com

AmericaBlog, going further, finds that gasoline peak prices under President George W. Bush (the 43rd President, 2001 – 2008) tied the peak price under President Jimmy Carter (1977 – 1980), whose administration included the Iranian hostage situation and an OPEC-sponsored petroleum shortage. And more: here’s an infographic noting major events and gasoline prices:

Perhaps the most disturbing aspect of the original claim, implying that the Obama Administration’s policies caused high gasoline prices, is its oversimplification. Higher prices matter less – or not at all – if we’re using more efficient devices. A clear example might be traffic lights. Assume for simplicity’s sake that our only use of electricity is for traffic lights: when incandescent bulbs are replaced by LEDs, the energy savings are reported to be in the range of 90%. Once that shift has been made, it would take an increase in cost of 1,000% (that is, a ten-fold increase) in the cost of electricity in order to bring the cost to its original cost – not counting the savings in the labor cost of regularly changing the bulbs. Further, as every traffic light system makes the change, aggregate demand will drop, driving prices down, rather than up.

Similar dynamics – with good and bad outcomes – operate with respect to gasoline and other petroleum products:

When an economy declines (painful for most), economic activity – and gasoline consumption – decline, which tends to cause gasoline prices to go down;

when prices go up, or regulatory rules require it, we use less gasoline, by making and buying more efficient vehicles, using them more efficiently, or by using them less often; an extreme example would be the United States during WW II, during which the civilian economy had gasoline rationing, use of mass transit and other conservation measures were seen as patriotic actions, resulting, according to the British historian Richard Overy, in a reduction in civilian gasoline use of over 90% during the war years (Richard Overy, Why The Allies Won, citation and page reference to be supplied in an update of this post).

Governor Jindal is thus wrong twice:

First, on the basic facts – the claim that gasoline prices have peaked under President Obama; That oil prices are something over which a president can exert control, particularly in the face of a hostile Congress; That high gasoline prices can be looked at in isolation: if we had full employment, more energy-efficiency in the use of gasoline, we’d probably be pretty content as a nation; in fact, it’s not the price per gallon that matters. It’s the price per mile. we recently wrote about hybrid electric Lincoln Town Cars. If your Lincoln Town Car doubles in efficiency, operating costs for fuel go down unless the price of gasoline doubles to follow it, even if the mileage is the same.

We’re surprised that Governor Jindal, from a state with a lot of petroleum production and refining capacity, would oversimplify this issue; and we hope this isn’t a case of partisanship over accuracy.

See also:

Ford selling Lincoln hybrids