George Rebane

The Chief Organizer claims he doesn’t know what’s made gasoline prices go through the roof, and he suspects that it’s all those “traders and speculators”.  So he has launched another investigation to ferret out these low lifes.  Predictably, it will turn up nothing in that quarter, and only repeat the performance of Clinton and Bush2 when they tried that diversionary bamboozle during high oil prices.

The real reason for the soaring price of gasoline is the plunging value of the dollar aided by our Federal Reserve’s ‘quantitative easing’ and low interest rate policy, and the fact that our politicians are evincing no clue as to how our debt and deficits will be managed.  S&P’s downgrade of our debt repayment outlook from ‘stable’ to ‘negative’ put a ribbon on it this week.

But in the end Mr President, just have your mentors take a look at the US Dollar Index measured against a basket of the world’s leading currencies (more here)  It is down almost 10% from a year ago, thereby making everything we buy from overseas more expensive.  Pay attention Buttercup, we buy oil from overseas – more because of your domestic energy policies – and that dollar devaluation has itself contributed about a 40 cent increase to the price of a gallon of gas since last spring.  So cut the investigation smoke screen, we are not as dumb as you hope.

If you want to help, get serious about cutting government spending instead of putzing around with economy stifling tax increases.  Our only road out of this mess is growth.