The Boston Herald Asks: “Where The Hell Did Barack Obama Learn Economics?”

He didn’t.  That’s one of his fundamental problems. 

In a letter sent to congressional leaders Tuesday Obama put part of the blame for the sharp spike in gas prices on “increased global demand” compounded by “unrest and supply disruptions in the Middle East.” Well, China’s demand didn’t spike overnight and any disruptions from the serial crises in the Middle East have far more impact in Europe than here.

So the president notes — again — that “there is no silver bullet.” However, when in doubt blame Big Oil and propose to “eliminate unwarranted tax breaks to the oil and gas industry,” which he insisted were “wasteful subsidies.” Now if you take away $4 billion in tax breaks from the oil industry, what do you suppose that will do to the price of gasoline? Make it go up or down?

As a general matter, I don’t favor subsidies of any industry.  Let ’em compete on a level playing field, and we’ll all be better off.  So if Obama wants to get rid of “wasteful subsidies,” I’m in (although somehow I don’t think Obama would want to get rid of wasteful subsidies for solar, wind, rail, etc.). 

But set that aside.  How, exactly, does Obama think that extracting another $4 Billion in taxes from the oil and gas industry will lower the cost of gas?  There really are only two possible answers.  1) He’s an idiot.  2) He’s just demagoguing the issue; he wants to increase the price of gas (through higher taxation) while pretending to care that gas prices are high.

My money’s on a little of both.  Obama has shown pretty clearly that he has no understanding of economics.  And he has actually said that he wants gas prices to go up.  He’s perfectly willing to sacrifice the economy on the altar of global warming.

Published in: on April 28, 2011 at 11:59 am  Leave a Comment  

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