To hear President Joe Biden tell it, high gasoline prices aren’t his fault. Those looking for someone to blame should direct their anger instead at what he describes as “the companies running gas stations.”
In a much-ridiculed tweet, the nation’s commander in chief ordered those unnamed companies to cut the price of gasoline at the pump “to reflect the cost you’re paying for the product. And do it now.”
This was not the first time Biden tried to blame others for gasoline prices that hit record highs last month and threaten to hurt his fellow Democrats in the upcoming midterm elections. At various points, Biden has called out ex-President Donald Trump and his MAGA sycophants, multinational oil companies, the COVID-19 pandemic and Russia’s war on Ukraine.
His latest scapegoat is an even odder target, considering that roughly 95% of America’s 145,000 service stations are owned not by major fuel refiners but by independent retailers licensed to sell certain brands of gas.
Many are mom-and-pop convenience stores that make their money off lottery tickets, soda and chips, barely breaking even on gasoline. The evidence of a conspiracy to keep prices high or otherwise cheat the public is pretty much nil, as most consumers know instinctively: If any given station tries to sell gas for more than competing stations, customers seek out the relative bargains — even if it means burning fuel to find them.
Just in time to highlight the emptiness of Biden’s accusation, gasoline prices have started coming down, and they’re tipped to fall sharply in the weeks ahead. The real factors behind this year’s sticker shock at the pump continue to be the cost of crude oil, limited refinery capacity, distribution constraints and geopolitical turmoil. Demand for fuel now is moderating as motorists respond to high prices by driving less.
The administration’s belligerence on gas prices overlooks the realities of this global marketplace. No wonder billionaire Jeff Bezos criticized the president’s tweet as “straight-ahead misdirection, or a deep misunderstanding of basic market dynamics.”
Bezos is right: Gas prices are responding to supply and demand, as they should in a free market. Gas-tax holiday gimmicks, releases from strategic petroleum reserves and the incessant finger-pointing do nothing to change the economic reality. They’re not helping Biden’s approval ratings, nor shoring up consumer confidence.
Meantime, Biden needs to get ready for the next economic phenomenon that he’ll also probably want to blame on someone else.
Minutes from the U.S. Federal Reserve’s June 14 and 15 meeting published on Wednesday show policymakers anxious over inflation and hawkish about cracking down on prices. It’s clear from the minutes, and consistent with previous statements from Fed Chair Jerome Powell, that the central bank is willing to accept slower economic growth, up to and including a recession, to get inflation under control. That likely means additional aggressive interest rate hikes, which could shrink the economy just as voters go to the polls in November.
Confronted with a Supreme Court he can’t control, gun violence he can’t control, climate change he can’t control and economic threats he can’t control, Biden has taken some defensive steps. Those include executive action on guns, climate change and voting rights, as well as protecting access to abortion pills and shielding those who cross state lines for abortions. He recently called for filibuster carve-outs in the Senate.
Those steps are significant but insufficient. Biden’s fellow Democrats want him to fight, fight, fight. The danger is that Biden, more of a Beltway insider than a natural street fighter, picks the wrong fights, as he did when he blasted the regular folks running local gas stations.
Instead of taking potshots, the president needs to admit that his administration has little influence over the historic spike in inflation, including gas prices, or the overall direction of the economy as the Fed takes aggressive action. Leadership requires balancing a vision of where the nation needs to go with a recognition of what can be realistically accomplished.