Two different approaches, two different results.
/On his first day in office, Biden declared war on fossil fuels by canceling the XL Pipeline and suspending oil leases. By coincidence, I filled my gas tank that day — January 20, 2021— in New Hampshire and paid $1.69 per gallon. I filled that same tank at the same gas station yesterday and paid $3.49 per gallon. Joe, I bought gasoline during the Reagan administration; I knew gas prices during the Reagan administration; I liked gas prices under the Reagan administration. Joe, yours is no Reagan administration.
Steven Hayward:
With reports that Joe Biden is once again considering taking oil from the Strategic Petroleum Reserve because of the national crisis of his flailing re-election campaign (and with oil prices today yo-yoing considerably), our pals at the Committee to Unleash Prosperity remind us of the long-term effect of markets and liberated production, as we saw after Reagan decontrolled the price of oil on his first day in office in 1981:
Hayward: Worth recalling how the left howled at this step, predicting doom. Here’s my account of it from chapter 2 of The Age of Reagan:
The conventional wisdom was that oil prices would surely head higher as a result of Reagan’s move. Democrats and liberal interest groups seemed to compete with each other for the most fulsome expression of economic illiteracy. In the annals of public policy prognostication it is difficult to find such a wide assembly of wrongheadedness. Sen. Howard Metzenbaum of Ohio said took to the Senate floor the next day to predict that “we will see $1.50 gas this spring, and maybe before. And it is just a matter of time until the oil companies and their associates, the OPEC nations, will be driving gasoline pump prices up to $2 a gallon.” Sen. Don Riegle of Michigan said that “It will hurt our people within a matter of days.” Sen. Dale Bumpers of Arkansas had previously predicted that “without rationing, gasoline will soon go to $3 a gallon,” and now added that “Decontrol is designed to see how much we can squeeze out of the American people before they take to the streets.” Maine’s Sen. George Mitchell said “Every citizen and every family will find their living standards reduced by this decision.” Democratic Congressman Ed Markey said “I believe that decontrol as a cure will prove to be worse than the disease of oil addiction.” A Naderite advocacy group predicted that oil prices might go as high as $870 a barrel “under assumptions which many experts believe are realistic.” Instead oil prices started falling almost immediately; from an average high of $1.41 in February 1981, pump prices fell steadily to a national average of 89 cents a gallon in the spring of 1986. Oil imports from OPEC fell by 2 million barrels a day by the end of 1982. Reagan’s integrated view of oil prices, inflation, and the value of the dollar is especially remarkable in comparison with the Carter administration, which never seemed to understand inflation, ascribing it to animal spirits or, at one point, even to the moral failings of Americans.
