Wednesday, May 28, 2008

More Truth Than You Can Handle

In case you haven't yet had enough of pundits wishing that politicians would tell the truth as they see it, Thomas Friedman offers us some more truthiness. Friedman opens:
Imagine for a minute, just a minute, that someone running for president was able to actually tell the truth, the real truth, to the American people about what would be the best — I mean really the best — energy policy for the long-term economic health and security of our country. I realize this is a fantasy, but play along with me for a minute. What would this mythical, totally imaginary, truth-telling candidate say?
At this point you're probably already thinking, "I don't know, but I suspect it's something different than what you're about to say." Perhaps you're expecting that it will be yet another call by Friedman for an increased gas tax.
No, our mythical candidate would say the long-term answer is to go exactly the other way: guarantee people a high price of gasoline — forever.

This candidate would note that $4-a-gallon gasoline is really starting to impact driving behavior and buying behavior in way that $3-a-gallon gas did not. The first time we got such a strong price signal, after the 1973 oil shock, we responded as a country by demanding and producing more fuel-efficient cars. But as soon as oil prices started falling in the late 1980s and early 1990s, we let Detroit get us readdicted to gas guzzlers, and the price steadily crept back up to where it is today.

We must not make that mistake again. Therefore, what our mythical candidate would be proposing, argues the energy economist Philip Verleger Jr., is a “price floor” for gasoline: $4 a gallon for regular unleaded, which is still half the going rate in Europe today.
Price controls? Friedman is literally suggesting that having "had the courage to tell voters that the McCain-Clinton summer gas-giveaway plan was a fraud", Barack Obama should guarantee windfall oil company profits by preventing the free market from ever leading to a gas price below $4/gallon?
Wouldn’t it be amazing if he took the next step and put the right plan before the American people? Wouldn’t that just be amazing?
It sure would, Mr. Friedman, but (so sorry) your plan isn't the right one.

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