Federal government policies are partially responsible for the pain that Americans are feeling at the gas pump. The president, congress and the Federal Reserve could help bring down gas prices by taking the following actions:
- Change direction on protectionist policies that make it difficult or impossible to develop oil reserves in North America. We should develop extensive oil reserves in Alaska, including the Alaska National Wildlife Reserve. We should actively work with Canada to utilize oil sands. America has stood by, due to objections from environmental groups, while China is moving aggressively to lock up oil sand production in Canada. There is no other country in the world that does not develop its own oil and gas reserves. Current energy policy in this country is not only contributing to higher gasoline prices but is also compromising national security by forcing an increasing reliance on imported oil from countries unfriendly to the United States.
- The Federal Reserve should stop printing money. “Quantitative easing” policies are driving down the value of the U.S. dollar, which drives up the price of oil as oil is priced in dollars.
Critics of developing additional oil reserves in North America claim that drilling for more oil will not bring down prices in the short run because it takes too long to bring production online. They said the same thing 10 years ago. If we had developed ANWR at that time, that oil would be now be flowing to market.
The increase in world oil prices has been partially driven up by speculation that oil supplies will be tight due to increased demand from developing nations and unrest in the Middle East. A change in policy direction that we are committed to increasing the production of oil would send a signal to markets that would serve to dampen speculation and bring down prices. When politicians tell you they can do nothing about high gas prices, don’t believe them.