A Short History of the Price of Gas and US Energy Policy
Questioning a constitutional duty, characteristics of these policies and energy independence v. energy security
We are currently experiencing the highest average price for gas in our nation’s history, and now seemed a good time to reflect on our energy policies, some characteristics of those policies, gas prices and how we arrived where we are, today.
Is there a Constitutional duty for a President to have an Energy Policy?
As an Article II power and responsibility, the President has a legal obligation to execute the laws. But without legislation or a mandate to enforce, as the elected Commander in Chief, is there an ethical duty to produce an energy policy for the President’s “sphere”1 of responsibility, as the U.S. Supreme Court has interpreted it? Article II responsibility includes ensuring national security 2 and in that “sphere” energy security must inevitably be a part of it.
To the extent that developing an energy policy is an ethical duty, the “do no harm” principle has been suggested as a starting point for a national energy policy.3 Pres. Carter referred to the effort to win the energy battle as the “moral equivalent of war”.4
Before we look more closely at each President’s energy policy, putting it in context with the history of gas prices can help explain some of policies. Here is a very short history for context.
A modern history of gas prices
Gas prices certainly should be related to an energy policy and possibly Presidential approval ratings, but at least one study on that topic shows that gas prices at the pump only has an effect on approval ratings when prices are high. When prices are low, there is no significant effect. Gas prices, when they were high, correlate at -0.52 with Presidential approval rating from 1977 to 2011,5 meaning a high gas price can predict a low Presidential approval rating. But in the last decade, there has been no correlation, or negative impact to the President’s approval rating when prices were high.6 Still, simple measures like the price of gas at the pump is much more easily understood by the citizenry than complex international trade policies.7 However, in the case of Pres. Biden, his approval rating has been shown to correlate with gas prices when high, but there are other possible factors not explained by this correlation (inflation, war, etc.) that could also be affecting approval rating, but here is one analysis (see graph).8
The price of gasoline per gallon was first documented by the federal bureau of labor statistics in Jan 1978, Eight months after Pres Carter announced his energy policy, and gasoline was $0.63/gallon. Through the George W. Bush Administration, it never rose above $1.8/gallon. However, gasoline broke a $2.00/gallon barrier in April 2005 and then broke the $3/gallon barrier in May 2007. The $4/gallon barrier was broken in April 2008 with $4.10/gallon, an all time high.9 June 13, 2022, gas prices passed the $5/gal price for the first time in the U.S..10 Here is a graph of the historic average price of gas since 1995s, which shows we are currently in unprecedented high gas price territory:11
All the Presidents’ Energy Policies
Presidents Kennedy and Johnson had no energy policy; indeed the first modern presidency to introduce a national energy policy was President Nixon’s Administration. He announced his policy of reducing oil imports with Project Independence, which aimed to “make the US energy independent by 1980”12. Oil imports more than doubled in the years that followed and President Nixon (for other historical reasons) had the lowest popularity rating since President Truman.13
On May 27, 1975, President Ford introduced his energy policy for oil independence by 1985 in a television address to the American public.14 The focus of his Energy Policy was primarily production, but he also introduced a Synfuels initiative. President Ford signed legislation Dec. 22, 1975, which created the Strategic Petroleum Reserve. His popularity fell from a high of 52 percent to 48 percent over the ensuing year, and he lost his Presidential re-election bid.
President Carter announced his goal of establishing a Department of Energy in February 1977. Then he introduced his new energy policy to the American people through a television speech in April 1977, 15 which likely contributed to his drop in popularity from 58 percent at the time of his speech to 39 percent over the course of a year. President Carter may well be remembered most vividly for his sweater and chat by the fireplace as he announced to the American people that he wanted to have an “unpleasant” conversation about energy -- resulting in a blow to his popularity. The focus of his Energy Policy was one almost exclusively on conservation. He lost his re-election bid.
On July 17, 1981, President Reagan transmitted his National Energy Policy to Congress;16 at the time his approval rating was 60 percent and over the next year fell to 43 percent. His Energy Policy was focused on production with confidence in the "native American genius, not arbitrary federal policy, to be free to provide for our energy future." President Reagan’s popularity began to move upward in 1984, and he easily won re-election, beating Walter Mondale by a 59% to 41% margin.17
President George H.W. Bush’s Administration announced the first national energy policy to be developed in eight years on Feb 20, 1991 in a news release by the Department of Energy. His Energy Policy focused on energy-efficiency and secondarily, production. His popularity fell in a steady decline from an all-time high of 89 percent to a meager 44 percent a year later. He lost his re-election bid for a second term to Governor Bill Clinton.
The William J. Clinton Administration, over the course of its two terms, was primarily criticized for having no energy policy at all. At the end of President Clinton’s second term, his administration continued to announce that the failed energy policy was due to Congress’ failure to pass his administration’s legislative proposals. 18 Despite this, Pres. Clinton had consistently high approval ratings during his two terms – higher than any other presidency second only to President Ronald Reagan.19 In June 2000, only 7% of the public blamed Clinton for rising gasoline prices.20 In October 2000, in the closest move to indicate an energy policy, Clinton announced his decision to release 30 million barrels of crude oil from the Strategic Petroleum Reserve. Clinton’s approval rating right after his decision found that 58% of Americans favored this action, while 36% opposed it.21 He won his re-election campaign against Sen. Bob Dole.
As one of the first acts of his administration, President George W. Bush made Vice President Richard Cheney the leader of his national energy policy development process with an Executive Order on January 29, 2001. In May of the same year, President Bush announced a national energy strategy.22 One part of it included a proposal for transitioning to a hydrogen economy to reduce our dependence on foreign oil.23 The intervening events of 9/11 and his response to them probably were responsible for a rise in President Bush’s popularity rating from 63 percent in May 17, 2001 to 76 percent in May of 2002. President Bush ‘43, left office with gas prices almost $4/gallon — double from the previous year, creating a situation that the Republican Presidential nominees had to carry during the 2008 Presidential election. In fact, a Quinnipiac University poll released on Thursday, Aug 3, 2008, showed that gasoline prices were the main election issue.24
President Obama was elected in 2008, but did not announce an energy policy until February 2012, in his fourth year of his first term. However, Pres. Obama made an announcement in 2010 that he would be focusing on an energy policy in 2011,25 and released the “Blueprint for a Secure Energy Future.”26 Then in 2011, President Obama said, “Our energy policy still is just a hodgepodge, and for all the progress we’ve made, we’re not where we need to be in making sure that this is an energy-efficient economy that is running on all cylinders.” 27
In February 2012, “. . . the Department of the Interior issued permits that will expand our exploration in the Arctic," Robert Gibbs, Press Secretary for the US DOI said, "Our domestic oil production is at an eight-year high, and our use of foreign oil is at a 16-year low. So we're making progress." But gases prices were up 93% from the time that Obama took office, at this point.28 On April 11, 2012 President Obama had a 48% approval rating.29
Pres. Obama’s, Vice President Joe Biden called the Administration’s Energy Policy “The Best It’s Ever Been,” in this 2012 interview, and it was featured in the Mitt Romney campaign for President.30
QUESTION: “Gas prices are above four dollars a gallon – you were asked this question, and you gave an answer – but there’s a new commercial out that says since Obama has become president, prices have nearly doubled. Four years in, should you all have a better energy policy in America?”
BIDEN: “I think our energy policy is the best it’s ever been.”31
Pres. Obama went on to win a second term.
The Donald J. Trump Administration had an Energy Policy with a focus on energy independence primarily by increasing domestic production and ending imports of foreign oil,32 supporting LNG infrastructure and supporting nuclear energy.33
Pres. Biden made a campaign promise to “end fossil fuels”34 and promised to shut down the Keystone Pipeline which he did on his first day in office.35 He has also committed to major investments in clean energy, in particular solar and wind energy.36
Historically, there are four types of focus in an Energy Policy
Four types of focus in these national energy policies emerge: (1) production; (2) energy-efficiency; (3) conservation; and (4) alternatives. The selection of “conservation” by President Carter has never been repeated by a subsequent President until Pres. Biden’s energy policy which arguably compels conservation because of the reduction in domestic production and rising prices. While Americans have grown more likely since 2007 to value U.S. production of fossil fuels as a national priority, they nevertheless see developing alternative energy sources as important. This is according to a new question included on the 2011 Environment poll that found 66% of Americans choose "development of alternative energy such as wind and solar power" as the preferred approach for addressing energy concerns, while 26% choose "production of more oil, gas, and coal supplies."37 Production, then as a focus of an energy policy has been consistently seen favorably whenever it was the focus of an energy policy. Conservation has not been seen positively when it was the focus of an energy policy, as in the Carter Administration energy policy and as it appears with the approval rating of the Biden Administration correlated with gas prices. Alternatives are seen favorably.
Energy Independence v. Energy Security
Energy policies almost always include a reference to energy independence or energy security. Jeff Stahler makes that point very well in his political cartoon, here. There is a distinction between energy security and energy independence, and although energy independence may be a popular goal, it may decrease security, rather than increase it. Even defining what is energy independence and how to measure it is not clear. For example the Trump Administration, claimed energy independence had been achieved based on one measure, and opponents claimed it was not achieved based on another measure. Both measures were factually correct.38 It is also important to note that energy independence does not equate to energy security. For example, oil supplies from the Middle East and from Venezuela are important because our role in the supply chain as a customer is relied upon by these countries, thus providing some leverage for the U.S.. Another example is the embargo in Iran prevented U.S. firms from doing business with Iran (and buying oil from Iran), providing a window of opportunity for China to begin establishing long term investments in Iran while forging alliances driven by the need for China to secure its investments. By stopping our trade with Iran, we lost control of any part of its economy and lost our leverage. The same could be said for stopping our customer relationship with Venezuela and the Middle East, where our advantages of these geopolitical alliances far outweigh the disadvantages of purchasing a commodity we can use. So what we really need is to be in a position to have “energy security” in that we continue to be a customer in the global supply chain, with buying power leverage; and also have “energy independence” where we have enough domestic production to supply our energy needs, thereby eliminating any leverage from any region of the world.
Conclusion
So it is imperative that a President exercise their constitutional duty to have an energy policy that includes production, energy-efficiency, conservation and alternatives, and to first “do no harm” with it, as a first principle. The short history of energy policy and gas prices show that although Presidential approval does not benefit perceptibly by effective policies it is effected negatively if gas prices are high. Finally, energy security and energy independence will remain elusive goals without better definitions for what this means to the American public.
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Through my time as a scientist at the U.S. EPA, and the White House Science Office and as a Chief Counsel at the U.S. Department of Transportation, serving two Presidents and serving as an advisor on the Dole and later, Romney campaigns; I had the opportunity to observe the making of national energy policy by the Executive Branch. During my service as Chief Counsel, I chaired the interagency legal committee that developed the Regulatory Framework for a Hydrogen Economy.
McCulloch v. Maryland, 17 U.S. 316 (1819).
U.S. Const., Art. II.
Jonathan Elkind, “Energy Security: Call for a Broader Agenda,” Chap. 6, eds. Carlos Pascual and Jonathan Elkind, “Energy Security: Economics, Politics, Strategies, and Implications,” pp. 119-148.
President Jimmy Carter, “Address to the Nation on Energy,” April 18, 1977 at https://millercenter.org/the-presidency/presidential-speeches/april-18-1977-address-nation-energy.
http://www.centerforpolitics.org/crystalball/articles/ITW2011042801/ and the updated article https://centerforpolitics.org/crystalball/articles/gas-prices-and-presidential-approval/
http://www.centerforpolitics.org/crystalball/articles/ITW2011042801/ and the updated article https://centerforpolitics.org/crystalball/articles/gas-prices-and-presidential-approval/
Samuel Kernell, “Explaining Presidential Popularity. How Ad Hoc Theorizing, Misplaced Emphasis, and Insufficient Care in Measuring One’s Variables Refuted Common Sense and Led Convetnional wisdom Down the Path of Anolmalies,” The American Political Science Review, Vol. 72, No. 2, pp. 506-522 at 515 (June 1978). For example, “ . . . increasingly expensive gasoline can be more easily discerned and evaluated than can a presidential decision to veto a price ceiling on the production of ‘old’ domestic crude oil.”
https://www.dataforprogress.org/blog/2021/11/17/do-voters-disapprove-of-biden-or-rising-gas-prices .
http://data.bls.gov/pdq/SurveyOutputServlet (this data has been removed from the BLS webpage).
https://www.statista.com/chart/24450/average-weekly-price-of-gasoline/
https://www.statista.com/chart/24450/average-weekly-price-of-gasoline/
Mark P. Mills, Energy Intelligence: The Efficacy Of Presidential Energy Policy, Forbes.com (April 7, 2009) available at https://www.forbes.com/2009/04/07/roosevelt-reagan-bush-clayton-christensen-energy-policy.html#2e0ab12b6274 (last visited Oct 12, 2020).
USA Today, “Presidential Approval Tracker,” http://www.usatoday.com/news/washington/presidential-approval-tracker.htm (visited Jan 24, 2010). Now at https://flowingdata.com/2009/08/05/track-presidential-approval-ratings-and-compare-to-past/ (visited July 9, 2022) unfortunately, the site has not kept up this great comparative chart for Presidential approval.
Gerald Ford, Speech, May 27, 1975 available at https://millercenter.org/the-presidency/presidential-speeches/may-27-1975-address-energy-policy .
Jimmy Carter, The President's Proposed Energy Policy, 43 Vital Speeches of the Day 418-420 (May 1, 1977). Jimmy Carter, "The President's Proposed Energy Policy." 18 April 1977. Vital Speeches of the Day, Vol. XXXXIII, No. 14, May 1, 1977, pp. 418-420. Also see
President’s Message to Congress Transmitting The National Energy and Policy Plan (July 17, 1981), Public Papers of the President: Ronal Reagan, 1981-1989, available at http://www.reagan.utexas.edu/archives/speeches/1981/71781b.htm (last visited Jan. 5, 2011).
Alan S. Miller, Energy Policy From Nixon to Clinton: From Grand Provider to Market Facilitator, 25 Envtl. L. 715 (1995).
USA Today, “Presidential Approval Tracker,” http://www.usatoday.com/news/washington/presidential-approval-tracker.htm (visited Jan 24, 2010). Now at https://flowingdata.com/2009/08/05/track-presidential-approval-ratings-and-compare-to-past/ (visited July 9, 2022) unfortunately, the site has not kept up this great comparative chart for Presidential approval.
Americans Blame Oil Companies and Oil-Producing Nations for Price Rise
While both parties try to gain politically by blaming the other for the increase in gas prices, most Americans are looking outside of Washington for the culprits. The polls show that 35% of Americans think oil companies are at least somewhat to blame, while an additional 30% think oil-producing nations are responsible. Only 18% think that either the federal government (11%) or the Clinton administration in particular (7%) is to blame for the higher gas prices. There are few partisan differences on these views. Fully one in five Americans (20%) express no opinion on the matter. (June 29, 2000) http://www.gallup.com/poll/2764/Americans-More-Optimistic-High-Gas-Prices-Will-Decline.aspx.
A Gallup poll conducted Oct. 6-9, 2000, finds that 58% of Americans favor the president's decision, while 36% oppose it. http://www.gallup.com/poll/2449/American-Public-Supports-Decision-Tap-Oil-Reserves.aspx .
See Center for Media and Democracy, Cheney Energy Task Force, SourceWatch, Oct. 27, 2008, available at http://www.sourcewatch.org/index.php?title=Cheney_Energy_Task_Force (last visited Dec. 19, 2010).
https://georgewbush-whitehouse.archives.gov/news/releases/2003/06/20030625-6.html#:~:text=President%20Bush's%20%241.2%20billion%20hydrogen,no%20pollution%20or%20greenhouse%20gases.
USA Today wrote, “President Obama said one of his top priorities next year is to push for an energy policy, though he did not give specifics for what the legislation would include.”
https://e360.yale.edu/features/energy_deja_vu_obama_must_break_with_failed_us_policies
President Obama, Remarks to the DNC, Miami, FL, June 13, 2011, http://www.whitehouse.gov/the-press-office/2011/06/13/remarks-president-dnc-event-0 (visited July 9, 2022).
https://www.investors.com/politics/editorials/obama-shifting-talk-on-high-gas-prices/ (Feb 2012).
Sorry but the campaign website is no longer available but used to be at http://www.mittromney.com/news/press/2012/04/president-obamas-energy-policies-failing-pennsylvania-2009 .
https://www.washingtonpost.com/blogs/the-insiders/post/obamas-failed-energy-policies/2012/03/01/gIQA3bc4kR_blog.html (visited July 9, 2022).
https://trumpwhitehouse.archives.gov/issues/energy-environment/
https://trumpwhitehouse.archives.gov/issues/energy-environment/
https://apnews.com/article/9dfb1e4c381043bab6fd0fa6dece3974
https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/20/executive-order-protecting-public-health-and-environment-and-restoring-science-to-tackle-climate-crisis/
https://www.whitehouse.gov/briefing-room/statements-releases/2022/06/06/fact-sheet-president-biden-takes-bold-executive-action-to-spur-domestic-clean-energy-manufacturing/
Energy independence has been stated differentlly. Politifact (https://www.politifact.com/truth-o-meter/promises/trumpometer/promise/1359/achieve-energy-independence/) claims the US continued with oil imports; while the Trump White House (https://trumpwhitehouse.archives.gov/issues/energy-environment/) states the US has become a net energy exporter for the first time in 70 years.