Bad political theatre

By Fester:

Bad political theatre is happening around oil policy.  McCain's policies are a joke when they are clear enough to define and analyze, and Obama is responding with non-effective and counter-productive proposals as well. Last week I argued that there are not many immediate policy action steps that can lower the price of oil in the next few months:

the best policy right now is to do nothing much and let the demand destruction in the pipeline go through...

But right now, the major adjustments that can be made to high gas prices will occur irrespective of any policy or position that is being debated in Congress or signed by President Bush.  We should (barring another Katrina/Ivan storm) see some relief come October and November due to seasonality factors, that is about all we can expect.

Now the BBC is reporting that Obama wants to tap the Strategic Petroleum Reserve for some short term relief.  I believe that releasing oilfrom the SPR is not a smart policy:

In the very short run (0 to 4 months) there is not a whole lot we can do to lower oil prices and maintain the semblance of a market economy.  Releasing oil from the Strategic Petroleum Reserve will increase supply on the market but some high cost suppliers may pull some of their oil off the market in response to the drop in prices.  The SPR is limited. It is not credible that it would be completely drained over the next few years to temporarily drop the price of gasoline by a couple of dimes. Since the SPR oil would be perceived as 'windfall' oil, it would not have a significant impact on long run prices.

Steven Taylor at Poliblogger looks at the policy and political implications.  I agree with his analysis:

What this is supposed to actually accomplish (aside from political theater and the illusion of “doing something” about the energy situation) is beyond me, especially since we have seen a slight roll-back of price due to some conservation.

Still this, along with the acquiescence by Obama that some off-shore drilling might be part of a comprehensive energy package, signals the significance of oil prices going into November. For Obama to be trying these moves at this time means that his campaign must think that McCain scored with his drilling stance from earlier in the summer.

I was hoping for better than cheap gimmicks as the cheap gimmick of the gas tax holiday was an expensive and ineffective cheap gimmick in the Democratic primary.  Both Hillary Clinton and John McCain were smacked down as panderers for that one.  I had hoped that model would be replicated to produce an incentive to offer at least vaguely plausible gimmicks and policy proposals.  Oh well, shit happens in the campaign funny season, and disappointment is guaranteed for anyone who is paying attention and has an opinion. 

But right now, the major adjustments that can be made to high gas prices will occur irrespective of any policy or position that is being debated in Congress or signed by President Bush.  We should (barring another Katrina/Ivan storm) see some relief come October and November due to seasonality factors, that is about all we can expect.

Now the BBC is reporting that Obama wants to tap the Strategic Petroleum Reserve for some short term relief.  I believe that releasing oilfrom the SPR is not a smart policy:

Comments

[carol]

Your last sentence kind of says it all right there. Sigh.