As Skyrocketing Energy Prices Pummel Americans With ‘Stagflationary Effects,’ The Biden Administration Shuts Down Yet More Domestic Energy Production

Americans Are Struggling With Massive Increases In Costs For Gasoline, Natural Gas, And Electricity, Yet The Biden Administration Obliviously Plows Ahead With Shutting Down More Oil & Gas Leasing And All Democrats In Congress Have To Offer Is Show Votes On Bad Legislation Economists Deride As ‘Dangerous Nonsense’ That Wouldn’t Have ‘Any Substantial Effect’ On Inflation


SENATE REPUBLICAN LEADER MITCH McCONNELL (R-KY): “Getting to work, running errands, driving to church, visiting loved ones, hitting the highway for a modest family vacation — all of it costs 88% more at the pump today than it cost when President Biden put his hand on that Bible. And it’s not even Memorial Day yet. The unofficial summer driving season hasn’t even begun. To be clear, this is not just ‘Putin’s price hike.’ The year 2021 saw the biggest one-year gas price increase in three decades and that was before Russia’s escalation in Ukraine. Farmers and ranchers, truckers, and small business owners are struggling to keep their tractors, eighteen-wheelers, and other work vehicles full of diesel. And so, in addition to having to fill up their own tanks, working families are paying for high fuel prices again at the checkout counter…. Since Day One, from cancelling Keystone XL to freezing leases for new exploration, President Biden himself has put American energy independence on the chopping block. But while Americans suffer, the far left just digs in deeper. Just yesterday Energy Secretary Granholm said the ‘volatility in prices’ was just more reason to ‘accelerate’ the supposedly green energy transition that Democrats have tried to force on the country for years. Forget that their preferred energy sources aren’t yet reliable or cost-effective. Forget that they would just be exchanging one kind of foreign dependence for new kinds of foreign dependence, on Russian critical minerals and Chinese supply chains for solar panels and batteries. Democrats’ proposals fall embarrassingly short. I understand the House is wasting its time pretending that inflation is all the fault of evil corporate profiteers. I guess the profit motive hadn’t been invented yet in 2019 when Republicans had unemployment low and inflation low at the same time. The liberal economist Larry Summers calls the House Democrats’ bill, quote, ‘dangerous nonsense.’ Jason Furman, another senior Obama advisor, has said the far left claims about so-called ‘greed-flation’ are in fact, quote, ‘unequivocally wrong and confused.’ … Washington Democrats keep finding new ways to fundamentally misunderstand Americans’ energy needs.” (Sen. McConnell, Remarks, 5/19/2022)

SENATE REPUBLICAN WHIP JOHN THUNE (R-SD): “There isn’t a day goes by where we don’t seem to see a new spike or a new high, I should say, in gasoline and diesel prices, at the very same time that the President’s approval ratings hit new lows. I don’t think that correlation is any coincidence. The high fuel prices in this country are attributable to this administration’s policies, many of which have discouraged oil and gas production, energy production right here in the United States most recently as last week, when the President took the Gulf in Alaska, some of these leases off limits, shut them down. It absolutely makes no sense if you’re concerned about the pocketbook pain that the American people are experiencing on a daily basis, the higher prices that they are experiencing at the pump, you would think you would be working aggressively to try and open up more energy production in this country. But this administration seems intent on doing just exactly the opposite, and that has been their plan from the beginning.” (Sen. Thune, Press Conference, 5/17/2022)

SEN. JOHN BARRASSO (R-WY), Senate Energy And Natural Resources Committee Ranking Member: “Joe Biden seems committed to a long-time situation of high gas prices all across the country. If not, why does he continue to try to choke energy production in the United States? Just last week, he canceled three major lease sales, oil and gas in the Gulf and in Alaska. And he can’t have it both ways. When the President one day says it’s Putin and the next day, the very next day, cancels these major oil and gas production leases, the American people see through this. The President has lost all credibility, in terms of dealing with inflation and the cost of energy. At the same time, the American people have lost all confidence in the ability of this President to relieve the pain that they are living with every day. For people driving past a gas station and they see that number over $4 a gallon, most people wince because they know it’s money that they’re not going to have for food and groceries, for clothing, or to do things with the kids…. The American people know we have the energy in the country, it is in the ground, and this administration will not let us get it out. This President is beholden to the climate elitists that call the tune for the Democrat Party.” (Sen. Barrasso, Press Conference, 5/17/2022)

SEN. LISA MURKOWSKI (R-AK): “When the signal is sent that this administration recognizes that domestic production, our own energy, is an asset and not a liability — that then sends a signal to the markets that can be real, that can be immediate and can be transformative. That sends a signal to investors that have been holding back…. That can be immediate. That signal can make a difference. And all it would take is President Biden standing in front of a microphone and saying ‘Given what is happening in this country, the unprecedented place that we are at today, the impact on everyday Americans, I’ve got an obligation to say Americans are going to come first and American energy production is going to come first.’ He could do that today.” (“As Gas Prices Blow Past $4, Capito And GOP Senators Blast Biden,” WV Metronews, 5/18/2022)

SEN. SHELLEY MOORE CAPITO (R-WV), Senate Environment And Public Works Committee Ranking Member: “I come from West Virginia. We drive everywhere. We drive to school, we drive to work, we drive to the grocery store, we drive to church, we drive to see our families, we drive to see our friends. I mean, we are rural America where cars are the only way to get to the places that you need to be…. So we have these high gas prices, we know that the solutions are there … Certainly, I come from an energy state as well, that can be a contributor to help bring America back to … energy security …” (Sen. Capito, Press Conference, 5/18/2022)

SEN. JAMES LANKFORD (R-OK): “For the ninth consecutive day in a row we hit the highest gasoline prices in the history of our country…. This is what real life looks like every single day for Oklahomans, when they’re trying to figure out how [they’re] going to buy groceries and all the different effects that they’re actually feeling…. The price of diesel is up, that means every single product that we buy that’s transported on a diesel truck all just went up in price. The price of all shipping went up. The price of all [agriculture] products just went up because every single tractor fuel price went up…. We’re feeling the effects on every single area of the economy because President Biden is unwilling to deal with the base of our economy, that’s energy prices.” (“Lankford, Senate GOP Blame White House For Record-High Gas Prices, Fox 23 News, 5/18/2022)

SEN. JONI ERNST (R-IA): “It is driving up every part of our economy. We rely on transportation to get goods from point A to point B, and the fuel costs are wrapped up in those goods…. First and foremost let’s unleash American energy, we have the capabilities we have the skills and we have the resources right here in the United States to be energy independent. We should not be subjected to these prices.” (“Lankford, Senate GOP Blame White House For Record-High Gas Prices, Fox 23 News, 5/18/2022)


Energy Costs Are Skyrocketing Under President Biden

Since President Biden was sworn in to office, the weekly price of all retail gasoline formulations has increased by more than $2. (U.S. Energy Information Administration, Accessed 5/18/2022)

Electricity prices have increased 11% year-on-year. (Bureau of Labor Statistics, Accessed 5/18/2022)

Natural gas prices have increased 23% year-on-year. (Bureau of Labor Statistics, Accessed 5/18/2022)

Fuel oil prices have increased 80% year-on-year. (Bureau of Labor Statistics, Accessed 5/18/2022)

As Of May 19th, Gas Prices Have Hit A Record High For Ten Consecutive Days

May 19, 2022 marks 10 straight days of record high gas prices. (AAA Gas Prices, Accessed 5/19/2022)

For The First Time Ever, Gas Prices Exceed $4 In All 50 States

“Not too long ago in some parts of the United States, paying more than $4 for a gallon of gas was seen as a coastal problem faced by Americans in pricey big cities. But now, for the first time, the average price for a gallon of gas has surpassed $4 in all 50 states. While the national average price has been hovering at or above $4 for weeks, Georgia, Kansas and Oklahoma had yet to cross the mark, according to data tracked by AAA.” (“Gas Prices Pass $4 Per Gallon In Every U.S. State For The First Time,” The Washington Post, 5/18/2022)

Natural Gas Prices ‘Have Also Surged To Their Highest Levels In More Than A Decade, Raising Costs For Everything From Home Heating And Cooking To Fertilizer, Chemicals And Wholesale Electricity’

“The Biden administration has been trying for months to dodge the political fallout from high gasoline prices. Now it has an even bigger energy headache to worry about…. [P]rices for another crucial fossil fuel — natural gas — have also surged to their highest levels in more than a decade, raising costs for everything from home heating and cooking to fertilizer, chemicals and wholesale electricity…. U.S. natural gas prices have more than doubled since the start of the year and are forecast to average over $8 per million British thermal units for the rest of 2022, well above the $2 to $4 range the fuel has typically traded inside for the past decade.” (“Biden’s Battling One Energy Price Nightmare. Here Comes Another.,” Politico, 5/13/2022)

Electricity Rates Are Going Up Too: ‘These Price Hikes Are Being Felt Nationwide’

“Electric power generation rates are going up — way up, industry observers say. After a recent wholesale energy auction, electric generation rates are expected to rise in June, largely due to market pressures, said Matt Schilling, a spokesman for the Public Utilities Commission of Ohio (PUCO)….  Effective June, for AES Ohio customers using 873 kilowatt-hours (kWh) each month (matching the average residential Ohioan’s usage), the ‘standard offer rate’ portion of their bill will be $95.25, more than double the current $41.95, according to the PUCO.” (“Your Electric Bill Is About To Get A Lot More Expensive,” Dayton Daily News, 5/04/2022)

  • “Mary Ann Kabel, a spokeswoman for AES Ohio, cited a number of factors. ‘Due to a number of conditions including the situation in Ukraine, inflation, price of natural gas and market conditions our customers will see rates increased by $0.06 per kWh, potentially doubling the price of the standard service offer,’ she said in an email. ‘The new rates will go into effect in June 2022.’” (“Your Electric Bill Is About To Get A Lot More Expensive,” Dayton Daily News, 5/04/2022)
  • These price hikes are being felt nationwide. Natural gas produces about 40 percent of America’s electricity. Maha Kashani, senior regional sales manager for Dublin, Ohio-based retail energy supplier IGS Energy, said she and her colleagues have seen an ‘incredible amount of instability in the natural gas and electricity markets over the past year.’ ‘We have seen an incredible amount of volatility in the natural gas and electricity markets over the past year,’ Kashani said in an email Wednesday. ‘Limited production response coupled with increased demand and perceived risk have led to a rapid run-up in prices. I haven’t seen anything like this before in my career, and I’ve been doing this for more than 10 years.’” (“Your Electric Bill Is About To Get A Lot More Expensive,” Dayton Daily News, 5/04/2022)

“Lehigh Valley homeowners and renters will pay as much as $34 more per month, on average, this spring for electricity. That’s how much PPL Electric Utilities says it’s raising average residential bills effective June 1, based on a rate hike of 38.3% from 8.941 cents per kilowatt-hour to 12.366 cents per kWh and average use of 1,000 kWh per month. FirstEnergy Corp.’s Met-Ed on June 1 is raising residential rates 16.3% from 6.83 to 7.94 cents per kWh.” (“Lehigh Valley Electric Rates Are Rising 16% To 38% For Homes,” Lehigh Valley Live, 5/04/2022)


President Biden’s Treasury Secretary Admits That ‘Higher Food And Energy Prices Are Having Stagflationary Effects’

TREASURY SECRETARY JANET YELLEN: “[A]nd higher food and energy prices are having stagflationary effects… These pressures are not likely to abate in the very near future” (“Yellen Warns Of ‘Stagflationary Effects’ Of Higher Food And Gas Prices,” Axios, 5/18/2022)


And Yet The Biden Administration Continues To Shut Down American Energy Production, Most Recently By Canceling More Oil And Gas Lease Sales In Alaska And The Gulf Of Mexico

“The Biden administration has canceled one of the most high-profile oil and gas lease opportunities pending before the Interior Department. The decision, which halts the potential to drill for oil in over 1 million acres in the Cook Inlet in Alaska, comes at a challenging political moment, when gas prices are hitting painful new highs…. The department also halted two leases under consideration for the Gulf of Mexico region …” (“Biden Administration Cancels Alaska Oil And Gas Lease Sale,” CBS News, 5/13/2022)

“Frank Macchiarola, a senior vice president at the American Petroleum Institute, a trade group that represents oil and gas companies, said in a statement that he would ‘urge the administration to end the uncertainty’ for the oil industry and issue the five year plan. Mr. Macchiarola said the decision to scrap lease sales in the Gulf of Mexico and Alaska ‘is becoming a pattern’ in the Biden administration. ‘The administration talks about the need for more supply and acts to restrict it,’ he said.” (“Biden Administration Cancels Drilling Sales in Alaska and Gulf of Mexico, The New York Times, 5/12/2022)

FLASHBACK: Biden Administration Officials: ‘President Biden Remains Absolutely Committed To Not Moving Forward With Additional Drilling On Public Lands’

WHITE HOUSE NATIONAL CLIMATE ADVISOR GINA McCARTHY: President Biden remains absolutely committed to not moving forward with additional drilling on public lands. The challenge that we faced was that we had a court that ordered a new lease to be done. The Department of Energy had no choice but to put it out. But they also found ways to reduce the size of that and its impact. And we’ll keep doing what we need to do to appeal those decisions and to make our case in a court.” (MSNBC’s Hallie Jackson Reports , 4/20/2022)

WHITE HOUSE PRESS SECRETARY JEN PSAKI: “Well, let me first say that today’s action … was the result of a court injunction that we continue to appeal.  And it’s not in line with the President’s policy, which was to ban additional leasing … I would just note that we are going to continue to fight this court injunction that is forcing our hand in allowing this to proceed, even as we have taken actions to reduce by 80 percent the areas to lease and impose stringent environmental standards…. [A]gain, these leases are not in line with our policy or the President’s view.” (White House Press Briefing, 4/18/2022)


Meanwhile, Democrats In Congress Are Only Offering ‘Show Vote[s]’ On Bills Serious Economists Call ‘Dangerous Nonsense’ Based On Nothing More Than ‘A Conspiracy Theory’ About Inflation

“SHOW VOTE: The nationwide average price for a gallon of gas hit another all-time high on Sunday, at $4.47, but the House and Senate are set for inaction. Democratic leadership’s preferred policy response to record-high gas prices is to vote on a bill, H.R. 7688 (117), that would give the Federal Trade Commission the power to penalize oil companies if the government can prove they are inflating the price of gasoline. The bill is on the House agenda this week, but it has no chance of getting GOP support. The idea to use legislation to punish price gouging was also called ‘nonsense’ by former President Barack Obama’s chair of the Council of Economic Advisers. And it didn’t exactly get a ringing endorsement from DOT Secretary Pete Buttigieg on Sunday.” (“The Gasoline Price-Gouging Fight To Nowhere,” Politico’s Weekly Transportation, 5/16/2022)

Liberal Economists: ‘The Price Gouging At The Pump Stuff … Is Dangerous Nonsense,’ ‘[M]any Of The Arguments For ‘Greedflation’ Are Unequivocally Wrong & Confused’

LARRY SUMMERS, Former Clinton Administration Treasury Secretary: “The price gouging at the pump stuff, the more general price gouging stuff … It is dangerous nonsense. There is no material prospect that in any enduring way gouging legislation can have any substantial effect on inflationary pressure. But it can cause and contrive all kinds of shortages… This gouging talk is a diversionary confusion.” (Bloomberg TV’s “The Balance of Power,” 5/13/2022)

JASON FURMAN, Former Obama White House Chair of the Council of Economic Advisers: “[M]any of the arguments for ‘greedflation’ are unequivocally wrong & confused…. Most importantly … I think that 5% fines on corporations for raising prices above cost and price controls on gasoline are genuinely terrible ideas.” (Jason Furman, @jasonfurman, Twitter, 5/15/2022)

  • FURMAN: “When more people want to buy things than companies are capable of making, prices go up. That’s just the law of supply and demand… Companies always want to maximize their profits. I don’t think they’re doing it any more this year than any other year.” (NPR, 1/12/2022)

‘If You Like Today’s Baby Formula Mess,’ You’ll Love Democrats’ ‘Price Controls By Another Name’

THE WALL STREET JOURNAL EDITORIAL BOARD: “As night follows day, the economic problems caused by government are invariably followed by government solutions that would make everything worse. For a classic of the genre, consider the bill introduced by Democratic Senators to fight inflation by attacking price ‘gouging.’ Massachusetts Senator Elizabeth Warren and seven Democratic colleagues in the Senate and six in the House want to punish companies that raise prices more than they like. The result would be price controls by another name, and they would produce what price controls always do—supply shortages. If you like today’s baby formula mess, pass this bill.” (Editorial, “The Senators From Venezuela,” The Wall Street Journal, 5/16/2022)

Democrats’ Obsession With ‘Price Gouging’ Is ‘A Conspiracy Theory’ That ‘Is Encouraging Democrats To Pursue Policies That Could Be Actively Harmful’

THE WASHINGTON POST’S CATHERINE RAMPELL: “A conspiracy theory has been infecting the Democratic Party, its progressive base, even the White House…. Call it ‘Greedflation.’ The theory goes something like this: The reason prices are up so much is that companies have gotten ‘greedy’ and are conspiring to ‘pad their profits,’ ‘profiteer’ and ‘price-gouge.’ No one has managed to define ‘profiteering’ and ‘price-gouging’ more specifically than ‘raising prices more than I’d like.’ For example, a bill introduced on Thursday by Democratic Sens. Elizabeth Warren (Mass.) and Tammy Baldwin (Wis.) and Rep. Jan Schakowsky (D-Ill.) bans ‘price-gouging,’ which it defines as ‘unconscionably excessive’ pricing. What counts as an ‘unconscionably excessive’ price, you ask? TBD, but it’s definitely going to be illegal…. The problem with this narrative is that it’s just a pejorative tautology…. At best, this approach has done nothing to curb inflation. Worse, it has distracted Democrats from taking actions that could help, because this ‘greedflation’ narrative has persuaded both policymakers and the public to misdiagnose the problem’s causes. Worst of all, it is encouraging Democrats to pursue policies that could be actively harmful. These include a proposed tax on ‘windfall’ oil profits, which would likely reduce oil production exactly when we want output to increase. Or a mass student debt jubilee, which could drive consumer demand even higher. It may feel good to throw red meat to the anti-corporate populist left. Righteous fury about evil businesses earns plenty of retweets. But it has also hampered Democrats’ efforts to get inflation under control — and in so doing, sabotaged their reelection prospects.” (Catherine Rampell, “An Inflation Conspiracy Theory Is Infecting The Democratic Party,” The Washington Post, 5/12/2022)



Related Issues: Inflation, Energy