Late to the excoriation

by wfgodbold

But why should I let that stop me?

Yesterday, President Obama responded to a question about high gas prices thusly:

“If you’re complaining about the price of gas and you’re only getting 8 miles a gallon, you know,” Obama said laughingly. “You might want to think about a trade-in.”

Because the best time to buy a car is in the midst of a recession. Better to buy now, though, than later (I guess?), since your money is only going to be worth less as inflation increases (Hooray for pumping worthless dollars into the money supply!). Ed Morrissey points out that this makes Obama actually sound worse than Marie Antoinette.

Even setting aside the fact that some people need larger cars (unless large families are being disincentivized), and those cars (of course) tend to get worse gas mileage than smaller cars, in the long run it’s cheaper (especially at current gas prices; if they go up by a lot, the math changes) to continue driving your 8 mpg tank than a car with better mileage.

If you drive 15k miles/year at 8 mpg, you’d be spending $6900/year on gas at current prices; upgrading to a car that gets, say, 40mpg would decrease that amount to $1380/year. Sure, it’s $5600 less per year, but at that rate it would still take 4-6 years of savings to pay off the new car. If you have more than a couple kids, you won’t be able to fit them in a 40 mpg vehicle anyway. The Ford Transit Connect van gets 25 mpg on the highway and runs $23k. At that mileage, you would save $4600 a year over the 8 mpg vehicle, and it would still take you at least six years to pay off the new van.

Gas prices average $3.684/gal (as of 4/4). That’s doubled since Obama’s inauguration (when gas was $1.813/gal (historical gasoline price data from here). Well, we can’t really hold him responsible for the low price then; he hadn’t yet done anything, after all.

One year later, though, gas was still only $2.666/gal. That’s an 80¢/gal increase (and this was three months before the Deepwater Horizon spill). Since then, gas has increased in price by another $1/gal. As the chart below shows, even that increase didn’t really start until around September/October of 2010.

The main increase dovetails approximately with the timing of the administration’s seven-year drilling moratorium. I’m not saying that alone is the cause; like the man says, the government can do many things that will drive gas prices up.

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