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Acton Commentary: High Gas Prices Devastating to Poor

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My commentary this week focuses on the how the rise in prices at the pump is impacting the poor. Currently, in many areas of the country a gallon of gas is now priced over $4. I also argue that we need a more coherent energy policy coming from leaders in Washington. Part of the argument against drilling in ANWR (Arctic Refuge) over a decade ago was that the oil wouldn’t hit the market for 10 years. That’s a very shortsighted way of thinking about meeting our energy needs. We need leaders in Washington to work for us not against us.

Perhaps now a forgotten event, former Senator Jesse Helms in 1982 waged a dramatic battle against a federal gasoline tax hike of five cents. The tax hike had bipartisan support, including the support of President Ronald Reagan. However, Helms fought virtually alone with only a small cadre of tax opponents. He eventually lost on the measure but as he was traveling back to North Carolina he stopped at a rural Hardees restaurant. Truckers recognized Helms and he was greeted with thunderous applause for his efforts. Helms stood up not just for business interests like the trucking industry, but the rural poor, who are hit hardest by increases in gas prices. The current federal tax on a gallon of unleaded gasoline is 18.4 cents per gallon and the mean state tax on a gallon is 26.6 cents. My commentary is printed below:

High Gas Prices Devastating to Poor

by Ray Nothstine

Religious leaders staging a fast over budget cuts on social spending have not offered to fast over higher gas prices, even though the impact on the poor is devastating. In fact, there is very little focus on the rise in energy costs, with political and religious leaders remaining largely silent. Yet, when they speak on the issue, they often do not have your best interests in mind.

At a recent visit to a wind turbine plant, President Obama responded to one questioner’s concern about rising prices by laughing and saying, “If you’re complaining about the price of gas and you’re only getting 8 miles per gallon, you might want to think about a trade-in.” The president didn’t say which vehicle he was talking about. But a 2003 Hummer H2, rated among the worst for gas mileage, scores 10-14 miles per gallon.

But for most people a truck that is getting 8 miles per gallon is the one that delivers their food. This is true too for charitable food banks as delivery costs cut into the number of people they can feed. Food banks also depend on volunteer drivers to deliver meals to shut-ins.

Many individuals and families are already curtailing discretionary spending to save for gas. In turn, more money and jobs exit the U.S. economy for oil exporting countries.

The national average for a gallon of gas is currently $3.79. Some American cities are well over $4 per gallon. The price, up almost a $1 since last year at this time, has some experts forecasting $5 for Memorial Day.

While oil markets can be complex, free market alternatives offer better relief than heavily subsidized “green energies” propped up by government. A new study in the United Kingdom by Stuart Young Consulting and the John Muir Trust again pointed out what previous studies have found: Wind output is often less than anticipated and is an unreliable source of energy.

Likewise, electric cars are rejected by consumers shopping for fuel economy—even though they are subsidized with tax credits. Rachel Slobodien of the Heritage Foundation points out that people are instead buying more affordable super fuel economy cars with traditional engines that get upwards of 50 miles per gallon.

Some lawmakers from both parties in oil producing states are asking for more domestic drilling, more refineries, and uniform state standards on gasoline mixture requirements. All of these proposals will help lower prices and could add hundreds of thousands of American jobs.

President Obama has responded by saying an increase in domestic drilling “will help some.” He also signaled he may be willing to tap more of the Canadian oil sands, but at the same time, he wants to cut oil imports by one-third.

High prices at the pump can offer a moment to pause too and remember a spiritual truth. The price of gas not only draws attention to the Middle East, but it draws our attention back to the Garden of Eden that tradition places in that oil-rich region.

Oil itself is decayed vegetation and plankton that has seeped into the ground, forming over millions of years. At one time wildlife was abundant and forests were especially lush in the garden. In the creation story we are reminded that after the fall of man, we have to toil for resources (Genesis 3:19).

While we are bound to labor, 17th century Bible commentator and Presbyterian minister Matthew Henry reminds us, “Let not us, by inordinate care and labor, make our punishment heavier than God has made it; but rather study to lighten our burden.”

Similarly, John Paul II declared, “Besides the earth, man’s principal resource is man himself. His intelligence enables him to discover the earth’s productive potential and the many different ways in which human needs can be satisfied.”

This is good advice. The free market helps to sort out those effective alternatives, encouraging us to drill for oil responsibly at home, and protecting us from costly utopian schemes that drive up energy prices. The market is also our best hope for developing renewable energy technologies that are economically feasible.

We know too well that leaders in Washington reflect the fall of man, but they are not working to lighten our burden right now. As the price of gas approaches $5 per gallon, perhaps its rise may help us to refocus on new ways to meet the needs of those who have the most to lose from rising fuel costs.

Ray Nothstine is opinion editor of the the North State Journal in Raleigh, North Carolina. Previously, he was managing editor of Acton Institute's Religion & Liberty quarterly. In 2005 Ray graduated with a Master of Divinity (M.Div) degree from Asbury Theological Seminary in Wilmore, Ky. He also holds a B.A. in Political Science from The University of Mississippi in Oxford.


  • Ted Seeber

    Given the problem that gas taxes were supposed to solve- providing money to repair the roads- I wonder if we’d just be better off with an odometer tax of $.005/axle/mile, with an additional surcharge of .01/axle/mile for studded tires.

    Get rid of gas taxes- make it a flat rate consumption tax based on what really damages the road- the tires, not the fuel burned.

  • The gov’t doesn’t consider me ‘poor’ since I’m a nurse at a local hospital. What they don’t consider is that I’m sole support for 2 other people. At this point, in order to pay our ever-rising cost of living bills, I have to use every cent available from my paycheck. That means that I now owe the IRS $2000 for 2010. Throw $4/gal gas prices into the mix & we are being squeezed beyond the point of endurance. All the POTUS has to say on the matter is to advise us to quit driving SUVs. Since I don’t own one, that advice isn’t much help. He reminds me of Marie Antoinette saying that the peasants could eat cake if they couldn’t find any bread. God, please, deliver us!!!!!!!

  • Praying for lower gas prices. Literally.

    CNN’s Carol Costello talks to pastor Marshall Mabry of Beacon of Light Christian Center in Dublin, Georgia about how his congregation will be praying at the pump this weekend. (April 13th, 2011)

  • Pingback: links for 2011-04-14 | The 'K' is not silent()

  • Ray, many thanks for a stimulating piece, and for the @ActonInstitute reply to my Tweet.

    You will, I think, find that the pressures on places as diverse as the Dakotas, rural Iowa or Pennsylvania, and remoter parts of Indonesia, South Africa, and Scotland arise directly because gas is so cheap. One disadvantage of cheap gas is that it creates more opportunities in places that are already more richly endowed with resources. Hence we have seen ongoing agglomeration for over 2 centuries, with very negative consequences for remote places: namely the hollowing out, declines and decay I referred to.

    With cheap transport China has taken on the role of ‘factory for the world’. That change has made us richer, by freeing up resources, but leaves the less productive resources idle as long as there is surplus capacity. (And, surplus capacity is strongly suggested by the recent recession, because it was ‘demand-driven’). Cheap gas thus, to quote but one example, means that seasonal market gardens (which produce more from our resources) are no longer economic. And so, useful resources go to waste, while gas is used as though that part of creation was not to be treasured.

    Is there any sense in commuting long distances? If it could be done in an hour and a half, people would clog the airspace commuting from London to South Africa. With better roads and cheaper gas, incentives dictate that people will, on average, just commute longer distances and buy products from further away.

    Perhaps $400 oil and bicycles would be better for our health and for the world?

    Best wishes
    Mark A Reader

  • Roger McKinney

    Mark, China has taken the role of ‘factory for the world” in consumer goods only. It has an advantage in producing consumer goods because its labor is cheap, for now. That’s changing. Americans can make cheap consumer goods because our wages are too high, but that’s a good thing.

    But you’re right about traveling long distances by road in the US. It’s stupid, and the foul result of Eisenhower’s policies of covering the nation with concrete. Had the government stayed out of transportation our traveling habits would be much different. We would use cars for short distances, trains for medium and airlines for long distance travel.

  • $6 Gas? Could Happen if Dollar Keeps Getting Weaker (CNBC, April 20)

    A dollar plumbing three-year lows is hitting Americans squarely in the gas tank, and one economist thinks it could drive prices as high as $6 a gallon or more by summertime under the right conditions.

    With the greenback coming under increased pressure from Federal Reserve policies and investor appetite for more risk, there seems little direction but up for commodity prices, in particular energy and metals.

    Weakness in the US currency feeds upward pressure on commodities, which are priced in dollars and thus come at a discount on the foreign markets.