Congressman Called for Gas Relief

Michael Giberson

Congressman Brian Higgins, of western New York, put out a press release last week welcoming the news that the Obama administration will release 30 million barrels of oil from the Strategic Petroleum Reserve. (“Higgins Welcomes News of Oil Release: Congressman Called for Gas Relief Measure in April.”) The rest of the press release was a listing of all of the efforts the congressman has supported with the intent of “keeping gas prices reasonable.”

 Our efforts include: fighting to remove subsidies to oil companies, regular monitoring of local prices to ensure they correlate to others in the region, responsible domestic drilling and aggressively pursuing alternative energy.”

I’m surprised to see “fighting to remove subsidies to oil companies” as the first listed effort to keep gas prices reasonable. Presumably the subsidies tend to shift costs from consumers as a group to taxpayers as a group and therefore lower the price of gas (if not the ultimate cost). I’m against subsidies to energy companies, however, so glad to see Congressman Higgins on the case.

A bit more, uh, laughable might be the polite term, is the press release’s claims of Higgins’s success in fighting to bring gasoline prices down:

In the fall of 2008 Congressman Higgins fought unjustifiably high gas prices in WNY.  He met with the Chairman of the Federal Trade Commission and demanded an investigation into high prices.

Over the six month period during which the Congressman vocally rallied against and demanded answers the high local gas prices decreased by $1.18 due in part to the Congressman’s actions.

In fact the FTC’s letter credited the Congressman for falling prices saying, “we note that prices began to fall soon after you raised public concerns about the elevated prices.”  The Congressman continues to monitor local gas prices through his website to make sure local gas prices aren’t unjustifiably higher than other upstate regions.

In brief, after the Hurricanes Gustav and Ike hit oil producing areas in the Gulf, prices spiked nationally for a while before resuming the sharp drop in oil and gasoline prices that had begun in the summer. Prices in Western New York were falling a little bit less sharply than prices elsewhere in the state. The Congressman began publicly complaining about the change in relative prices with respect to elsewhere in the state.

What evidence is there for the claim that prices fell “due in part to the Congressman’s actions”??? Essentially none. Notice that the FTC letter to the Congressman only observes that prices began to fall after the Congressman had complained, not that the Congressman had anything to do with prices falling. (I posted a link to the FTC letter to Congressman Higgins in a July 2009 post along with extensive commentary.)

The press release adds that Higgins is co-sponsoring the current version of the Federal Price Gouging Prevention Act, apparently languishing in committee, which I am on record as saying is a bad deal for consumers and merchants.

So the Congressman’s press release is nothing more than a list of ineffectual, misrepresented, or misguided efforts. No real suprise, right, I mean no one reads press releases for their truth content. Still, someone thought highly enough of the press release to reproduce it more or less word-for-word on a newspaper website, so I thought it worthwhile to point out some of the limits of the report.

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