Presidential candidate Michele Bachmann said that, if elected President, she'd cut the cost of gas to $2.
“The day that the president became president gasoline was $1.79 a gallon. Look at what it is today,” she said at an event in Greenville, S.C. according to Politico. “Under President Bachmann, you will see gasoline come down below $2 a gallon again. That will happen.”
The average price of gas is now around $3.58 nationwide, according to AAA, and closer to $4 in urban areas in California.
Bachmann didn't detail how she'd perform that trick. Oil prices are set globally and increased drilling in the U.S. would only add a small amount to the overall pool. In any event, any output -- which would trickle in over the course of several years -- would be countered by a reduction in imports. Demand also continues to surge in China and the emerging world, keeping upward pressure on the price.
But since Bachmann didn't provide any answers, we are left to speculate on what she might propose. Some of the ideas her campaign might be pondering:
--Subsidies. Fuel and energy subsidies are used worldwide to keep the cost of oil down. Indonesia spends 10 to 28 percent of its national budget on energy subsidies. Tea Party fans might recoil at subsidies -- isn't that what the renewable industry gets? But subsidies disguised in the right way are popular: both Alaska and Montana, two strongholds of Tea Party support, both receive more in federal funds than they pay in taxes. If she packaged a gas fund as the Freedom to Buy Gas and Slim Jims at a Convenience Store Act, voters could view this as a moral defense of liberty.
--Drill. That could be a challenge. The Energy Information Administration estimates that the U.S. had 22.3 billion barrels of reserves at the end of 2009. The U.S. consumes around 20 million barrels of oil a day, or about 25 percent of the world total. That leaves enough oil for 1115 days, or just over three years. That wouldn't even last her first term. Alexis Madrigal at The Atlantic notes that the USGS has stated that the touted Bakken formation in North Dakota is a "significant" formation but it might only contain 4.3 billion barrels of technically recoverable oil. Oil from shale formations in the U.S. came to 275,000 barrels a day.
--Eliminate Safety Regulations on Existing Rigs. The BP disaster was an act of God, rival candidate Rick Perry and fellow Congressional Representative Tom Cole have suggested. God doesn't like fish -- get it through your head, people. You think Fish Stick Friday was just a coincidence?
--Cut Gas Taxes and Invalidate State Laws. The federal excise tax on gas is 18.4 cents a gallon, the same level it was at 18 years ago in 1993. The tax on diesel at the federal level is 24.4 cents. States actually tax gas at a higher level: the national average for gas is 48.1 cents per gallon and for diesel it is 53 cents. Going after the states would have to be a nationwide effort. Not just lefty states tax gas: Texas has a 20 percent gas tax. Bachmann's home state of Minnesota has a higher gas tax (27.2 cents per gallon) than that bastion of socialist stateism known as Massachusetts (23.5 cents).
Eliminating all taxes would bring the price of gas close to $3 a gallon, putting her still $1 away from the elusive $2 goal. Approximately 60 percent of federal gas taxes, however, go to maintain roads and bridges. Gradual dilapidation would prompt people to drive less, thereby curbing demand and prices. It's a classic market-based solution.
--Go After Banks and Oil Companies. It might help, but very little. Credit and debit card fees add another 4.7 cents per gallon. Interestingly, the gross profit margin is only 16.3 cents per gallon.
--Invade. It's been tried, but found wanting. After Iraq was overturned, BP and China Offshore Oil Company won the largest oil concessions from the country's new government.
--Coal. Not according to this MIT study from May. It says that liquid fuel from coal could cost $91 per barrel in China, India and the U.S. and $105 to $118 per barrel in Europe, not including carbon-capture technology. The coal-to-liquids process is also generally quite polluting so this could be a tough sell. If carbon caps or emissions technology were imposed, the price would rise. Biofuels could also undercut the price of coal to liquids even without carbon controls.
The MIT study predicts that coal to liquids could account for 15 percent to 18 percent of world liquid fuel supply by 2050, but this assumes light regulation and that biofuels don't become economical. (With virtually no regulation and a pervasive lack of biofuels, coal could supply one-third of all liquid fuels, but a no-policy world already seems highly unlikely.) With cap-and-trade and available biofuels, liquid coal may not be viable at all, or could hit low single digits. But either way, $91 a barrel fuel wouldn't bring the price down to Bachmann's $2 mark.
--Biofuels. She's vetoed biodiesel legislation more than once.
U.S. oil imports, by the way, actually have dropped under Obama. The U.S. imported 49.3 percent of its oil in 2010 compared to 60.3 percent in 2005 and nearly 67 percent toward the end of the Bush era.