President Biden delivered a speech Tuesday on the economy and rising oil prices in which he sought to avoid responsibility for rising prices and supply chain issues, while congratulating his administration for slapping a Band-Aid on the larger problem of declining American energy independence under his leadership.
Katie Tubb, senior policy analyst in Heritage’s Roe Institute for Economic Policy Studies, released a new fact-check today pushing back on Biden’s false claims that other countries and private companies are to blame for the increase in energy prices.
Claim No. 1: Americans are experiencing rising energy prices because countries and companies have not ramped up the supply quickly enough to meet the demand. “A big part of the reason Americans are facing high gas prices is because oil-producing countries and large companies have not ramped up production of the supply quickly enough to meet the demand, and the smaller supply means higher prices globally for oil.”
Tubb: “The economy is not a light switch that governments can just flip back on. The pandemic, and government responses to it, sent shock waves through energy markets. As President Biden has figured out that Americans are upset with high gasoline prices, he has looked to harmful shortcuts like a release from the Strategic Petroleum Reserve, and shifted the blame for his administration’s willful restrictions on domestic energy production onto American oil companies. But at the same time President Biden is looking for a short-term fix to high energy prices this winter, he seems to have no qualms about endorsing policies that will lock in higher energy costs and cut off supplies.
“Gasoline prices today are higher than they’ve been since September 2014. Ninety percent of Americans’ transportation fuel is provided by oil. While there is only so much a president can do to override market forces, President Biden has done worse than nothing. Rather than relieve regulatory roadblocks to affordable energy—like lifting the Jones Act and the ethanol mandate—President Biden has aggressively deployed regulators across the executive branch to make it more difficult to explore for and produce oil, construct and operate pipelines, access financing and private sector investment, and use gasoline in cars and trucks.
“President Biden made a political example out of the Keystone XL pipeline and has so far failed to show leadership, as his counterpart in Canada has done, to defend existing pipeline infrastructure serving American families across the country. He has used his bully pulpit from day one to vilify the oil industry rather than implement simple and effective policy solutions. Further, President Biden continues to boost the so-called ‘Build Back Better’ bill, which would increase oil prices by adding new fees and regulations on oil producers and cutting access to oil off American coasts.
“Feeling heat from rising gasoline prices, President Biden authorized two releases totaling 50 million barrels of oil from the Strategic Petroleum Reserve to be delivered between the end of December through April 2022. The Strategic Petroleum Reserve is not for providing political relief and is not an ‘easy button’ out—the issue at hand is about America’s ability to produce and transport energy.”
Joel Griffith, research fellow with Heritage’s Roe Institute for Economic Policy Studies, released a fact-check that highlights the government policies responsible for supply chain problems and rising prices that Biden seems to conveniently ignore.
Claim No. 2: Biden says "families can rest easy" this holiday season and said that stores will be "well-stocked" amid supply chain crisis. “All of these concerns a few weeks ago, there would not be ample food available for Thanksgiving, so many people talked about that, understandably. But families can rest easy, grocery stores are well-stocked with turkey and everything else you need for Thanksgiving and the major retailers I’ve mentioned have confirmed that their shelves will be well stocked in stores this holiday season.”
Griffith: “Your Thanksgiving Day meal is going to cost about 8% more, nearly twice the increase in average weekly earnings since a year ago. Earlier this month, the Wall Street Journal reported turkeys were only 39% in-stock, far below a typical year with at least 93% in-stock and even far below last year in the midst of the pandemic shutdowns with 70% in-stock.
“Government policies are indeed suppressing the supply of goods. For instance, the extensive bottlenecks this year—including ensuring delivery of that turkey from the farm to your table—are caused by continued COVID vaccine mandates; tightening environmental regulations on the trucking industry; older diesel trucks increasingly being banned from the roads in California; worker shortages among drivers, warehouse workers, and retail staff (caused by government policies); and onerous distancing and capacity restrictions on processing plants. A tsunami of government spending contributed to the rise in demand, while government policies simultaneously impeded the supply and transportation of these goods.
“Government basically suppressed supply while stimulating demand with copious spending. The Biden administration is now working hand-in-hand with the central bank to allow the government to spend enormous quantities of money without, right now, raising taxes outright. This is government by the elites, for the elites, and most Americans are suffering for it.”