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As Memorial Day Travel Weekend approaches, Republican House Leader Kevin McCarthy and other members of his party are wrongly blaming President Joe Biden for the higher costs of gasoline and fuel. wood.
Gas prices have risen in recent weeks because a key pipeline was forced to shut down after a cyberattack on the colonial pipeline. And the lumber shortages that existed under the administration of former President Donald Trump were compounded by an unexpected real estate boom.
Shortages plagued the economy this spring, but most economists attribute most of it to the difficulties in restarting the US and global economies.
A look at the claims and the reality:
MCCARTHY: Gas prices are the highest since 2014, just at the start of summer. The recent hack of the Colonial Pipeline exposed the flaws in the Bidens approach to our country’s energy policies. On day one, he signed an executive order canceling the Keystone XL pipeline. blog post on Monday.
REPRESENTATIVE. LIZ CHENEY, R-Wyoming: From the cancellation of the Keystone pipeline to a ban on new leasing of oil and gas on federal lands, Bidens’ energy policies are having devastating consequences. We’ve already had a glimpse of this devastation with skyrocketing prices and gas shortages hitting communities across the country. tweet Friday.
THE FACTS: Bidens’ action on the Keystone XL pipeline has nothing to do with the recent spike in gasoline prices. The pipeline carries crude oil from Canada to Texas through the Midwest, not gasoline, which faced shortages on the east coast after the colonial pipeline was hacked.
Bidens’ order on his first day in office revoked the permit to construct an extension of the Keystone Main Pipeline, which is still in operation and runs approximately 2,687 miles (4,324 km) from Alberta to Alberta. Illinois and Texas.
An expanded 1,210 mile (1,947 km) pipeline was planned to allow the system to transport up to 800,000 barrels of crude oil per day through Montana, South Dakota and Nebraska.
But crude oil shortages were not a factor.
It should be noted that while gas prices are at their highest level in six years, oil prices are still slightly lower than they were in 2018. This suggests that oil supplies are adequate and that refining and the distribution of gasoline through networks such as the Colonial Pipeline is the problem. .
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MCCARTHY: Although gasoline prices are at historic lows around this time last year, the average price of a gallon of gasoline is currently $ 3.10. It’s the highest since 2014, when Joe Biden was last in the White House. blog post on Monday.
REPUBLICS on HOUSE BUDGET COMMITTEE: Bidens policies have led to the highest gas prices in six years. tweet Tuesday.
THE FACTS: Bidens policies are not the source of the price increases. Gas prices are on the rise due to a rapid and unexpected rebound in demand, and due to lingering problems with the forced shutdown earlier this month of the Colonial pipeline, which supplies 45% of the fuel consumed on the east coast. .
McCarthys’ comparison to a year ago is also misleading. Gasoline prices did not go down at the time because of the Trump administration, as Trump often claims; they have taken the plunge due to the coronavirus forcing people to abandon their offices, schools, business trips and vacations. Highlighting the link with the end of the pandemic, gas prices in the United States were at their lowest in April 2020 when people stayed at home the most, but have mostly increased since then, according to US Energy Information. Administration, even when Trump was still in office.
The most important factor in recent weeks has been the cyberattack on the colonial pipeline. Even though it has been operational again for almost two weeks, many states, mainly in the south, have still not fully recovered.
About a quarter of gas stations in North and South Carolina and Georgia are gas-free, according to GasBuddy.com, which tracks gas prices nationwide. In Florida, 9% of stations are sold out and in Tennessee its 14%. Overall, more than 6,000 stations are sold out, says Patrick DeHaan, Gas Buddys.
Prices also rose because the economy reopened much faster than most analysts expected. Stimulus payments to American households, including the $ 1,400 checks that were distributed in March, have helped Americans increase spending.
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RONNA MCDANIEL, President of the Republican National Committee: … Wood prices have increased by 400%. We have real problems … (Speaker of the House Nancy) Pelosi will do anything not to talk about Biden’s failures. tweet May 20.
THE FACTS: She’s also wrong to link the rise in lumber prices to Biden’s failures. This peak is also linked to the increase in demand and a strong economic rebound.
At the start of the pandemic in March 2020, sawmills actually cut lumber production, anticipating a slowdown in new home sales, according to economists at TD Bank. Instead, Americans and families in other countries looked for more space during quarantine and bought new homes or looked to renovate. This increased the demand for lumber, even as the supply was reduced, pushing up lumber prices.
The National Association of Homebuilders has pointed to insufficient domestic production going back to Trump for increases.
When prices started their all-time high in August 2020, the NAHB reached out widely to the Trump administration, with members of Congress and sawmills calling for swift action to address supply shortages that were hurting small businesses, builders and manufacturers. homes and ultimately to the global economy and is continuing to do so under the Biden administration, according to the group’s website.
Some of the price gains for lumber and other commodities reflect strong consumer demand for goods like housing and cars, which is actually a good sign for the economy. Most officials at the Federal Reserve, the agency responsible for controlling inflation, have repeatedly said that inflation will rise as the country reopens, but the increases will likely be temporary, as bottlenecks in the offer are resolved.
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