Gas Gouging Bill Sends Prices Higher

The Democrats extended their war on fossil fuel supply this past week with a bill against gouging, with zero evidence of any gouging because there is none. Prices are up because of Federal Reserve policy, USG stimulus which was pushed by Democrats and signed by Trump and Biden, and the Green/ESG war on plant-loving CO2.

The rise in prices this week has more to do with the Federal Reserve sounding way too dovish with some talk of pausing rate hikes in September. The market is showing them exactly what it thinks of that by blasting energy prices to new highs (the average price of crude this month will exceed that of March if the $112 holds through Tuesday) guaranteeing another bump up in the CPI. However, industries targeted for unjust political abuse are going to reduce economic activity over time. The expected gasoline prices is higher if a gouging bill becomes law.

This is worse setup than in the 1970s. Back then, Democrats were cutting regulations, but in hindsight they moved too slowly on opening the economy for Carter, resulting in a "free lunch" for Reagan as inflation imploded with deregulation and Volcker tag-teaming the supply-demand imbalance. This time, the Fed still hasn't convincingly signaled it will do whatever it takes on inflation and Democrats are escalating their attachment to bad policy.