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The Poisoned Chalice That May Flip the Gas Price Issue

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The Republicans should be careful. Their current naïve faith -- that high gasoline prices on a Democratic president's watch gives them a political edge -- overlooks their own profound vulnerability, and seems to be based primarily on the (not entirely unwarranted) assumption that the president will parry, rather than thrusting at their own weak spots.

Begin with the blame game. High oil prices are largely the direct and inexorable result of the utter failure of successive American governments of both parties to take long term steps to reduce the market power of the oil cartel since 1972. So the unwillingness of the American political system to confront the power of international oil is the culprit. Everything else is short-term noise.

But the politics of the issue are mostly about this short-term noise. Public attitudes this season are focusing the blame in places that ought to worry the Republicans. The last time oil prices spiked, during the Bush Administration, the public blamed the oil companies first and the White House second.

But this time the oil companies are being linked to speculation and manipulation of the markets -- 38 percent of the public in a recent National Journal poll blamed "the manipulation of prices by large energy companies." Another 28 percent thought tensions in the Mideast were to blame. Only 14 percent blamed Obama -- 5 percent Congressional Republicans. (Other polls have found Congress more culpable than Obama, but none has found Obama to be primary focus of public anger. Indeed, 44 percent of respondents in another recent poll expressed greater faith in Obama on the issue.)

Why should this set of attitudes worry Republican candidates this year? Well, there is the potentially toxic fact that they are widely seen by the public as too close to the oil industry, an attitude likely to be reinforced as the media covers the sources of campaign money during the rest of the year, since Republicans get 88 percent of oil industry dollars, and have already raked in $14 million.

Worse, media coverage of money in politics this year is not primarily focusing on direct gifts to candidates, but much more on the financial backers of independent Super PACs. Here the Republicans seem almost fatally exposed. Their single most visible oil and gas patron, and the major funder of their pro-oil campaign efforts, the Koch Brothers, symbolize everything the public hates about speculative markets, oil companies and big money in politics. The Kochs are the major donors behind Americans for Prosperity, which led the oil industry's Solyndra-framed attack on the Obama Administration's loan guarantee program for clean energy. Koch was also heavily involved in the Keystone Pipeline effort, because it would have been a major financial beneficiary, and has frequently funded campaigns against wind energy.

But the Kochs are not an oil and gas exploration, production or refining company -- like Exxon, Valero or Anadarko. At their heart they are speculators. Indeed, they are credited with having invested the derivatives market in oil and gas, and having prevented it from being regulated every since.

Since even a pro-derivatives company like Goldman Sachs estimates that pure speculative pressure is responsible for $0.56 of the price of every gallon, the business that the Kochs are in is about as close to pure political poison as one can imagine -- and the Republicans can be certain that the Koch brand will be widely and broadly flashed in the electorates' face between now and election day.

Now not all big Super PAC donors are from the oil patch. The single biggest donor to Republican independent efforts thus far is Texas billionaire Harold Simmons. But while Simmons is not an oil man, his personal profile, with a deep history of manipulating government for his own profit in areas like licensing a private nuclear waste dump in Texas, market manipulation, and lead poisoning, resonates with that of the Koch Brothers and reinforces the image of Republican donors as being very definitely not on the side of the average American driver.

Nor is it particularly challenging to connect the dots between Super PAC dollars and Republican congressional votes and presidential campaign positions. The ongoing debate about oil industry subsidies, the consistent call of Republicans for higher profits and more giveaways for oil, and the willingness of the Republican leadership to block otherwise very populist measures to protect oil subsidies are all fodder for some very damaging campaigning in the fall.

So each of the major stories the Republicans are planning use against Obama this year -- high gas prices, the Solyndra bankruptcy, Keystone Pipeline, even deficit reduction efforts -- have all been poured from the poisoned chalice of their Super PAC oil donors.

Should the Republicans be confident that their spin on the price of driving will prevail? Or are they frenetically creating voter focus on a series of issues which may well, judo like, be turned against them? There's not much in the polls that would make be terribly confident if I were Karl Rove or Mitt Romney.

A veteran leader in the environmental movement, Carl Pope is the former executive director and chairman of the Sierra Club. Mr. Pope is co-author -- along with Paul Rauber -- of Strategic Ignorance: Why the Bush Administration Is Recklessly Destroying a Century of Environmental Progress, which the New York Review of Books called "a splendidly fierce book."

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