Wednesday, April 4, 2012

The Political Effects of Oil Price Rises

I can't sleep.  Therefore, I will blog.

I found this piece regarding the effects of oil price rises on the electoral college to be very interesting and relevant.  Much recent poll data suggests that Americans are angry with the Obama administration about high oil prices.  Interestingly enough, states that traditionally vote liberally have witnessed the highest oil price levels (**however, I say levels and not rises, which is arguably more important in spending/consumption effects).  However, as a percentage of their incomes, republican-leaning states have been hit the hardest by these oil price spikes.  Lastly, judging by the PIIE graphs, increases in unconventional oil production benefits republican states the most in terms of revenue (assuming it is kept in-state), which would make republicans' (positive) thoughts on the Keystone XL Pipeline appropriate (most states it runs through are republican).

Real Implications from the PIIE data:

- 4 swing states (Florida, Pennsylvania, Michigan, and Nevada--71 electoral votes) pay higher than the national average for gasoline, while the remaining 8 pay a lower average, and total 80 electoral votes

- Swing states of Michigan, North Carolina, and Iowa hit the hardest by gasoline prices increases as measured by the share of personal income spent on gas; Colorado and Pennsylvania's gas consumption/personal income is not as high

How the voters decide may or may not be driven by oil and gasoline prices, but along with controversy surrounding the Keystone XL Pipeline, I believe it will indeed play a role in the minds of many voters.

The following table sums up the data:

Table 1 Battleground breakdown 
  Gasoline pricesGasoline expendituresOil productionElectoral votes 
  price per gallonvs. US average
percent of personal incomevs. US average
barrels per capitavs. US average
 North Carolina$3.7599.64.91170.0015 
 New Mexico$3.5794.74.611037.05275 
 New Hampshire$3.7198.54.61100.004

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