Right now, you can ask Tom Friedman a question for Time Magazine's '10 Questions for' section. How fun!
My question is:
Do gas prices fall before elections because energy companies seek to take the issue off of the table, as a struggling economy tends to favor the Democrats, and lower gas prices help to alleviate financial suffering?
I'm sure I won't be placed in the top ten for publicaton, but even so an examination is in order.
I would love to go back twenty years or so, and examine each election specifically. Two problems arise. First, finding a twenty year chart of gas prices is tough. Second, such a large chart would make analyzing specific months up to the election difficult.
Additionally, it seems like 'the economy' as an issue really didn't arise as problematic until the 1992 loss of George Bush (for those looking to maintain Bush as Prez). We all remember James Carville's ubiquitous aphorism.
So the 'problem', for our purposes, is as follows:
Gas and energy prices have risen dramatically in the past sixteen years. This is due to a number of reasons, including increasing global demand and variated energy deregulations.
We'll focus here on gas prices, as they are the most psychologically prominent.
While prices are on a continuous trek upward, do they, as hypothesized, drop conspicuously in the months preceding an election, despite an otherwise stark upward trend?
We begin with the most recent election, in 2006.
On August 5, 2006, gas prices peaked (for the year) at just below $3/gal. Between this date and the mid-term election, only ten weeks later, gas prices dropped by a stunning 85 cents.
Looking at the election year 2004, we can see that between the middle of May 2004 and the middle of October, gas prices steadily dropped from a high of just below $2.10/gal. to about $1.85/gal.
Strangely (or, at least, against our hypothesis), prices jumped drastically in the weeks approaching the election, with the rise breaking just before election day.
In 2002, the country was still reeling from 9/11, and dealing with prices that had jumped sharply after the event. Oddly, the rise in gas did not really begin until 2 months after we had invaded Afghanistan, which happened in October. We saw gas jump from $1.10/gal to a whopping $1.40/gal. This number stayed steady through the election, which serves to antagonize the hypothesis, or to serve as an anomaly related to the terrorist attacks.
The big one, in 2000, follows the template I have laid out for my own nefarious purposes. In July of 2000, gas hit a brutal $1.70/gal, but slid to $1.40/gal in the months before the Gore/Bush contest. Oct 1997: $1.20/gal
Oct 1998: $1.00/gal
April 1996: $1.30/gal
Oct 1996: $1.20 gal
Results: Relatively inconclusive, with just about the amount of subtlety that one would expect such manipulators to employ were they to manipulating such things. :)
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