Mississippi Gov. Haley Barbour, a potential Republican presidential contender, accused the Obama administration Wednesday of favoring a run-up in gas prices to prod consumers to buy more fuel-efficient cars.
Obama administration officials rejected the charge, saying they view rising gasoline prices as bad for average Americans and the economic recovery.
Barbour suggested that President Barack Obama wants to see higher energy taxes that would lead to more expensive gasoline. But his comments came amid a spike in gas prices that has been primarily driven by unrest in the Middle East, particularly Libya, that has diminished crude oil production. That, coupled with increased demand, has pushed prices to almost $3.39 per gallon, according to auto club AAA.
Barbour cited 2008 comments from Steven Chu, now Obama's energy secretary, that a gradual increase in gasoline taxes could coax consumers into dumping their gas-guzzlers and finding homes closer to where they work. Chu, then a Nobel Prize-winning professor, argued that higher costs per gallon could force investments in alternative fuels and spur cleaner energy sources.
"This administration's policies have been designed to drive up the cost of energy in the name of reducing pollution, in the name of making very expensive alternative fuels more economically competitive," Barbour said during a U.S. Chamber of Commerce breakfast across the street from the White House.
In 2008, while the head of the Lawrence Berkeley National Laboratory in California, Chu told The Wall Street Journal that energy prices were the lynchpin to an energy overhaul. "Somehow we have to figure out how to boost the price of gasoline to the levels in Europe," Chu said then.
White House spokesman Jay Carney said Chu made his comments before Obama assumed the presidency and has since renounced the notion that high gas prices would benefit the country.
"This administration is keenly aware of the impact of high gasoline prices on average Americans, especially in a still-recovering economy," he said.
Carney dismissed Barbour's remarks, saying they "were clearly made in the context of 2012 presidential politics."
At the Energy Department, Chu's spokeswoman offered a similar statement.
"Secretary Chu has stated repeatedly that higher gas prices are a threat to the economy and take a harmful toll on America's families," Stephanie Mueller said.
The administration has boosted fuel economy and placed the first greenhouse gas standards on vehicles in an effort to reduce the pollution blamed for global warming and to wean the country off foreign supplies of oil. Those regulations will result in less gasoline being used but should have little to no effect on gasoline prices.
Interior Secretary Ken Salazar, when asked about Barbour's comments Wednesday, said "nothing could be further from the truth."
"We are doing what we can in terms of domestic production," Salazar said. But "at end of the day ... what we can produce domestically will not have an impact in terms of the price of oil because it is set on the world market."
Another proposal initially backed by Obama would have put a price on carbon dioxide pollution, the chief gas blamed for global warming. The legislation failed in Congress last year, in part because it would have made it more expensive for industries that burn fossil fuels.
Barbour said higher energy costs already hurt workers in his state and any increase would cripple Mississippi's economy.
"In 2008, $4 gasoline brought my state to its knees before Wall Street melted down," Barbour said. "We've blown through $3 gasoline all the way to 4."
Barbour, a former lobbyist who has worked for energy companies, said Obama's energy team wouldn't be happy until gas prices reached $9 a gallon.
Gasoline prices are expected keep rising this spring, topping out between $3.50 and $3.75 per gallon.
Barbour is still weighing a presidential campaign and plans to visit Iowa twice this month. Barbour's advisers say he won't make a decision before the Mississippi legislature ends its session in early April, and it could be May before he announces his plans.
In the meantime, though, he has honed his criticism of the president, particularly on economic issues. With pocketbook issues poised to dominate the 2012 election, prospective presidential candidates are focusing their messages on Obama's stewardship of the economy and are seeking to cast his re-election as a referendum on the economy and jobs.
"We don't have a $1.5 trillion deficit this year because taxes are too low," said Barbour, a former Republican National Committee chairman who helped the Republican Governors Association make major gains in November's elections as the group's chairman. "It's because we spend too much."
Associated Press writer Matthew Daly contributed to this report.
Energy Information Administration: http://bit.ly/zVINe
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