Bachmann: As President, I'll bring back Great Recession

[Mr. Big Dog 10,747]

Bachmann: I'll bring back $2 gas

NEW YORK (CNNMoney) -- President Michele Bachmann has a promise: $2 gas.

"Under President Bachmann you will see gasoline come down below $2 a gallon again," Bachmann told a crowd Tuesday in South Carolina. "That will happen."

Print Sure, politicians promise all kinds of things on the campaign trail. But Bachmann, a leading contender for the 2012 Republican nomination, is wading into truly tricky territory.

The price Americans pay at the pump is tied to the crude oil market -- a global system largely beyond the reach of Washington.

It's certainly true that prices -- now about $3.50 a gallon on average -- have risen since President Obama took office.

"The day that the president became president gasoline was $1.79 a gallon," Bachmann said. "Look what it is today."

Of course, that's not the full story.

When Obama took office, the country was mired in a terrible economic contraction.

"That was in the 4th inning of the greatest recession of our lifetime," said Tom Kloza, chief oil analyst at the Oil Price Information Service.

During recessions, demand for gasoline plummets as trucks pull off the road, companies cut back on travel and laid off workers drive fewer miles.

Obama's desperate SPR oil play

"You have to be careful what you wish for because the recipe for cheap prices these days is economic disaster," Kloza said.

Since early 2009, the economy has recovered somewhat and demand for crude has risen. It has even spiked in the developing world -- especially in China, India and South America.

Kloza said that increased crude demand is the principal driver behind higher gas prices.

"We're going to have to recognize the rest of the world has this increasing appetite for oil," he said. "If we go below $2 a gallon, it probably means there has been a lot of wealth loss and we are in a deflationary period."

There are some measures that could be taken to lower gas prices, according to Phil Flynn, a senior market analyst at PFG Best.

A stronger dollar would take pressure off prices, and reducing the number of miles Americans drive in gasoline-powered cars would also weaken demand.

"I never say never," Flynn said. "But whether or not Bachmann can do that in four years is a tall order."

Bachmann did not lay out a specific plan to drop prices on Tuesday. But her campaign website says that as president, she would ease restrictions on drilling and roll back federal regulations on the shale gas industry.

While increased oil and gas drilling in the United States may create good-paying jobs, reduce reliance on foreign oil and lower the trade deficit, it would have little impact on gas and oil prices.

Drill baby drill won't lower gas prices

That's because the amount of extra oil that could be produced from more drilling in this country is tiny compared to what the country -- and the world -- consumes.

Plus, any extra oil the United States did produce would likely be quickly offset by a cut in OPEC production.

According to a 2009 study from the government's Energy Information Administration, opening up to drilling areas off the East Coast, West Coast and the west coast of Florida would yield an extra 500,000 barrels a day by 2030.

The world currently consumes 89 million barrels a day, and by then would likely be using over 100 million barrels.

After OPEC got done adjusting its production to reflect the increased American output, gas prices might drop a whopping three cents a gallon, the study said.

[patient2010 93]

thanks for sharing

[sly_wolf 199]

And many will actually believe her!

[Trumplestiltskin 5,791]

No way will that happen

[Mr. Big Dog 10,747]

No way will that happen

What will not happen? President Bachmann, $2.00 gas or another Great Recession?

[Trumplestiltskin 5,791]

What will not happen? President Bachmann, $2.00 gas or another Great Recession?

$2.00 gas. Bachmann won't win either if she promises something like that.

[nane1104 146]

I'd HOPE people are smart enough to not believe such ridiculous promises but you never know. In economically bad times like this, people just love to hear "it's all gonna be better", reasonable or not.

[Obama 2012 1,714]

increased inventories helps a little with the price of gas.

Honestly, demand doesn't play much of a factor at all. Oil is treated more like an investment safety net these days, which is a good portion of the time tied to the US Dollar Index.... Index goes up, oil prices go down... Index goes down, oil prices go up.

You want oil prices to go down? It's not about a recession at this point, it's about doing things that increase the value of the dollar and get people to invest into it.

As Rick Perry even said though, if the Fed prints more money, it's almost treasonous because that guarantees a drop in the value of the dollar and for people to invest into oil more and more. Cause and effect, higher oil prices = higher gas prices. A tax on the poor especially.

[slim 1,533]

If she cut welfare, housing, education, etc., it would be very easy to subsidize gas.

Think about it - the government has been GIVING away $8,000 to anyone who bought a house. Why couldn't they give everyone $8,000 worth of free gas? I mean, if we're making stuff up to waste money on, why not waste it on gas too!

The president can do whatever they want nowadays. If the pres says $2.00 gas, then by golly, we'll get $2.00 gas.

Now there's some hope and change I can believe in!