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Local economist skeptical about president's control over gas prices

FACT FINDER:

March 06, 2012|By Kristin Bien | WSBT-TV Reporter

Gas prices are one issue on the campaign trail. Presidential candidate Newt Gingrich even said if he got into office he would be able to lower gas prices.

Can he really do that? 

Economist Lane David, a professor at IU South Bend, is skeptical. He says President Nixon tried price control and the result was huge lines, rotating days when people were allowed to get gas, and a gas shortage.

David claims gas prices are so high right now because of supply and demand. Though many would disagree, they would say speculators are a big part of the problem.

But the United States imports more than half the oil it uses. David says the only way to bring prices down is to become less dependent on the rest of the world.

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“Let the market work these issues out and let the market respond,” David said. “It may be painful for a while – I am not excited about paying $5 or $6 a gallon. But if that is what I have to pay, I am willing to pay that.”

The U.S. is producing more oil now that it used to, in places like North Dakota and Oklahoma. David told us the XL Pipeline, which has been a big political issue, wouldn't lower gas prices.

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