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Letter: Dollar’s decline may be to blame for gas prices

Tuesday, May 3, 2005 | 9:44 a.m.

High gas prices seem to remain a mystery. Economists readily forecast the financial future of our country, but not gas prices.

Now, as in the 1980s, we blame this problem on too much demand, too little supply, not enough refining capacity, bad drivers, low industry gas mileage standards, war, federal deficits, SUVs and even bad weather. This time around there is another suspect -- the value of the American dollar in world markets.

Since the Bush administration took office in 2000 our dollar has continually lost its value against every major currency in the world. Today its value against the Euro and other currencies is 25 percent less than it was when George Bush was first elected to office.

Even so, our trade deficit is off the hook. Every month we still spend tens of billions of dollars more buying more goods, including oil, from foreign countries than we sell. As a country, we spend too much and save too little. So is there a direct correlation between the devaluing of our dollar in world markets and the price we pay for oil and gas?

You be the judge. If you are a major producer of oil, how would you want to be compensated for the decline in the value of our dollar? Think about it.

RICHARD RYCHTARIK

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