Here's a challenge for How the World Works readers. See if you can find out who was the first person to use the term "boutique fuels" to describe the plethora of gasoline blends that have come into use in the United States since the enactment of the Clean Air Act of 1990.
I've been looking all morning for clues to the history of the term, inspired by President Bush's denunciation of them yesterday as one of the reasons for spiking gasoline prices. As far as I can tell, the first widely publicized reference came in President Bush's National Energy Policy Report to Congress in 2001. This leads me to suspect that the phrase originated deep in the bowels of the energy industry, where wily strategists are constantly seeking new opportunities to deride or ridicule environmental regulations.
Because, make no mistake, the use of the term "boutique" is a canny rhetorical gambit. Labeling the results of legislation aimed at combating air pollution with a French word meaning "small shop" packs the double whammy of making these gasoline blends seem not only insignificant, but also elitist. You gotta hand it to the right wing; they've been masters of this game for decades now. You could just as well call these blends "smart" or "healthy" or "clean" or "civilized" fuels -- but no, they're boutique. The term, complete with its inherent sneer, is now common parlance in government reports and academic studies.
This is not to deny that there are economic costs associated with fragmenting the national fuel market. That's indisputable. It would be a lot simpler if the feds mandated one type of gasoline for the whole country that hewed to the strictest possible standard, like, say, California's. (Or, we could go the other way, as disgraced Republican legislator Bob Ney once proposed, and require the entire nation to adopt the least stringent possible standard.)
But the drafters of the Clean Air Act tried to be fair. Some regions of the country suffer from severe air pollution, some do not. Why should Wyoming drivers be forced to buy the same fuel as New York City drivers, when they're breathing relatively clean Rocky Mountain air? There's also an issue with the kind of air pollution being targeted. Some regions produce too much carbon monoxide; some are worried about ozone. (Los Angeles, lucky city, has a problem with both.) The Clean Air Act tried to come up with a system that allowed for individual differences. But add in some local and federal efforts to promote ethanol, and you end up with a pretty confusing mess.
How much the differentiation of fuels contributes to high prices is unclear. Certainly, supply lines are tighter than ever, and in California, with its uniquely rigorous standards, any unexpected disruption in refinery production can cause an immediate price surge. But tight supply lines have much more to do with massive consolidation in the refinery industry, and the ensuing contraction of production capacity, than with any environmental mandates. Refineries learned long ago that it was to their advantage to avoid producing a glut of gasoline that would lead inevitably to lower prices.
Figuring out a fair and sensible solution to supply problems in the gasoline market that achieves environmental goals and doesn't impose undue burdens on working Americans is not an easy task. But it doesn't help that it is impossible to trust that our current president actually wants to do what is sensible, instead of being primarily interested in pursuing policies that increase profit margins for his campaign financiers. The evidence for this perversion of governmental responsibility is overwhelming, but you really don't have to dig any further than the use of the term "boutique" to get a sniff of the stink.