[Congressional Record Volume 152, Number 51 (Wednesday, May 3, 2006)]
[House]
[Pages H1993-H1999]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
FEDERAL ENERGY PRICE PROTECTION ACT OF 2006
Mr. BARTON of Texas. Mr. Speaker, I move to suspend the rules and
pass the bill (H.R. 5253) to prohibit price gouging in the sale of
gasoline, diesel fuel, crude oil, and home heating oil, and for other
purposes.
The Clerk read as follows:
H.R. 5253
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Federal Energy Price
Protection Act of 2006''.
SEC. 2. GASOLINE PRICE GOUGING PROHIBITED.
(a) Unlawful Conduct.--
(1) Unfair and deceptive act or practice.--It shall be an
unfair or deceptive act or practice in violation of section 5
of the Federal Trade Commission Act for any person to sell
crude oil, gasoline, diesel fuel, home heating oil, or any
biofuel at a price that constitutes price gouging as defined
by rule pursuant to subsection (b).
(2) Definition.--For purposes of this subsection, the term
``biofuel'' means any fuel containing any organic matter that
is available on a renewable or recurring basis, including
agricultural crops and trees, wood and wood wastes and
residues, plants (including aquatic plants), grasses,
residues, fibers, and animal wastes, municipal wastes, and
other waste materials.
(b) Price Gouging.--
(1) In general.--Not later than 6 months after the date of
the enactment of this Act, the Federal Trade Commission shall
promulgate, in accordance with section 553 of title 5, United
States Code, any rules necessary for the enforcement of this
section.
(2) Contents.--Such rules--
(A) shall define ``price gouging'', ``retail sale'', and
``wholesale sale'' for purposes of this Act; and
(B) shall be consistent with the requirements for declaring
unfair acts or practices in section 5(n) of the Federal Trade
Commission Act (15 U.S.C. 45(n)).
[[Page H1994]]
(c) Enforcement.--
(1) In general.--Except as provided in subsection (d), a
violation of subsection (a) shall be treated as a violation
of a rule defining an unfair or deceptive act or practice
prescribed under section 18(a)(1)(B) of the Federal Trade
Commission Act (15 U.S.C. 57a(a)(1)(B)). The Federal Trade
Commission shall enforce this Act in the same manner, by the
same means, and with the same jurisdiction as though all
applicable terms and provisions of the Federal Trade
Commission Act were incorporated into and made a part of this
Act.
(2) Exclusive enforcement.--Notwithstanding any other
provision of law, no person, State, or political subdivision
of a State, other than the Federal Trade Commission or the
Attorney General of the United States to the extent provided
for in section 5 of the Federal Trade Commission Act or the
attorney general of a State as provided by subsection (d),
shall have any authority to enforce this Act or any rule
prescribed pursuant to this Act.
(d) Enforcement by State Attorneys General.--
(1) Civil action.--In any case in which the attorney
general of a State has reason to believe that an interest of
the residents of that State has been or is threatened or
adversely affected by any person who violates subsection (a),
the attorney general, as parens patriae, may bring a civil
action on behalf of the residents of the State in a district
court of the United States of appropriate jurisdiction--
(A) to enjoin further violation of such section by the
defendant;
(B) to compel compliance with such section; or
(C) to impose a civil penalty under subsection (e).
(2) Intervention by the ftc.--
(A) Notice and intervention.--The State shall provide prior
written notice of any action under paragraph (1) to the
Federal Trade Commission and provide the Commission with a
copy of its complaint, except in any case in which such prior
notice is not feasible, in which case the State shall serve
such notice immediately upon instituting such action. The
Commission shall have the right--
(i) to intervene in the action;
(ii) upon so intervening, to be heard on all matters
arising therein; and
(iii) to file petitions for appeal.
(B) Limitation on state action while federal action is
pending.--If the Commission has instituted a civil action for
violation of this Act, no attorney general of a State may
bring an action under this subsection during the pendency of
that action against any defendant named in the complaint of
the Commission for any violation of this Act alleged in the
complaint.
(3) Construction with respect to powers conferred by state
law.--For purposes of bringing any civil action under
paragraph (1), nothing in this Act shall be construed to
prevent an attorney general of a State from exercising the
powers conferred on the attorney general by the laws of that
State.
(e) Civil Penalty.--
(1) In general.--Notwithstanding any civil penalty that
otherwise applies to a violation of a rule referred to in
subsection (c)(1), any person who violates subsection (a)
shall be liable for a civil penalty under this subsection.
(2) Amount.--The amount of a civil penalty under this
subsection shall be an amount equal to--
(A) in the case of a wholesale sale in violation of
subsection (a), the sum of--
(i) 3 times the difference between--
(I) the total amount charged in the wholesale sale; and
(II) the total amount that would be charged in such a
wholesale sale made at the wholesale fair market price; plus
(ii) an amount not to exceed $3,000,000 per day of a
continuing violation; or
(B) in the case of a retail sale in violation of subsection
(a), 3 times the difference between--
(i) the total amount charged in the sale; and
(ii) the total amount that would be charged in such a sale
at the fair market price for such a sale.
(3) Deposit.--Of the amount of any civil penalty imposed
under this section with respect to any sale in violation of
subsection (a) to a person that resides in a State, the
portion of such amount that is determined under subparagraph
(A)(i) or (B) (or both) of paragraph (2) shall be deposited
into--
(A) any account or fund established under the laws of the
State and used for paying compensation to consumers for
violations of State consumer protection laws; or
(B) in the case of a State for which no such account or
fund is establish by State law, into the general fund of the
State treasury.
(f) Criminal Penalty.--
(1) In general.--In addition to any other penalty that
applies, a violation of subsection (a) is punishable--
(A) in the case of a wholesale sale in violation of
subsection (a), by a fine of not more than $150,000,000,
imprisonment for not more than 2 years, or both; or
(B) in the case of a retail sale in violation of subsection
(a), by a fine of not more than $2,000,000, imprisonment for
not more than 2 years, or both.
(2) Enforcement.--The criminal penalty provided by
paragraph (1) may be imposed only pursuant to a criminal
action brought by the Attorney General or other officer of
the Department of Justice, or any attorney specially
appointed by the Attorney General, in accordance with section
515 of title 28, United States Code.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Texas (Mr. Barton) and the gentleman from Michigan (Mr. Stupak) each
will control 20 minutes.
The Chair recognizes the gentleman from Texas.
General Leave
Mr. BARTON of Texas. Mr. Speaker, I ask unanimous consent that all
Members may have 5 legislative days within which to revise and extend
their remarks on this legislation, and to insert extraneous material on
the bill.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Texas?
There was no objection.
Mr. BARTON of Texas. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, Americans are again seeing spikes at the gas pumps, with
prices reaching over $3 a gallon all over the country. This morning, I
went by the 7-Eleven at Second and Glebe Road in Arlington, Virginia,
and there were no prices posted on the sign outside the station. I
thought, oh, maybe they are giving gasoline away. No, they did not have
any gasoline to sell at any price.
We need to do something, not only to bring these prices down, but we
need to do something to make sure that there is adequate gasoline
supply available at every service station in the country that serves
the American driving public.
$3 a gallon gasoline may mean nothing to some people, but it sure
means a lot to most of us and everything to the poorest of our society
that really have to have gasoline to get back and forth to work and it
is a big part of their budget.
Soaring gasoline prices drain the budgets of the working families who
rely on cars to get their kids to school and themselves to work. If the
spike in gasoline prices are due to anything other than market
conditions, consumers have a right to count on us, the government, for
protection from these rip-offs.
H.R. 5253, sponsored by Congressman Wilson of New Mexico, the bill
that we are considering right now, prohibits price gouging in the sale
of gasoline, diesel fuel, crude oil, and home heating oil.
While price fixing, collusion and other anti-competitive practices
are currently illegal, there is no Federal statutory prohibition on the
books against price gouging. Nobody has really defined at the Federal
level exactly what it is yet.
It is true that we all think we know what price gouging is when we
see it, but that is not the sort of definition that a prosecutor can
take to a judge or a jury. We are not here today saying something is
just awful and somebody ought to stop it. We are here to put the
gougers out of business, if there are gougers, and behind bars.
Last October, the House passed anti-price gouging provisions in the
Gas Act. Like the provision in that act, the Gas Act, the legislation
before us today provides an explicit Federal prohibition on gasoline
price gouging, treating it as an unfair trade practice under the
Federal Trade Commission Act.
It would also provide for additional enforcement in that it gives the
United States Attorney General, the Federal Trade Commission, the
States attorney generals, the authority to enforce against price
gouging at any time, not just in times of a major disaster. It provides
for greater civil penalties and even criminal penalties in some cases
for the most serious offenses.
The legislation would ensure that the definition of price gouging
promulgated by the FTC rule-making does not cover spikes in gas prices
that are caused by market conditions.
Committee hearings have demonstrated that when artificial regulations
supplant normal supply and demand as the primary means of pricing a
commodity, the result is market distortion and shortages. Ask those of
us who were lining up for gas in the mid- and late 1970s.
We are also not here today in pursuit of consequences, unintended or
otherwise, that makes it tough for people to get to work and to school.
Price spikes
[[Page H1995]]
are a scourge, but dry pumps are a catastrophe. As I mentioned this
morning, at Second and Glebe Road in Arlington, Virginia, there was no
gas at any price at the 7-Eleven.
I know the difference, and I will strenuously oppose any policies
that choke off the flow of gasoline to drivers. We want to have
effective enforcement against scams without interfering with the
efficient functioning of the market.
In my opinion, H.R. 5253 does that. I would urge my colleagues to
support this important piece of consumer protection legislation.
Mr. Speaker, I reserve the balance of my time.
Mr. STUPAK. Mr. Speaker, today we are considering legislation that
would give the Federal Trade Commission the authority to investigate
and prosecute price gouging in gasoline. This bill, H.R. 5253, was
introduced just yesterday.
For 8 months, Democrats have been calling for the Republican
leadership to allow a vote on my price gouging legislation, the Federal
Response to Energy Emergencies, the FREE Act.
129 Democrats have signed a discharge petition to request that my
price gouging legislation be brought to the floor for a vote. They say
imitation is the sincerest form of flattery. Well, after 8 months of
Democrats demanding that the Republican leadership bring legislation to
the floor to protect the American consumers from price gouging, the
Republicans have finally proposed their own bill.
While I am pleased that we have finally convinced the Republicans to
bring legislation on price gouging to the floor, it is the American
people who should be the winners today.
This legislation is long overdue. In the past 8 months the
Republicans have failed to act to address price gouging, gas prices
have exceeded $3 a gallon. Crude oil prices have broken records.
Americans have endured significant financial hardships, and oil
companies have reaped record profits.
Let us be clear. Republicans claim to have passed a price gouging
bill last October. However, that legislation was so toothless that it
is being ignored by the Republicans in the other body.
During that debate, I offered the FREE Act amendment as a substitute.
All but two Republicans voted against my legislation. While I am
pleased that the Republican leadership has finally brought a gas bill
to the floor, I will say that this new bill was immediately put on the
suspension calendar without any hearings, without any meaningful
debate.
Several of my colleagues may not appreciate the differences between
the bill before us today and the Democratic legislation, the FREE Act.
Although these differences should not delay price gouging legislation
any longer than it already has been, it is my hope that the Republicans
will be willing to address these issues of true price gouging as this
piece of legislation moves forward.
Our bill, the FREE Act, would specifically set out guidelines for the
FTC to use to define price gouging, including provisions that make
unconscionable pricing, providing false pricing information, and market
manipulation illegal, all of which is lacking in the bill before us
today.
The FREE Act also contains a provision that would promote price
transparency, providing consumers with the information to know that oil
and gas prices are fair and reasonable, again a standard lacking in the
legislation before us today.
The FREE Act would also apply to natural gas and propane. Neither
natural gas nor propane are even mentioned in the bill before us today.
Had the Republican bill, H.R. 5253, the bill before us today, been
considered even by any committee in this Congress, or even just allowed
to be amended on the floor here today, we could make changes that would
make this a better bill.
Nonetheless, Congress has a responsibility to pass a price gouging
bill. I am pleased the Republicans have stopped stonewalling. Democrats
will continue to put pressure on the Republican leadership until a
real, true price gouging bill is enacted, to ensure that it contains
the strongest provisions to protect the American consumer.
It has taken 8 months for Democrats to finally shame the Republican
leadership into passing price gouging legislation. If the Republicans
are serious about helping American people, several of my Democratic
colleagues have proposals to help ease the pain at the pump. It is my
hope that it will not take 8 months for the Republicans to consider
these proposals as we continue to work on the issue of high gas prices.
{time} 1130
Mr. Speaker, I reserve the balance of my time.
Mr. BARTON of Texas. Mr. Speaker, I ask unanimous consent that the
gentlewoman from Albuquerque, New Mexico (Mrs. Wilson) manage the
remainder of the majority time on the bill.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Texas?
There was no objection.
Mrs. WILSON of New Mexico. Mr. Speaker, I yield myself such time as I
may consume.
My colleague from Michigan talks about the need to move quickly, and
the truth is, I introduced a price-gouging bill in September of last
year in the wake of Katrina. It was a bipartisan bill with the
gentleman from Ohio (Mr. Brown) as the lead cosponsor.
In October, we passed price-gouging legislation combined with the
refinery bill in what is called the Gas Act, and it is true my
colleague from Michigan did propose an alternative which I opposed
because I felt as though the definitions in his bill were unclear and
would invite litigation rather than solutions.
We are trying to move forward with a piece of legislation that will
give real authority to the Federal Trade Commission that they do not
currently have now. Twenty-three States have laws on price gouging. So
we have got about close to half the States in the Nation have some form
of law in price gouging, all with various provisions, definitions and
so forth, but the Federal Trade Commission that is empowered at the
Federal level with being the agency responsible for looking at
consumers and consumer protection only has authority to look at
gasoline and oil with respect to collusion. If there is collusion
between two companies on setting the price of gasoline, then they have
the authority to investigate, but they have no authority to investigate
when it comes to unreasonable and unfair trade practices. This
legislation we are offering today would give them that new authority at
the Federal level.
I think this is a good piece of legislation, and I would ask my
colleagues to support it.
H.R. 5253 would prohibit price gouging at any time. It is not limited
to emergencies or in the wake of natural disasters. I will be very
honest; the thing that caused me to introduce price-gouging legislation
last September was what we all saw in the wake of Katrina: opportunists
taking advantage of a terrible situation and a natural disaster to pump
up the price of gasoline for people who were trying to flee for their
lives. That is not right, and it is what spurred me to introduce the
price-gouging legislation.
The modification in the bill that is before us today is that the
price-gouging authority for the Federal Trade Commission would not
require a disasters trigger, but they could look at unfair trade
practices at any time, not limited to emergencies. It also covers
gasoline, diesel, crude oil, home heating oil and biofuels. So it goes
across a wide variety of full types.
It also sets pretty stiff criminal and civil penalties for price
gouging and allows these investigations by the Federal Trade Commission
as well as by the States.
Under these provisions, the Federal Trade Commission would consider
public comment in defining exactly what wholesale pricing is, what
retail pricing is, and it gives them some regulatory authority to come
up with definitions. The truth is, we have got 23 State laws. Some of
those laws are very, very different, and I think it makes some sense to
allow the States and those involved to come up with a national
definition that will work best for consumers in the marketplace.
The legislation we are offering today would not, however, preempt
those State laws. So the States would still be able to use their State
laws to address problems with price gouging in their
[[Page H1996]]
own jurisdictions. This would give additional authority to the Federal
Trade Commission and to States that choose to use the Federal law to
investigate price gouging in their own States.
It seems to me that this is one thing that we have to do. We have
done it first in a larger bill, as a piece of a larger bill last
October, but I think the approach we are trying to take here in the
House of Representatives is to say we want America to be more energy
independent, and that is going to take a long-term, balanced approach
that deals with supply, demand and protecting consumers.
This is one piece of that puzzle. We will be dealing with other
pieces of that puzzle as we move along, everything from coal-to-oil
gasification, encouraging more hydrogen-powered cars, encouraging more
E85, using ethanol in our gas tanks, so both conservation and
increasing domestic supply so that America becomes more energy
independent.
I encourage my colleagues to support this proposal.
Mr. Speaker, I reserve the balance of my time.
Mr. STUPAK. Mr. Speaker, I yield 2 minutes to the gentleman from New
York (Mr. Higgins) who has been a real advocate on lowering some of
these special tax privileges for the big oil and gas companies.
Mr. HIGGINS. Mr. Speaker, I want to thank my colleague from Michigan
(Mr. Stupak), who has been a real leader on this issue, and all of the
members of the Democratic Caucus who have weighed in aggressively and
substantially on this issue.
The fact of the matter is the President last week has suggested that
the State attorneys general be more aggressive about enforcing anti-
price-fixing or gas-gouging laws. The States and the people of America
are looking for the Federal Government to provide leadership on this
issue.
The fact of the matter is that high gas prices are a result of an
energy policy that is disastrous. It does not do anything to promote
alternative energy fuel sources. It does nothing to promote
conservation, and it gives huge, huge incentives to the oil companies
to continue to manipulate prices to the American citizens.
This anti-price-gouging legislation is important, but it is late. We
have to learn not to react to a crisis but to influence conditions to
avert a crisis. The American people are looking for leadership. This is
one step, albeit a small step, toward achieving that, but we have to
promote more aggressively, more effectively, policies that are
substantial toward dealing with the fundamental problems here.
In the other House, there was a suggestion of a $100 tax rebate to
folks in this country, which would have required $10 billion of
additional borrowing, and basically subsidizing consumption, which does
nothing to address the fundamental issues.
So I thank the gentleman for the time.
Mrs. WILSON of New Mexico. Mr. Speaker, I yield 1 minute to the
gentleman from New York (Mr. Boehlert).
(Mr. BOEHLERT asked and was given permission to revise and extend his
remarks.)
Mr. BOEHLERT. Mr. Speaker, I rise in support of this measure, and I
want to particularly thank the Energy and Commerce Committee,
especially Mrs. Wilson, for the leadership she has provided on this
important issue, and for the helpful suggestions and work by Mr. Castle
and Mrs. Johnson of Connecticut and Mr. Kirk and their staffs. They
helped put all this package together under the leadership of Mrs.
Wilson.
This bill is far stronger than the price-gouging language the House
considered last fall and could offer Americans true protection if price
gouging is occurring. The bill will allow new suits under Federal law
against retail and wholesale price gouging, and those suits can be
brought by either the Federal Government or a State attorney general.
The penalties in the bill are significant, as they should be, and the
bill allows criminal as well as civil penalties.
Finally, the bill would distribute the money from suits back to those
who were harmed through State victim compensation funds.
So I think we have taken into consideration every criticism that was
leveled last fall, and it has been addressed forthrightly. American
consumers are demanding protection from price gouging. The President
has echoed that call, and now Congress is heeding it. I urge adoption
of the bill.
Mr. STUPAK. Mr. Speaker, I yield 2 minutes to the gentlewoman from
Illinois (Ms. Schakowsky), an advocate of consumers before she got to
Congress, and she continues in that present capacity today as a strong
advocate for consumers.
Ms. SCHAKOWSKY. Mr. Speaker, I want to thank the gentleman from
Michigan for his great leadership to try and help consumers to bring
the price of gasoline down.
Mr. Speaker, gasoline prices have doubled since the Bush
administration took office. On Sunday, Secretary Bodman declared there
was an energy crisis in this country, and the Republicans are
scrambling to play catch- up.
Since last September, Speaker Hastert has blocked action on
Congressman Stupak's bill, which would impose tough criminal penalties
on oil and gas companies that engage in price gouging. Congressional
Republicans have consistently voted down efforts to give the FTC new
authority to prosecute companies that price gouge. Instead, Republicans
passed an energy bill which the Energy Information Administration said
would raise gasoline prices, and it has.
Last Tuesday, President Bush called on his administration to
investigate possible price gouging, even though the FTC was completing
a report on price gouging that Congress requested last year. Then, on
Friday, the President said, ``I have no evidence that there's any rip-
off taking place.'' Think back to the investigation.
Is it any wonder, Mr. President, that Americans are skeptical that
you are serious about investigating your Big Oil buddies? On Friday you
said, ``It's the role of the FTC to assure me that my inclinations and
instincts are right.''
Was that an order for a rubber stamp, Mr. President? No wonder the
American people are a bit skeptical, Mr. President, that your oil-
dominated administration will work to protect them or, once again, to
protect the oil and gas companies, but we need to begin with a serious
investigation of those oil companies. I hope that you are really
serious.
Mrs. WILSON of New Mexico. Mr. Speaker, I yield 2 minutes to the
gentleman from New Hampshire (Mr. Bass).
Mr. BASS. Mr. Speaker, I thank the gentlewoman from New Mexico for
recognizing me. I also thank her for her leadership in sponsoring this
very important piece of legislation, and it would be a bright day in
America and in this Congress if we could spend a minute or two working
on issues that will increase supplies, assure honesty in the energy
world in a difficult period of time and do so with a focus on policy
and good sound legislation, rather than trying to make political
points, speech after speech after speech.
What we have here before us today is a good piece of legislation, and
it does four critical things. First, it directs the Federal Trade
Commission to define price gouging, to define what wholesale sales are
and what retail sales are and to come up with rules that will implement
those definitions.
It also provides for strong civil enforcement by the Federal Trade
Commission and the State attorneys general for criminal enforcement.
It provides strong civil penalties. Those penalties would be three
times the ill-gotten gains for the retailer, plus an amount not to
exceed $3 million per day for continuing violations.
It also provides for strong criminal penalties, and these penalties
are $150 million and/or imprisonment for not more than 2 years, and on
the retail side, $2 million and imprisonment not more than 2 years.
These are real penalties, and this will, with the proper rulemaking
process, lead to a deterrent that will result, in my opinion, in energy
prices reflecting true costs.
It is important to emphasize that this legislation does not upset
State laws. It is enforceable by State attorneys general and, as I said
a minute ago, does provide vigorous civil and criminal penalties.
There is no excuse for price gouging in energy, and with the passage
of this
[[Page H1997]]
legislation, that will be more fully assured.
I want to thank my friend from New Mexico for her leadership in this
area. I urge my colleagues to support this legislation.
Mr. STUPAK. Mr. Speaker, I yield 2 minutes to the gentleman from
Florida (Mr. Davis) who is a member of the Energy and Commerce
Committee and has been advocating to try to get energy prices under
control from refinery to gasoline.
Mr. DAVIS of Florida. Mr. Speaker, for years, many Members of this
Congress have pushed for exactly this type of measure to be adopted
today that would give the Federal Trade Commission, the FTC, the
authority it needs to investigate price gouging.
We are living in a time in my home State of Florida and every State
with record profits and record prices, and I think the only people in
the United States of America who think there is nothing wrong with
these prices are the executives of these oil companies.
The only good thing that has come out of the price that we are all
having to pay at the pump, it has finally forced this Congress to take
a necessary first step. I commend Congresswoman Wilson. This bill is
meaningful. It is a good first step in setting significant fines and
penalties if, in fact, there is truly an investigation and enforcement
or even the threat of enforcement. This bill will give the FTC the
authority to define what price gouging is and then to take action.
{time} 1145
The strong arm of the Federal Government is necessary to act. This is
too much power in the hands of a few companies for a single State to
act against.
As Congresswoman Schakowsky pointed out, the unfortunate gratuitous
remarks by the President that he does not think there is price gouging
undermines our actions today. I do not know what it feels like to him
and others, but it sure feels like price gouging to me when I fill up
my car, and I think I can say that on behalf of the Floridians that I
represent.
So this is only a first step. If this administration is not truly
serious about investigating and letting these companies know there is a
meaningful risk of enforcement and fines and penalties, this Congress
should take further action, and we should not wait until prices go up
further and profits go up further.
I would also say now is the time for the leadership in this Congress
to bring up the CAFE standards as well. There are other steps we can be
taking to raise fuel efficiency standards and to reduce interdependency
on other countries. So I salute Congresswoman Wilson on this bill, but
this has to be the first step of many in this Congress if we are truly
serious as Democrats and Republicans at cracking down on price gouging.
Mrs. WILSON of New Mexico. Mr. Speaker, I thank my colleague for his
kind remarks. I would yield 3 minutes to the Subcommittee on Consumer
Protection Chair from the Energy and Commerce Committee, the gentleman
from Florida (Mr. Stearns).
(Mr. STEARNS asked and was given permission to revise and extend his
remarks.)
Mr. STEARNS. Mr. Speaker, as I think most of us know after listening
to this debate, the fuel prices around this country have been rising.
Beginning with the summer driving season, I think particularly in
Florida where we have so many tourists, we are concerned about it, and
of course we know that during the time of growing economies, and China
and India are consuming more and more of the world's available
petroleum supplies, that puts us competitive here in the United States.
To make matters worse, nuclear ambitions in Iran, the fourth largest
producer of oil, intentions in Nigeria, the 12th, have created what
would be perceived to be a perfect storm, which is a precipitous rise
in gasoline and other fuel prices.
Our problem back home now is how to manage those global issues so
that they will have as little impact at home on the average working
American who just wants to take his family on that planned vacation to
Florida, let us hope, under a tight budget or maintain his delivery
business without taking out additional loans just to fill up his car. I
am happy that my colleague, Mrs. Wilson, is taking up this bill, H.R.
5253, the Federal Energy Price Protection Act of 2006. I commend her
leadership for this.
I believe this bill deals directly and aggressively with the need to
stabilize the price of fuel in an uncertain world market and ensure
that greed and opportunism does not worsen those challenges by gouging
the consumer at the pump. This bill for the first time allows the
Federal Trade Commission, which I have jurisdiction over as chairman of
the Commerce, Trade and Consumer Protection Subcommittee, at any time,
my colleagues, to prosecute price gouging. This bill takes aim at those
in the wholesale and retail markets for gasoline, diesel fuel, crude
oil, home heating oil and biofuels who prey on their consumers for
their own unjust enrichment.
The FTC is directed to define what price gouging actually is. We have
had them in a hearing, and they have described it, but it is not a
precise definition. Let us get a precise definition. And a very
important point: This legal recourse and its enforcement provisions
against gouging are always available, not just in times of natural or
energy emergencies like we had in Katrina.
Mr. Speaker, this bill's hammer is triggered by consumer rip-offs,
not just bureaucratic proclamations. In addition, State Attorney
Generals will be empowered to bring cases under the Federal law, and
those cases can lead to extremely strong civil and criminal penalties
and to multi-millions of dollars, and the possibility of a visit to the
nearest correctional facility.
This is a very aggressive piece of legislation targeted at a problem
that weakens this country not only in dollars but what it does to the
everyday life of an American, vacations missed, budgets broken and
businesses stretched thin.
Mr. Speaker, I urge my colleagues to pass H.R. 5253 and once and for
all make it clear that we in Congress are serious about solving our
energy challenges at home so that we can be more successful in solving
them abroad. This bill will serve us and our children well.
Mr. STUPAK. Mr. Speaker, I yield 2 minutes to the gentleman from Ohio
(Mr. Kucinich), who is always down here every day advocating for the
American people.
Mr. KUCINICH. Mr. Speaker, this bill is called the Federal Energy
Price Protection Act of 2006 because the bill will protect today's
excessive gasoline prices from government intervention. This bill will
prevent our government from actually doing anything to reduce the price
of gasoline.
To reduce the price of gasoline, one must understand the underlying
causes of excessive costs. Consider the fact that it costs only $20 a
barrel to extract oil out of the ground today, but oil companies are
making $72 a barrel. At the same time, the crude oil reserves already
pumped out and in storage are at all-time highs. Therefore, crude is
not constrained, and the excessive price for a barrel of oil is not
based on a free market. The crude oil price is being manipulated with
much speculation that recent increase in the oils futures market had
played a significant role. The recent increase in profits in the
refinery business correlate with the industry effort to shut down to
independent refineries to constrict supply. These two factors account
for 99 percent of the excessive profits.
Now, the FTC has approved the oil companies' monopolies, and they set
the stage for the increased prices. This same FTC is going to define
price gouging, as if they don't know what it already is? I suspect,
under the FTC, the excessive profits are unlikely to be illegal unless
the FTC can show manipulations occurred. Since manipulation is well
disguised by the industry, the FTC will be easily able to brush aside
excessive profits as nothing more than a market signal. Any definition
drafted by the current FTC will also likely establish that the price of
crude oil set by the world market and therefore any profits relative to
that price are not price gouging. This bill will enable the Federal
Government to cut off aggressive State actions by intervening and then
settling with minimum penalties.
Mr. Speaker, the American people want something done now. We need a
windfall profits tax, 100 percent on windfall profits. That will give
the oil companies a signal that they won't forget.
[[Page H1998]]
Mrs. WILSON of New Mexico. Mr. Speaker, I reserve our time, and I
believe I also have the right to close.
Mr. STUPAK. Mr. Speaker, may I inquire how much time we have
remaining.
The SPEAKER pro tempore. The gentleman from Michigan has 8 minutes.
Mr. STUPAK. Mr. Speaker, I have no other requests for time, so let me
say a few words, and then will yield back.
Mr. Speaker, the American people are quite fed up with the price
gouging that is going on at the gasoline pump. They know gouging when
they see it, and they are being gouged. The Federal Government has the
responsibility to protect consumers from price gouging.
Congress needs to pass legislation to allow the Federal Trade
Commission to prosecute price gouging. While the bill before us is not
perfect, I am pleased that the Republicans have finally realized that
price gouging is a serious issue and it is an issue that needs to be
addressed. Our constituents are looking to Congress for relief. It is
our duty to approve legislation that would provide relief to protect
Americans from the increased financial hardship from gasoline price
gouging rates that is currently taking place.
Mr. Speaker, just as Republicans have finally joined with us
Democrats in addressing price gouging, I challenge the Republicans, I
challenge the chairman of our Energy and Commerce Committee to take up
other proposals we have, Mr. Markey's proposal, a member of the Energy
and Commerce Committee, to reduce the royalties. Oil companies get to
drill on Federal lands; they do not have to pay any royalties. With
record profits, they should be paying increased royalties to the
American people. Or Mr. Higgins who spoke earlier today about his piece
of legislation that takes away the tax break from the oil companies
that have record profits last year of $113 billion, or in its first
quarter of this year, it is approximately $20 billion, in the first
quarter, in the first 90 days, $20 billion in profits. Why do they need
tax breaks? Even the President said, as we were debating the Energy
Policy Act of 2005 last year, that when oil is over $40 a barrel, there
is no need for tax breaks. But yet we continue to give tax breaks to
the oil companies. So there are other proposals. Or even the proposal I
have before this committee that Mr. Kucinich spoke of, the Pump Act, to
prevent unfair manipulating of prices. We know that if this Congress
were to act, we could immediately bring down the price of a barrel of
oil by $20 if we take the speculation, the fear and greed out of the
oil futures market.
Mr. Speaker, of the billions of dollars of oil that is traded in
futures market, 75 percent is not regulated. A mere 25 percent is
regulated by NYMEX, New York Mercantile Exchange. The other 75 percent
is unregulated. Therefore, they use fear; they use speculation to drive
up that price.
So we have legislation that would actually reduce that, and let all
those who trade in the futures market when we deal with oil to bring
their transactions, to bring some transparency and bring it before the
Commodities Futures Trading Commission to reduce that price of oil by
$20 per barrel.
Mr. Speaker, as a Member of this House, I would urge my colleagues to
vote ``yes'' on this legislation. It is an initial start. We can
improve on it. And as this process goes through, even though we were
denied hearings, even an opportunity to amend this legislation; in
fact, most Members have never seen it before. It was only introduced
yesterday. We would hope that as this bill moves through the entire
legislative process, that the other body would at least include all
energy products, like natural gas which is not included in this bill,
propane which is not included in this bill. What about the market
manipulation, predatory pricing, regional price differences, all the
things that we know happen in this country but yet we do not address in
this bill? Like I said, it is an initial good start. We are glad to see
the Republican leadership finally acknowledge there is price gouging,
but rest assured, the Democrats will continue to come up with bold new
ideas on how to get our hands on this energy crisis we are dealing with
and the skyrocketing high gasoline prices. The American people are fed
up. They have a right to be. This is a good first start. I urge my
colleagues to vote for this legislation.
Mr. Speaker, I yield back the balance of our time.
Mrs. WILSON of New Mexico. Mr. Speaker, I thank my colleague from
Michigan for his support of this legislation. I introduced a bipartisan
bill in September of 2005 about the same time that my colleague from
Michigan did. Our approaches are different in some respects, but this
legislation we are voting on today, a slightly different version of
which was included in the October 2005 Gas Act that the House has
already passed, is a good bill. It is a solid piece of legislation and
deserves the support of the House.
I also recognize that this is only one piece of the puzzle. We want
to give the Federal Trade Commission the authority to investigate
possible price gouging. But that is not going to solve all of our
energy problems. This focuses on one piece of the problem. The bill
that we will consider next on the floor of the House will also look at
another piece of the problem, and we are going to try to pass some
further legislation that deals with tax codes, that increases domestic
supply, that invests in alternative sources, things like E-85.
Since we passed the Energy Act in August and the chairman of the
Energy and Commerce Committee came out to New Mexico to sign that
landmark piece of legislation, there are 29 new ethanol plants that
have requested permits so that we can use corn to fuel our vehicles
rather than having to import oil from other countries.
Mr. Speaker, this bill includes strong penalties, in fact stronger
than the ones that my colleague from Michigan has in his bill. I think
maybe if we would have worked together, we could have come up with a
good bill that both of our names were on. It gives us good clear
definitions and says, we have got 23 States that have price-gouging
laws, we need to get a clear Federal definition of price gouging, and
the Federal Trade Commission will give that to us.
It also deals with every month of the year. The bill that we
introduced in September, and my colleague from Michigan's bill as well,
only deals with emergencies, when a disaster is declared. I think there
is justification for saying the Federal Trade Commission should have
authority to look at unfair trade practices, whatever time they may be.
{time} 1200
Mr. STUPAK. Mr. Speaker, will the gentlewoman yield?
Mrs. WILSON of New Mexico. I yield to the gentleman from Michigan.
Mr. STUPAK. The gentlewoman is wrong on our legislation. My
legislation, the FREE Act, applies to everything. It was your
legislation that only dealt with national emergencies.
Mrs. WILSON of New Mexico. If I am incorrect on that, I apologize,
Mr. Stupak. It was my understanding that your bill would require a
trigger.
Mr. STUPAK. If we had hearings and witnesses, we could bring out the
differences between the bills, but since we have been denied it, I have
to use this tactic to get the record straight on the floor.
Mrs. WILSON of New Mexico. I thank my colleague from Michigan.
This is a piece of legislation that all of us have been working on
for over 8 months now, and I look forward to working with him as we
move forward.
Also, this piece of legislation does not overwrite State law. In
other words, those 23 States that do have some form of price-gouging
legislation, that law stays in effect so that States can use the
Federal law, the Federal Trade Commission can use the Federal law, or
States can use their own law so that we don't preempt State law.
I think this is a good piece of legislation, a piece of legislation
that will help to address the problems that every American is feeling
at the pump and help to make America more energy independent. I ask my
colleagues for their support, and I urge adoption of H.R. 5253.
Mr. ETHERIDGE. Mr. Speaker, I am going to vote for H.R. 5253 because
I think it is a good bill and a timely bill. What took so long? Last
September, Representative Bart Stupak, Representative Stephanie
Herseth, and I drafted H.R. 3936, the Free Act, which would impose
severe penalties on oil companies, gas stations, and anyone who would
collude to raise the price of gas.
But for eight months the Republican leadership of this House has sat
on this legislation
[[Page H1999]]
and not allowed it to move forward. Only now, after gas prices have
risen to new heights, do the Republicans bring up this bill and call it
their own.
I urge support on H.R. 5253, but the American people deserve better
leadership in this body.
Mr. BARTON of Texas. Mr. Speaker, I ask that this exchange of letters
be included in the Record during today's debate on H.R. 5253.
U.S. House of Representatives,
Committee on the Judiciary,
Washington, DC, May 3, 2006.
Hon. Joe Barton,
Chairman Committee on Energy and Commerce, Rayburn House
Office Building, Washington, DC.
Dear Chairman Barton: In recognition of the desire to
expedite consideration of H.R. 5253, a bill to prohibit price
gouging in the sale of gasoline, diesel fuel, crude oil, and
home heating oil, the Committee on the Judiciary hereby
waives consideration of the bill. There are a number of
provisions contained in H.R. 5253 that implicate the Rule X
jurisdiction of the Committee on the Judiciary. Specifically,
the bill contains increases in criminal penalties under title
18 of the United States Code, which implicate the Judiciary
Committee's jurisdiction under Rule X(I)(l)(7) (``criminal
law enforcement'').
The Committee takes this action with the understanding that
by forgoing consideration of H.R. 5253, the Committee on the
Judiciary does not waive any jurisdiction over subject matter
contained in this or similar legislation. The Committee also
reserves the right to seek appointment to any House-Senate
conference on this legislation and requests your support if
such a request is made. Finally, I would appreciate your
including this letter in the Congressional Record during
consideration of H.R. 5253 on the House floor. Thank your
attention to these matters.
Sincerely,
F. James Sensenbrenner, Jr.,
Chairman.
____
U.S. House of Representatives, Committee on Energy and
Commerce,
Washington, DC, May 3, 2006.
Hon. F. James Sensenbrenner, Jr.,
Chairman, Committee on the Judiciary, Rayburn House Office
Building, Washington, DC.
Dear Chairman Sensenbrenner: Thank you for your letter
concerning H.R. 5253, a bill to prohibit price gouging in the
sale of gasoline, diesel fuel, crude oil, and home heating
oil.
I appreciate your willingness not to seek a referral on
H.R. 5253. I agree that your decision to forego action on the
bill will not prejudice the Committee on the Judiciary with
respect to its jurisdictional prerogatives on this or future
legislation. Further, I recognize your right to request
conferees on those provisions within the Committee on the
Judiciary's jurisdiction should they be the subject of a
House-Senate conference on this or similar legislation.
I will include our exchange of letters in the Congressional
Record during consideration of the bill on the House floor.
Sincerely,
Joe Barton,
Chairman.
Mr. GENE GREEN of Texas. Mr. Speaker, this legislation gives the FTC
explicit authority to define and prosecute price gouging by gasoline
retailers and wholesale distributors.
Given the amount of anger that Americans are feeling at the gasoline
pumps, we should have enacted similar legislation in law long ago.
There are certainly some price gougers out there, especially in
situations with tight supplies during emergencies, but the American
people should know that this legislation will not bring relief at the
pump this year.
First, the FTC will take six months to define price gouging before
they can enforce the new law.
Second, when the price of oil is $75 like it is this week, the price
of gasoline is going to be high, without any price gouging by anybody.
The price of oil used to be controlled by OPEC, but most energy
experts believe that stable OPEC nations are producing at near full
capacity.
The two major reasons why prices are going up is because of high
global demand, particularly the booming economies of China and India,
and instability in producing nations.
Iraq's oil production has never recovered to pre-war levels due to
the insurgency, and many believe that Iran's oil production could soon
be reduced due to our tensions with that nation.
In addition to being a large oil producer, Iran sits on the Straits
of Hormuz between the Persian Gulf and the Indian Ocean.
If conflict were to occur in that global oil shipping choke point,
the price of oil will increase even further.
Unfortunately instability in oil producing countries is not limited
to the Middle East. Nigeria, Angola, and other areas of Africa are
experiencing civil wars which are limiting oil exports.
Our Administration has been engaged in a war of words with the
President of Venezuela, which is one of our major oil suppliers.
Bolivia just sent the army in to occupy its oil and gas fields, some
of which had been jointly explored with Spanish and U.S. oil companies
under contracts approved by previous governments.
With all of these developments in oil producing nations and the
surging global economy, the price of oil has gone up dramatically and
the price of gasoline tracks the price of oil.
If a gas station or a gasoline distributor wants to use the
background of a rising market price to engage in price-gouging, they
should be stopped and punished.
The legislation by my friend Bart Stupak may be superior to this
legislation in some ways, and if the House was under Democratic control
we would have a more democratic process.
But this is a decent piece of legislation that gives the FTC
authority to investigate price gouging, so for that reason alone we
should approve it.
Mr. DINGELL. Mr. Speaker, I congratulate my colleagues on the other
side of the aisle for awakening at long last to the need to pass strong
anti-price gouging legislation to protect America's energy consumers.
It would have been far better if the House majority had come to this
realization last fall, when Representative Stupak offered a stronger
version of the bill we are now debating. Instead, the Republicans voted
down the Stupak bill on three separate occasions in Committee and on
the House floor. Apparently, the Majority has now seen the light, as
this new bill borrows heavily from H.R. 3936, anti-gouging legislation
sponsored by Rep. Stupak.
Better late than never, I suppose. But in the meantime, seven
critical months have elapsed during which all manner of shenanigans may
have occurred in the energy markets. Fortunately for consumers, a mild
winter sheltered them from the full effects of high prices during the
winter heating season, but last month gasoline prices shot up. As we
approach the summer driving season, there is no relief in sight.
In a perfect world, I would support Representative Stupak's bill over
the legislation now under consideration. In fact, since last December
House Republicans could have signed the discharge petition pending on
the Stupak bill and passed it on the suspension calendar. That would
have empowered the Federal Trade Commission to go after price gougers--
or better yet--the enactment of anti-gouging authority might have
deterred gasoline price gougers from taking advantage of U.S.
consumers.
Nonetheless, the bill before us today is much improved from the
version the Majority offered in the fall. The American energy consumer
is hurting and action is needed. I will, with some misgivings, support
the bill before the House.
Mrs. WILSON of New Mexico. Mr. Speaker, I yield back the balance of
my time.
The SPEAKER pro tempore (Mr. Boozman). The question is on the motion
offered by the gentleman from Texas (Mr. Barton) that the House suspend
the rules and pass the bill, H.R. 5253.
The question was taken.
The SPEAKER pro tempore. In the opinion of the Chair, two-thirds of
those present have voted in the affirmative.
Mrs. WILSON of New Mexico. Mr. Speaker, on that I demand the yeas and
nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the
Chair's prior announcement, further proceedings on this question will
be postponed.
____________________