[Congressional Record Volume 153, Number 100 (Wednesday, June 20, 2007)]
[Senate]
[Pages S8002-S8021]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   CREATING LONG-TERM ENERGY ALTERNATIVES FOR THE NATION ACT OF 2007

  The PRESIDING OFFICER. Under the previous order, the Senate will 
resume consideration of H.R. 6, which the clerk will report.
  The legislative clerk read as follows:

       A bill (H.R. 6) to reduce our Nation's dependence on 
     foreign oil by investing in clean, renewable, and alternative 
     energy resources, promoting new emerging energy technologies, 
     developing greater efficiency, and creating a Strategic 
     Energy Efficiency and Renewables Reserve to invest in 
     alternative energy, and for other purposes.

  Pending:

       Reid amendment No. 1502, in the nature of a substitute.
       Reid (for Bingaman) amendment No. 1537 (to amendment No. 
     1502), to provide for a renewable portfolio standard.
       Klobuchar (for Bingaman) amendment No. 1573 (to amendment 
     No. 1537), to provide for a renewable portfolio standard.
       Bingaman (for Klobuchar) amendment No. 1557 (to amendment 
     No. 1502), to establish a national greenhouse gas registry.
       Kohl (for DeMint) amendment No. 1546 (to amendment No. 
     1502), to provide that legislation that would increase the 
     national average fuel prices for automobiles is subject to a 
     point of order in the Senate.
       Corker amendment No. 1608 (to amendment No. 1502), to allow 
     clean fuels to meet the renewable fuel standard.
       Cardin modified amendment No. 1520 (to amendment No. 1502), 
     to promote the energy independence of the United States.
       Collins amendment No. 1615 (to amendment No. 1502), to 
     provide for the development and coordination of a 
     comprehensive and integrated U.S. research program that 
     assists the people of the United States and the world to 
     understand, assess, and predict human-induced and natural 
     processes of abrupt climate change.
       Baucus amendment No. 1704 (to amendment No. 1502), to amend 
     the Internal Revenue Code of 1986 to provide for energy 
     advancement and investment.

  The ACTING PRESIDENT pro tempore. Under the previous order, there 
will now be 30 minutes of debate on amendment No. 1546, offered by the 
Senator from South Carolina, Mr. DeMint, with the time equally divided 
and controlled between the Senator from New Mexico, Mr. Bingaman, and 
Mr. DeMint.
  Who yields time? The Senator from South Carolina is recognized.
  Mr. DeMINT. Mr. President, I ask unanimous consent to be allowed to 
speak as in morning business for up to 5 minutes and that it count 
against my allocated 15 minutes on my amendment and that it appear in a 
separate place in the Record.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  (The remarks of Mr. DeMINT are printed in today's Record under 
``Morning Business.'')


                           Amendment No. 1546

  Mr. DeMINT. Mr. President, I wish to take a few minutes to speak 
about my amendment which the Senate will be voting on a few minutes 
after 10 this morning. This amendment would create a 60-vote point of 
order against bills or amendments in the future that would raise the 
price of gasoline.
  This amendment is very straightforward. It would require the 
Congressional Budget Office to score legislation to determine if it 
would increase the cost of gasoline. If the legislation would increase 
the cost of gasoline, a 60-vote point of order would lie against the 
bill.
  This applies the same principle we use in the Congressional budget 
process to our energy policy. The traveling public is coping with the 
high price of gasoline every day. While there are many factors out of 
our control forcing up the price of gas, we can control what we do here 
in the Senate.
  For all the time that has been spent over the last few weeks railing 
against big oil or the high cost of gasoline, little time has been 
spent to examine one of the leading causes of high prices of gasoline, 
which is the Congress. Too often the idea of a rational energy policy 
here in Congress is to create burdensome regulations, onerous mandates, 
and higher taxes, all of which directly translate into higher prices at 
the pump for American families. My amendment proposes to hold Congress 
in check by instituting a safeguard that encourages the Senate to take 
a ``do not harm'' approach when considering legislation affecting gas 
prices.
  My amendment, again, is very straightforward and very simple. If the 
Senate wants to pass legislation that

[[Page S8003]]

will make it more expensive for American families to fill up their 
tank, we will be required to get 60 votes instead of 51 to pass the 
legislation. While this amendment is relatively simple, it is also 
vitally important, because, while many of the Democrats in this body 
like to tell the American people they are working to ``stick it to big 
oil'' and lower the price of gasoline, their legislative record shows 
something quite different.
  The current bill is a perfect example. According to a study completed 
this week by the Heritage Foundation, the Energy bill we are currently 
debating could result in significantly higher prices for gasoline to 
consumers. A review of the legislation, including the new amendment 
dealing with tax changes, revealed the bill could increase the price of 
regular unleaded gasoline from $3.15 per gallon, which is the May 
average right now, to $6.40 a gallon by 2016.
  That is an increase of over 100 percent. The point of order my 
amendment proposes could not be used against this bill because it 
cannot take effect until the bill is enacted. But my amendment could be 
used to stop similar legislation in the future. If this Congress is 
willing to consider legislation that would raise the price of gasoline 
by over 100 percent, as this bill may do, we need to put some 
commonsense safeguards in place.
  I know some of my colleagues may in the future support policies that 
would raise the price of gasoline. That would cause the point of order 
I am proposing to lie against the bill. But I would encourage even 
those to support this amendment. If their policy goal is so important, 
then we can overcome the point of order and we can get 60 votes to pass 
their legislation.
  We should adopt this commonsense proposal that ensures that at the 
very least the Senate is less likely to increase the cost of gasoline. 
After all the concerns we have heard from my Democratic colleagues 
about the price of gasoline, this seems the least we can do.
  I reserve the remainder of my time.
  The ACTING PRESIDENT pro tempore. The Senator from New Mexico.
  Mr. BINGAMAN. Mr. President, the DeMint amendment as described by 
Senator DeMint creates a 60-vote point of order in the Senate on any 
legislation or part of legislation that would ``result in an increase 
in the national average fuel price for automobiles.''
  By legislation, that is usually interpreted to mean a bill, a joint 
resolution, an amendment, a motion, or a conference report. The 
determination of whether any of those enumerated items would result in 
an increase in the national average fuel price for automobiles would be 
made by CBO in consultation with the Energy Information Administration.
  This is another piece of ``feel good'' legislation that would have 
the probable effect of making a great deal of what we do here in the 
Senate subject to a 60-vote point of order. Frankly, world oil prices 
and domestic fuel prices are swayed by all sorts of influences and 
psychological factors in the market. To think the Congressional Budget 
Office would be able to analyze price effects of legislative proposals 
might play in this complex stew of what traders and producers and major 
refiners think will happen is not realistic. This point of order would 
give a tremendous amount of influence to the petroleum industry. Most 
anything we do up here causes them to complain we are likely to raise 
gasoline prices as a result.
  For example, they are saying that right now about the 
antimanipulation and consumer protection provisions in the bill that 
were voted out of the Commerce Committee. If there were a 60-vote point 
of order their complaint could trigger, they would certainly be in 
constant contact with Member offices and with the Congressional Budget 
Office trying to boost the minimum votes necessary for these proposals 
to 60 votes.

  Let me give you a few examples of amendments to the bill Members want 
to offer that might be caught up in this kind of a point of order. 
Senator Cochran has an amendment he wants to offer to increase the size 
of the Strategic Petroleum Reserve. Any purchase of oil for the SPR 
would take that oil off the market and potentially raise fuel prices. 
That would trigger the DeMint point of order.
  Another example is the provision in the amendment that was adopted in 
the Senate by over 60 votes yesterday that is referred to generally as 
NOPEC, which essentially says U.S. courts will be open and available 
and have jurisdiction to consider antitrust claims against foreign 
governments that are getting together and trying to conspire to set oil 
policies. That legislation could clearly affect the price of oil and 
thereby the price of gasoline at the pump. We have an interest in 
creating reserves of products for refined gasoline. We already have a 
heating oil reserve. Legislation to establish new product reserves or 
to increase the size of the heating oil reserve would likely trigger 
this point of order my friend is suggesting we ought to put into our 
procedural law.
  Our military posture in the Persian Gulf has a great deal to do with 
the world price of oil. We might find that amendments or other 
legislative proposals dealing with sensitive military or diplomatic 
issues in that region would have an effect on automobile fuel prices 
under this amendment and could thus trigger the point of order. We 
might see the whole Defense bill annually subjected to the DeMint point 
of order on the claim that what we are proposing to do in the Defense 
bill could increase the price of gasoline at the pump.
  It is worth focusing on the fact that the point of order is triggered 
by ``an increase'' found by the Congressional Budget Office. That 
increase could be less than a penny a gallon and still the 60-vote 
point of order would be triggered as the amendment is drawn.
  Another example would be any legislation that might be considered on 
the Senate floor related to Nigeria and our relations with Nigeria. 
Clearly, we are heavily dependent upon oil from Nigeria to meet our 
energy needs. Any instability in that relationship could affect the 
price of oil or the price of gasoline as a result of increases in the 
price of oil.
  People are always complaining it is hard to get things done here in 
the Congress. We have too many procedural wrangles here in the 
Congress. There is an abundance already of procedural hurdles that any 
legislative proposal has to surmount in order to get passed.
  We have been pleading with various Senate Members in connection with 
this exact bill to try to get permission to bring up different 
amendments, even agreeing that we would be bound by a 60-vote point of 
order or a 60-vote requirement to do that. So we already have 
procedural hurdles in place in abundance. We should not be inserting 
into Senate procedures a requirement that will come back to haunt both 
Republicans and Democrats in completely unforeseen and unforeseeable 
ways just in order to say we did something about high gas prices.
  I strongly urge that we not agree to the DeMint amendment.
  The ACTING PRESIDENT pro tempore. The Senator from South Carolina.
  Mr. DeMINT. How much time do I have remaining?
  The ACTING PRESIDENT pro tempore. The Senator has 7\1/2\ minutes.
  Mr. DeMINT. Mr. President, I very much appreciate the Senator's 
remarks. I think the remarks were very instructive. It is clear that 
many of things we do in the Senate actually do result in increased gas 
prices.
  Most of the discussion and a lot of the initiative and motivation of 
the bill we are working on is to lower gas prices. The fact is, in the 
past, though, we have not been honest and transparent with the American 
people. Many times we are talking about our good intentions, things we 
are going to do here, and we do not expose the fact that what we are 
doing is going to increase the cost of gasoline. I think that is a fair 
part of the debate. If we want to increase our national reserves of 
oil, then it is fair in that debate to make it clear to the American 
people that if we do it, it may increase the cost of gasoline to them 
at home, so all of us who are considering the issue can balance it.
  If some aid program to Nigeria is going to increase the cost of 
gasoline here at home, the American people should know that, so we 
cannot claim to be doing something for people without them realizing it 
is costing them more and more money.

[[Page S8004]]

  I understand the objections to procedural hurdles here. Actually, 
that is the way the Senate was designed so that we do not do things in 
a knee-jerk fashion, without openness and debate, so we actually do 
figure out the consequences of what we do in advance of passing 
legislation.
  We have not done that in the past. Many of our rules have created 
different boutique, different fuel requirements in many States, a lot 
of environmental concerns--a lot of things that are good actually 
increased the cost of gasoline a significant degree.
  It is important that we include that in our debate. While we may be 
resistant to procedural hurdles, much of the bill we are debating 
creates multiple procedural hurdles to increase new gas supplies, oil, 
natural gas. It creates new mandates, new taxes. We create a lot of 
hurdles for the energy business to create more supply so we can lower 
the price of gasoline. This amendment exposes us for what we are and 
what we are doing. If we are going to propose things in the Senate 
related to energy, the Congressional Budget Office, as my amendment 
says, in consultation with the Energy Information Administration and 
other appropriate Government agencies, can help make a determination if 
what we are doing is going to raise the price of gasoline. That is a 
fair part of an honest debate.
  To snuff this out and to come down to the Senate floor and make great 
claims about what we are going to do to help the American people while 
all the time hiding from them that we are the ones raising their gas 
prices--it is not big oil, it is not necessarily even OPEC, it is us. 
We add lots of costs to gasoline every time we pass an energy bill. 
This Energy bill is no exception.
  While my amendment doesn't affect this bill, it does create a point 
of order in the future. You can call this a hurdle, but if 60 people in 
the Senate cannot decide that it is more important to increase the size 
of our national reserve, even though it might increase the cost of 
gasoline, if 60 of us are not for that, then perhaps we should hesitate 
before we increase the cost of gasoline again to the consumers.
  This is one of the rare simple bills that come to the Senate. It is 
just a couple of pages. All it does is say that when we introduce a 
bill that increases the cost of gasoline for American consumers, we 
have to get 60 votes instead of 51 to pass it. It is a reasonable 
proposal. If we are willing to come here and talk every day about what 
we are doing to help the consumer and at the same time we want to hide 
from them that the things we are doing are actually increasing the cost 
of gasoline, then shame on us.
  This amendment is simple. It is about transparency, openness, and 
honesty to the people. That is exactly what they deserve.
  I urge all of my colleagues to vote for this amendment.
  I yield back the remainder of my time.
  The ACTING PRESIDENT pro tempore. Who yields time?
  Mr. BINGAMAN. I suggest the absence of a quorum.
  The ACTING PRESIDENT pro tempore. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. DeMINT. I ask unanimous consent that the order for the quorum 
call be rescinded.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Mr. DeMINT. Mr. President, it has been brought to my attention that 
the majority will seek to defeat my amendment by raising another point 
of order against it. This demonstrates exactly how much the Democrats 
dislike this amendment. It proves that they have additional plans in 
the works to raise gasoline prices on the American people. Why else 
would they be fighting it so hard? I also believe this effort to deny 
the Senate a clean up-or-down vote on this amendment shows that some in 
this body are more interested in defending the jurisdiction and rights 
of a Senate committee than they are in defending American consumers. If 
the other side raises a point of order against my amendment, I 
encourage my colleagues to ask themselves which is more important: 
protecting Americans from high gas prices or protecting the 
jurisdiction of the Budget Committee?
  I urge my colleagues to vote to waive the Budget Act. If the other 
side tries to kill my amendment and stick it to the American people at 
the pump, I encourage Members to vote against such an effort.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. Who yields time?
  Mr. DeMINT. I suggest the absence of a quorum.
  The ACTING PRESIDENT pro tempore. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. BINGAMAN. I ask unanimous consent that the order for the quorum 
call be rescinded.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Mr. BINGAMAN. Mr. President, part of our debate has involved the 
question of whether we have too many procedural hurdles already 
impeding the work of the Senate and keeping us from conducting up-or-
down votes on things. I strongly believe we do have too many procedural 
hurdles. Obviously, the purpose of the DeMint amendment would be to put 
more procedural hurdles in place so that a 60-vote point of order would 
be required in many circumstances in the future where it is not 
required today for the Senate to act.
  I am informed that one of the procedural hurdles already in law is 
under the Budget Act and that the pending amendment deals with matter 
within the Budget Committee's jurisdiction in that the DeMint amendment 
would direct CBO to take a variety of actions. That is exclusively 
within the jurisdiction of the Budget Committee.
  I raise a point of order that the pending amendment violates section 
306 of the Congressional Budget Act of 1974.
  I yield back the remainder of my time.
  Mr. DeMINT. Mr. President, I move to waive the budget point of order.
  The ACTING PRESIDENT pro tempore. The question is on agreeing to the 
motion to waive the Budget Act in relation to amendment No. 1546.
  Mr. BINGAMAN. I ask for the yeas and nays.
  The ACTING PRESIDENT pro tempore. Is there a sufficient second?
  There appears to be a sufficient second.
  The clerk will call the roll.
  The assistant legislative clerk called the roll.
  Mr. DURBIN. I announce that the Senator from Indiana (Mr. Bayh), the 
Senator from Delaware (Mr. Biden), the Senator from South Dakota (Mr. 
Johnson), and the Senator from Illinois (Mr. Obama) are necessarily 
absent.
  Mr. LOTT. The following Senators are necessarily absent: the Senator 
from Kansas (Mr. Brownback), the Senator from Oklahoma (Mr. Coburn), 
and the Senator from Arizona (Mr. McCain).
  The PRESIDING OFFICER (Mr. Whitehouse). Are there any other Senators 
in the Chamber desiring to vote?
  The yeas and nays resulted--yeas 37, nays 55, as follows:

                      [Rollcall Vote No. 217 Leg.]

                                YEAS--37

     Allard
     Bennett
     Bond
     Bunning
     Burr
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeMint
     Dole
     Domenici
     Ensign
     Enzi
     Graham
     Grassley
     Hagel
     Hatch
     Hutchison
     Inhofe
     Isakson
     Kyl
     Lott
     Martinez
     McConnell
     Nelson (NE)
     Roberts
     Sessions
     Shelby
     Smith
     Snowe
     Sununu
     Thune
     Vitter

                                NAYS--55

     Akaka
     Alexander
     Baucus
     Bingaman
     Boxer
     Brown
     Byrd
     Cantwell
     Cardin
     Carper
     Casey
     Clinton
     Conrad
     Corker
     Dodd
     Dorgan
     Durbin
     Feingold
     Feinstein
     Gregg
     Harkin
     Inouye
     Kennedy
     Kerry
     Klobuchar
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Lugar
     McCaskill
     Menendez
     Mikulski
     Murkowski
     Murray
     Nelson (FL)
     Pryor
     Reed
     Reid
     Rockefeller
     Salazar
     Sanders
     Schumer
     Specter
     Stabenow
     Stevens
     Tester
     Voinovich
     Warner
     Webb
     Whitehouse
     Wyden

                             NOT VOTING--7

     Bayh
     Biden
     Brownback
     Coburn
     Johnson
     McCain
     Obama
  The PRESIDING OFFICER. Three-fifths of the Senators duly chosen and

[[Page S8005]]

sworn not having voted in the affirmative, the motion is not agreed to. 
The point of order is sustained and the amendment falls.
  Mr. BINGAMAN. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. BINGAMAN. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BINGAMAN. Mr. President, I understand the Senator from New 
Hampshire has an amendment he wishes to offer at this time. He has 
agreed to a time limit wherein we would have 40 minutes equally 
divided, half to be controlled by Senator Gregg, the other half to be 
controlled by Senator Grassley, or their designees. It would be 40 
minutes prior to any vote in relation to the amendment.
  Mr. GREGG. Mr. President, reserving the right to object, for 
clarification, we are going to have 40 minutes of debate and then at 
some point we will have the vote, right?
  Mr. BINGAMAN. We will have 40 minutes of debate and then at some 
point we will have a vote. We may not have it immediately at the end of 
that 40 minutes.
  Mr. GREGG. But we will have 40 minutes of debate now equally divided 
between myself and Senator Grassley, and then when we get to a vote on 
it, we will have 2 minutes equally divided.
  Mr. BINGAMAN. I am suggesting we go ahead and vote at the end of 40 
minutes. So we will have 40 minutes of debate equally divided and then 
we will have a vote.
  Mr. GREGG. If that is agreeable with the managers, that is fine with 
me.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.


                Amendment No. 1718 to Amendment No. 1704

  Mr. GREGG. Mr. President, I send an amendment to the desk.
  Is there an amendment pending? This is a second-degree amendment to 
the Baucus amendment.
  The PRESIDING OFFICER. The clerk will report the amendment.
  The assistant legislative clerk read as follows:

       The Senator from New Hampshire [Mr. Gregg] proposes an 
     amendment numbered 1718 to amendment No. 1704.

  Mr. GREGG. Mr. President, I ask unanimous consent that the reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

  (Purpose: To strike the provision extending the additional duty on 
                    ethanol and for other purposes)

       Strike section 831 and insert the following:

     SEC. 831. ELIMINATION OF ETHANOL TARIFF AND DUTY.

       (a) In General.--
       (1) Elimination of permanent tariff of 2.5 percent.--
     Subheading 2207.10.60 of the Harmonized Tariff Schedule of 
     the United States is amended--
       (A) by striking the column 1 general rate of duty and 
     inserting ``Free''; and
       (B) by striking the matter contained in the column 1 
     special rate of duty column and inserting ``Free''.
       (2) Elimination of permanent tariff of 1.9 percent.--
       (A) In general.--Chapter 22 of the Harmonized Tariff 
     Schedule of the United States is amended by inserting in 
     numerical sequence the following new subheading:


``       2207.20.20       Ethyl alcohol and    Free                 Free (A+, AU, BH,    20%                  ''
                           other spirits,                            CA, CL, D, E, IL,                         .
                           denatured, of any                         J, JO, MA, MX, P,
                           strength (if used                         SG)
                           as a fuel or in a
                           mixture to be used
                           as a fuel)........

       (B) Conforming amendment.--The article description for 
     subheading 2207.20.00 of the Harmonized Tariff Schedule of 
     the United States is amended by inserting ``(not provided for 
     in subheading 2207.20.20)'' after ``strength''.
       (b) Repeal of Temporary Duty of 54 Cents Per Gallon.--
     Subchapter I of chapter 99 of the Harmonized Tariff Schedule 
     of the United States is amended--
       (1) by striking heading 9901.00.50; and
       (2) by striking U.S. Notes 2 and 3 relating to heading 
     9901.00.50.
       (c) Effective Date.--The amendments made by this section 
     apply with respect to goods entered, or withdrawn from 
     warehouse for consumption, on or after the 15th day after the 
     date of the enactment of this Act.

  Mr. GREGG. Mr. President, this amendment is an attempt to remedy what 
is an unfortunate situation, which is that people who cannot buy 
ethanol from the Midwest and have to buy it from other sources, 
especially outside the United States, end up being taxed at 54 cents a 
gallon.
  So people from the east coast and, to some degree, from the west 
coast are paying an excessive amount to use product which significantly 
improves the environment and which also obviously reduces our 
dependence on oil.
  The argument at the time this tariff was originally initiated was we 
needed to protect the ethanol production capability of the Midwest, the 
corn producers. That may have had some resonance a few years ago, but 
it certainly does not have any resonance any longer. It does not have 
any credibility any longer.
  Today, there are about 7.5 billion gallons of ethanol produced in 
this country. Under this bill it is required that go up to 36 billion 
gallons. Most of that will come from the production of corn, most 
likely in the Midwest. So there is already a huge demand for corn, and 
corn prices are high. In fact, they are so high as a result of the use 
of corn for ethanol that many people who use corn as feedstock are 
complaining vociferously. So there is no need to protect production in 
the Midwest with a tariff that impacts people on the east coast 
disproportionately.
  The second reason there is no need for this tax is that people from 
the east coast cannot get ethanol from the Midwest because it cannot be 
shipped efficiently. That is because ethanol cannot be shipped through 
pipelines because of its volatility. Therefore, our only option on the 
east coast is to buy ethanol that comes from outside the country, the 
Caribbean Basin and Brazil. Therefore, it makes no sense to penalize 
the east coast to try to encourage production in the center of the 
country for corn and ethanol when the corn is already being 
significantly subsidized to the tune of $3 billion annually just 
through agricultural subsidies. But, in addition, its production is 
being encouraged by the requirement that we produce so much ethanol in 
this country that corn is essentially the feedstock for it, and that we 
therefore are having a dramatic expansion in the production of corn and 
the utilization of corn.
  This is not as if in any way this is going to affect that production 
capability. What it does do, however, is put us in the right place 
environmentally, and in the right place from a standpoint of 
utilization of energy sources because we should be using ethanol, 
obviously, and on the east coast we want to use ethanol. We just want 
to pay a fair price for it.
  When we have this 54-cent-a-gallon tax on the consumers in the 
Northeast and the East, it is not a fair price. If we take this tax 
off, we will actually expand ethanol consumption in the East, and so, 
hopefully, at some point they will figure out a way to ship ethanol 
through pipelines and that will create a greater demand for ethanol 
generally in this Nation since so many people live on the east coast. 
And that will, again, help the production in the Midwest once we figure 
out how to ship it efficiently to the East because the demand will have 
been created.
  Secondly, we have a choice. We can either heat with oil and we can 
run our cars on oil and gas or we can run in part on ethanol. The 
simple fact is, however, I would rather buy ethanol from Brazil than 
oil from Venezuela. It makes a lot more sense geopolitically as to how 
we protect ourselves. It is a cleaner burning energy, it is a better 
form of energy, and it is an energy which should be burned and is an 
energy that I think is a national policy

[[Page S8006]]

we would rather buy than underwriting the present Venezuelan Government 
by having to buy oil there.
  So the concept of having this tariff, which is essentially a 54-cent-
a-gallon tax on everybody who lives on the east coast, is no longer 
viable. It is not viable because corn production is up dramatically, 
the price of corn is up dramatically, and it will continue to go up 
especially under this bill since we are going to require a dramatic 
increase in the number of gallons which are ethanol based.
  So the ethanol industry, to the extent it is corn based, is going to 
continue to grow and be viable, and they do not need this tariff 
production, which is its only purpose. It is not viable because it is 
not an efficient way for us to purchase energy, to have us pay this 
much extra money in tariffs so we basically undermine the use of 
ethanol on the east coast. It is not a good policy because it 
encourages the use of Venezuelan or other types of oil imports over 
ethanol because of the pricing situation. And it is not a good idea 
because it is simply bad policy to have in place this type of tariff.
  This is not the mercantile period of the 19th century when we 
basically arbitrarily threw tariffs on products in order to create an 
inefficient marketplace, which was something we thought was going to 
help some producer here or there. It makes much more sense to have a 
situation where consumers can purchase ethanol-based products at 
reasonable prices so we can get more utilization of ethanol.
  This amendment would eliminate the 54-cent-a-gallon tax which is 
targeted on a majority, quite honestly, of the American population and 
which the majority of Americans should not have to pay.
  I reserve the remainder of my time.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, I hope Senator Thune is here. I was 
going to yield time to him first.
  I yield myself a couple minutes while we are waiting for Senator 
Thune.
  Mr. President, first of all, to change direction from where Senator 
Gregg was, today corn is $3.50 in central Iowa, and it is down 25 cents 
from yesterday because it rained in Illinois in the last 48 hours. So 
weather is affecting the price of grain quite a bit. If city slickers 
are worried about the price of corn flakes going up, just remember that 
a farmer only gets a nickel out of every box of corn flakes that is 
half filled with air anyway. There are events that are affecting the 
price of corn a lot different from just ethanol. But the impression one 
gets around here when reading the papers is that there is so much corn 
going into ethanol that it is driving up the price of food for city 
people around this country.
  The other issue is that the Senator from New Hampshire said corn is 
being subsidized $3 billion. When corn is above roughly $2 in the 
Midwest, there is no loan deficiency payment being paid out for that 
corn. So at the price corn is today, there is no subsidy for corn.
  Another issue we ought to think about is, whether we are importing 
ethanol or importing oil--don't forget, a few years ago, we started a 
program of tax incentives for ethanol and other renewables so we would 
be energy independent. Do we want to be dependent on imported ethanol 
as we are dependent on imported oil?
  What is involved is an infant industry that is just now being able to 
come to a peak with great advancement in the future but still infant 
from the standpoint that the next step in ethanol production is 
cellulosic ethanol, to get ethanol not from grain corn but from wood 
chips, from switchgrass, or from corn stover. It will be 3 to 5 years 
before the scientific process of enzymes is efficient enough for that 
production to come about.
  Even though we are now having a massive production of ethanol from 
grain corn, we cannot sustain this beyond 15 billion gallons of ethanol 
coming from grain corn or corn getting above that figure. And the 
underlying bill from the Senate Energy Committee recognizes that point 
because they have a 15-billion-gallon limit of grain corn producing 
ethanol. Beyond that, it is going to have to come from wood chips, 
switchgrass, corn stover--anything that has cellulose in it from which 
they can make ethanol.
  Just because all of a sudden we have a burgeoning production of 
ethanol from grain corn doesn't mean this industry is mature to a point 
where we are going to be as energy efficient as we should be, as energy 
independent as we should be, and that is why it is still necessary to 
keep the tax incentives. That is why it is still necessary to have this 
import duty.
  I am going to continue to yield time to myself until Senator Thune 
arrives. I wish to make a statement in opposition to the amendment 
offered by the distinguished Senator from New Hampshire.
  With today's gas prices, many in Congress are looking for solutions 
and for someone to blame. Unfortunately, some have chosen to pinpoint 
ethanol as the culprit. Because of new demand for ethanol, some of my 
colleagues have begun to argue that there is a shortage and that it is 
responsible for the rising cost of gasoline. They look to increased 
imports of ethanol and the lifting of the import tariff as a solution, 
and that is the substance of the amendment that is before us. But 
increased imports would have little impact on the price of gasoline. 
Let me emphasize because that is the basis of the amendment and I am 
saying the amendment is not going to accomplish its goal. Increased 
imports will not reduce the price of gasoline. This is the case because 
ethanol is such a tiny fraction of the cost of gasoline. In fact, in 
Iowa, you can buy a gallon of ethanol gasoline mixture--90 percent 
gasoline, 10 percent ethanol--for 8 to 10 cents under what the price of 
100 percent of ethanol costs.
  In regard to not changing the price of gasoline, I quote Guy Caruso, 
Administrator of the Energy Information Administration of the 
Department of Energy, last year saying that the 10-percent blend of 
ethanol is affecting price by ``just a few pennies.'' Ethanol's role in 
gasoline prices is a tiny fraction of the overall increase.
  In addition, it is important to point out that the United States 
already provides significant opportunities for countries to ship 
ethanol into our market duty free. Numerous countries do not pay the 
U.S. ethanol tariff at all. Through our free-trade agreements and trade 
preference programs, some 73 countries currently have duty-free access 
to U.S. markets for ethanol fully produced in those countries. For all 
other countries, including Brazil, the world's major exporter of 
ethanol, the United States provides duty-free access through a carve-
out in the Caribbean Basin Initiative.
  Get it right: Brazilian ethanol exporters don't have to pay the U.S. 
tariff today. Under this CBI, ethanol produced in Brazil and other 
countries that is merely dehydrated in a Caribbean country can enter 
the United States duty free up to 7 percent of the U.S. ethanol market, 
a very generous access, and it has been on the books for 20 years. Yet 
Brazil and other countries have never come close to hitting this 7-
percent cap of ethanol that can come into our country duty free 
already. In fact, we are almost halfway through 2007, and this duty-
free cap has been filled only 23 percent for this year.
  Moreover, this cap grows every year because this 7 percent is 7 
percent of a higher figure because of higher production of domestic 
ethanol every year. And it isn't that the Caribbean countries don't 
have the capacity to dehydrate more ethanol. They do have that 
capacity.

  So we are already providing duty-free access for Brazilian ethanol 
that is shipped through the Caribbean countries. Much of this duty-free 
ethanol is being exported to the East Coast, the part of the country 
that Senator Gregg contends would benefit from the complete lifting of 
the U.S. tariff on ethanol.
  The fact of the matter is that Brazil isn't taking full advantage of 
duty-free treatment currently available to them. I don't know why we 
should bend over backward to provide more duty-free access for Brazil. 
In fact, I would offer to the authors of this amendment that when this 
7 percent loophole gets filled and that much ethanol has come into the 
country, I would be glad to sit down and see if there is a need to lift 
the cap totally.
  I especially don't know why we should do this, given Brazil's stance 
in the Doha Round negotiations of the World Trade Organization. Brazil 
is the

[[Page S8007]]

leader of the G20 negotiating group in the WTO negotiations, a group 
that is resisting our efforts to obtain improved market access for U.S. 
products, both manufactured and agricultural, throughout the entire 
world.
  In addition, the Brazilian Government intervenes extensively in the 
price and supply of ethanol in that country. But the U.S. tariff on 
ethanol operates as an offset to a U.S. excise tax credit that applies 
to both domestically produced as well as imported ethanol. So by 
lifting the tariff, we would, in effect, be giving the benefits of this 
tax credit to subsidize the Brazilian production of ethanol.
  Providing yet more duty-free treatment for subsidized Brazilian 
ethanol would send the wrong signal to those Americans who are devoting 
their careers to helping America become more energy independent. The 
U.S. ethanol industry is working every day to lessen our dependence 
upon foreign oil. This is a virtue that President Bush has touted again 
and again. Last year, the President restated his goal to replace oil 
around the world by expanding the production of ethanol.
  The President stated:

       The Federal Government has got a role to play to encourage 
     new industries that will help this Nation diversify away from 
     oil. And so we are strongly committed to corn-based ethanol 
     produced in America.

  And today the President would add to that we are committed to doing 
more in cellulosic production of ethanol as well.
  The President clearly understands the need to assist our infant 
domestic ethanol industry so we can get a foothold and we can succeed. 
Why would the United States now want to send a signal that we are 
backing away from our efforts to seek energy independence? We are 
already dependent upon foreign oil. Surely we don't want our country to 
go down the path of eventually becoming dependent upon foreign ethanol 
as well.
  Providing yet more duty-free treatment would be a step in the wrong 
direction, discouraging the advancement of investment in biorefineries 
for ethanol and biodiesel. It would be bad for energy independence and, 
obviously, bad for our national security. So I hope my colleagues will 
oppose the Gregg amendment.
  Mr. DOMENICI. Mr. President, will the Senator yield?
  Mr. GRASSLEY. Yes.
  Mr. DOMENICI. Does the Senator have a minute left for the Senator 
from New Mexico?
  Mr. GRASSLEY. Mr. President, how much time do I have remaining?
  The PRESIDING OFFICER. Seven minutes.
  Mr. GRASSLEY. Mr. President, I yield 1 minute to the Senator from New 
Mexico and then 5 minutes to the Senator from South Dakota.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, I wish to congratulate the Senator on 
his remarks and say I concur with them. I would say this is the wrong 
time, while we are trying to enhance the investment in cellulosic 
ethanol and everything that goes with that, to come along with this 
idea. This would weaken the investment potential and the credibility of 
investment right when it is ripening and really generating interest.
  This requires billions of dollars to be invested in cellulosic 
ethanol as we move to the next generation, and to have weakening that 
comes from this issue as to what is going to happen with this export-
import issue is the wrong thing. I encourage colleagues to follow the 
lead of Senator Bingaman and Senator Grassley.
  Mr. President, I yield the floor.
  Mr. GRASSLEY. Mr. President, I yield 5 minutes to Senator Thune.
  The PRESIDING OFFICER. The Senator from South Dakota.
  Mr. THUNE. Mr. President, I wish to join my colleague from Iowa in 
opposing this amendment. In 2006, America's ethanol industry 
contributed over $41 billion to the national economy. Operation and 
construction of domestic biorefineries created 163,034 jobs in all 
sectors of the economy last year alone.
  The bill before the Senate builds upon this success by boosting the 
renewable fuel standard to 36 billion gallons by the year 2022 and 
establishing other valuable incentives for renewable energy production. 
The amendment proposed by Senator Gregg, our colleague from New 
Hampshire, would send mixed signals to our ethanol producers, their 
investors, and the farmers who sell their products to ethanol plants.
  In effect, what Congress would be doing is telling the ethanol 
industry: We are demanding more of your product, but at the same time 
we are going to open the back door and begin subsidizing foreign 
sources of ethanol. If this amendment is adopted, our marketplace would 
be flooded with heavily subsidized ethanol from foreign countries.
  In 2006, Brazil exported 433 million gallons into the United States, 
which is an increase of 400 million gallons over the year 2005. That 
same year, Brazil paid over $220 million in duties to import this 
amount of ethanol. They were already importing ethanol into this 
country through the Caribbean Basin Initiative. They have not reached 
that cap, but I think it is fair to expect they are going to continue 
to flood the U.S. market every opportunity they get with ethanol that 
is produced in Brazil.

  The tax credit that currently is in place for domestic ethanol is 
critical to the success of our industry, and it does not discriminate 
between domestic or foreign sources of ethanol. So what happens is, as 
soon as the Brazilian ethanol is blended with gasoline in the United 
States, taxpayers begin paying 51 cents for each gallon of foreign 
ethanol. If Senator Gregg's amendment is accepted, American taxpayers 
will immediately begin subsidizing hundreds of millions of gallons of 
foreign-made ethanol each year with no offsetting duty. Simply put, by 
eliminating this tariff, we would trade our dependence upon foreign 
sources of oil for a new and growing dependence upon foreign ethanol.
  I would add the critics of this tariff have argued that it inflates 
the cost of gasoline in this country. In fact, gasoline prices, as my 
colleague from Iowa has noted, would not be affected by removing the 
tariff on imported ethanol. Ethanol itself represents less than 5 
percent of U.S. motor fuel supplies, and imported ethanol represents a 
small fraction of that percentage.
  The factors truly driving the price of gasoline higher have nothing 
to do with ethanol supplies. Record crude oil prices, tight refining 
capacity, lower gasoline production, and limited expansion of domestic 
refining expansion all play a much greater role than the supply of 
ethanol in today's higher gasoline prices.
  Critics of the tariff also claim we will need ethanol imports to meet 
the growing demand for ethanol and to comply with the strengthened 
renewable fuel standard. Again, the facts tell a very different story. 
Our Nation's current domestic production capacity is 6.2 billion 
gallons of ethanol. According to industry experts, an additional 6.4 
billion gallons of capacity are currently under construction and will 
soon be refining ethanol. That is a total of 12.8 billion gallons in 
current planned production, which is more than enough--more than 
enough--to meet the heightened renewable fuel standards in the near 
term.
  Additionally, we have to keep in mind the limitations placed on 
ethanol demand due to blend restrictions. Right now, only E10, 10 
percent ethanol and 90 percent gasoline, is approved for use in 
nonflex-fuel vehicles. There is a point at which we are going to hit 
the E10 wall. Domestic production, as you can see if you look at this 
chart of ethanol production in this country, is more than adequate to 
meet the full market potential for E10. Some industry analysts predict 
we will very soon have excess ethanol production capacity when we hit 
the E10 wall.
  That is why it is so important we expand ethanol and allow for higher 
blends--E15, E20--which in my view is something long overdue. The E10 
wall is the point at which the market for E10 ethanol is saturated if 
ethanol production continues to grow at a record pace. While some in 
the industry disagree on when we will hit the E10 wall, it is clear it 
would have a harmful effect on the overall ethanol industry if Congress 
fails to act. Lifting the tariff on ethanol imports would only flood 
the marketplace with foreign ethanol, further magnifying the impact of 
the E10 wall.
  Clearly, there are several reasons why my colleagues in the Senate

[[Page S8008]]

should oppose this amendment, which undermines our national energy 
policy of greater energy independence. So I ask my colleagues to oppose 
the amendment.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER (Mr. Tester). The Senator from New Hampshire.
  Mr. GREGG. Mr. President, I yield 3 minutes to the Senator from 
Arizona.
  Mr. KYL. Mr. President, the Baucus amendment from the Finance 
Committee would extend the tariff on imported ethanol for 2 more years. 
The Gregg amendment properly repeals the tariff.
  Now, why do I say properly? Because the ethanol tariff acts as a tax 
on U.S. consumers at the gasoline pump. It increases the cost of 
gasoline because the cost of ethanol is increased due to the tariff. If 
Americans want anything out of this Energy bill, it is a reduction in 
gasoline prices.
  In fact, in a recent Associated Press poll, 60 percent of the 
respondents said that gas prices--which, by the way, are currently 
around $3 a gallon--are causing them hardships. Now, it is one thing to 
maybe have to pull back a little on your family vacation this summer, 
but an awful lot of people have to drive to get to work and have to 
drive as part of work. Clearly, when over half of Americans are caused 
hardships by the current high level of gasoline prices, Congress has 
the responsibility to do something about that.
  We should act. One of the few ways in which we can directly impact 
the price of gasoline at the pump is to eliminate the tariff of 54 
cents per gallon on ethanol that is brought into the United States. 
Nothing else in this bill will directly bring down gasoline prices. In 
fact, there are several provisions that will actually have the effect 
of increasing gasoline prices. Promoting a competitive market for 
ethanol will help bring down gasoline prices because it increases the 
supply that is available and provides, therefore, access to lower cost 
ethanol.
  The bottom line is this: When there is a supply of potential fuel out 
there and our companies are trying to find that supply so they can 
bring it into the United States to meet the demand of consumers, but 
they have to pay 54 cents a gallon on part of that supply, they are 
either going to buy the supply at 54 cents a gallon and pass the cost 
on to the consumer or they are not going to be able to do that, thereby 
reducing the supply of gasoline available. What happens when you have 
more demand and less supply? The cost goes up anyway. Either way, 
having this tariff in place causes an escalating cost of the price of 
gasoline because it reduces available supply to the American consumer.
  We have a mandate now to use ethanol. That is required. That mandate 
means the companies that provide the gasoline to consumers have no 
choice but to acquire ethanol. If much of that ethanol is abroad, and 
we are charging 54 cents a gallon for it, obviously, you can see it is 
going to increase the cost of gasoline for the American consumer. 
Americans are a competitive people who know how the free market works.
  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. GREGG. I yield 1 more minute to the Senator from Arizona.
  Mr. KYL. I need an additional 30 seconds, Mr. President.
  One way we know the free market can work better is if we don't have 
artificial prices on a product which the American consumer needs in 
order to work. That means we can reduce the cost of gasoline by 
eliminating this costly ethanol tariff.
  Mr. GREGG. Mr. President, could the Chair advise us as to the time 
situation?
  The PRESIDING OFFICER. Ten minutes.
  Mr. GREGG. Senator Grassley has how much time?
  The PRESIDING OFFICER. One minute.
  Mr. GREGG. Mr. President, I ask unanimous consent to add as 
cosponsors Senators Feinstein, Sununu, Kyl, and Ensign.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. GREGG. Mr. President, I think there is some inconsistency coming 
from the argument of the other side on this issue. There is the 
argument, well, reducing the 54-cent-a-gallon tax would not reduce the 
price of gasoline. That is very hard to sustain on its face; it is 
counterintuitive, for obvious reasons. If you cut the cost of gasoline 
54 cents a gallon, or if you cut the cost of ethanol 54 cents a gallon, 
obviously, the price of gasoline is going to go down.
  It is equally hard to defend that position when, within two sentences 
of that argument, you make the argument that the country is going to be 
flooded with low-cost ethanol.
  You can't have it both ways. As a practical matter, yes, this will 
reduce the price of gasoline. But that is because the ethanol blend 
will be more affordable in pricing gasoline, and that should be our 
goal, obviously, for the American consumer--to produce a more 
environmentally positive form of energy at a lower price.
  The second major argument made here is, we can't do this because it 
will assist the foreign producers over domestic producers, which is 
totally inconsistent with the bill itself. The bill requires that 36 
billion gallons of ethanol be produced by 2022. There is no way that 
does not mean our domestic production is going to expand dramatically 
to meet that obligation, so the bill already has in it the built-in 
obligation and requirements to expand domestic production, coupled with 
the fact there is a $3 billion subsidy already paid independent of the 
ethanol benefit, which is accruing to the corn-producing segment of our 
economy. A $3 billion subsidy for corn producers is paid directly, 
coupled with the fact that Midwestern-produced ethanol cannot be 
shipped to the east coast, so it is not a competition. We have to buy 
the ethanol off-coast because that is the only way we can get the 
ethanol efficiently and safely because ethanol cannot be shipped 
through pipelines.
  As a practical matter, this tariff is a holdover from a day when, 
yes, there may have been a fledgling industry in the ethanol community. 
Maybe there was some viability to it 5 years ago. But that is no longer 
the case. We have seen a significant increase in corn prices as a 
result of the expansion of ethanol use. We are going to continue to see 
a significant increase in corn production, in corn prices, because of 
continued ethanol use. The simple fact is, as other types of ethanol 
sources are brought on line, they are going to be brought on line at a 
competitive price. In fact, they may even be more competitive than 
corn. And that competitive price, and hopefully a way to ship it, will 
then be taken advantage of in the East and obviously be a benefit to 
the entire community of ethanol producers.
  The arguments being put forth are classic protectionist arguments, 
but they have no feet underneath them. They have no basis underneath 
them. Protectionism, to begin with, is a lousy idea, but it is 
especially a lousy idea when it is basically not accomplishing its 
goal.
  On the face of it, we know it is not accomplishing its goal. Again, 
the argument of the Senator from Iowa made this point for us when he 
said the 7 percent was being allowed in the country, and he had no 
problem with that. If he has no problem with 7 percent, then why not 
more, as a practical matter? As a practical matter, we are not 
competing with the Midwest, we are just trying to get a reasonable 
price for ethanol in the East.
  This tax--and that is what it is--on American consumers, on a product 
that we should be using, is totally inappropriate and cannot be 
justified on the basis of protecting a domestic industry, specifically 
corn production, in light of the economics of corn production in 
today's market--which is doing extraordinarily well. It is seeing a 
massive expansion. Its prices are at their highest level in recent 
memory. They are going to continue to expand because this bill requires 
that expansion with the requirement that we use 36 billion gallons of 
ethanol by 2022, which is almost a quadrupling of the amount of ethanol 
required today.
  I hope Members of the Senate would join me in voting to eliminate 
this unfair tax, this inappropriate tax. Down the road there is going 
to be an amendment to eliminate the blenders credit which would offset 
any of the revenues this would incur.
  I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.

[[Page S8009]]

  The yeas and nays were ordered.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, I yield myself the 1 minute I have left.
  First of all, there is no $3 billion to corn farmers, when corn is $4 
a bushel or $3.50 a bushel.
  Second, as to the point made by Senator Kyl, as well as Senator 
Gregg, that consumers want lower prices and somehow ethanol is driving 
up that price, let me tell you that ethanol today, this very day, if 
you check the market, is cheaper in the Northeast and the east coast 
than gasoline is. The spot market price for ethanol is $2.10 compared 
to the spot price for gasoline at $2.21 at the New York Harbor. There 
is no shortage of ethanol. There are no gasoline marketers unable to 
get ethanol supplies in the Northeast or the east coast. Ethanol is 
blended today in the RFT area, along the east coast, including Boston, 
New York, Philadelphia, Baltimore, and Washington. There is imported 
ethanol shipped into New York and Baltimore Harbor today.
  Mr. President, I ask unanimous consent to have printed in the Record 
a letter from seven agricultural groups, including the American Farm 
Bureau Federation and the National Farmers Union, in opposition to the 
Gregg amendment.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

     Majority Leader Harry Reid,
     U.S. Senate.
     Chairman Jeff Bingaman,
     Committee on Energy and Natural Resources, U.S. Senate.
     Minority Leader Mitch McConnell,
     U.S. Senate.
     Ranking Member Pete Domenici,
     Committee on Energy and Natural Resources, U.S. Senate.
       Dear Senators: Senator Judd Gregg (R-NH) is proposing an 
     amendment to the energy bill that would eliminate the current 
     tariff on imported ethanol. Such a change is not only unfair, 
     but also inconsistent with efforts by the Administration and 
     Congress to promote the growth of domestically produced 
     renewable fuels.
       Current U.S. policy provides refiners and gasoline 
     marketers a 51 cents per gallon tax credit for every gallon 
     of ethanol blended into gasoline. This tax credit is 
     available to refiners regardless of whether the ethanol 
     blended is imported or domestic. To prevent U.S. taxpayers 
     from subsidizing foreign ethanol companies, Congress passed 
     an offset to the tax credit that foreign companies pay in the 
     form of a tariff.
       Clearly, companies in countries--like Brazil--that 
     subsidize their own ethanol industry should not have an 
     unfair advantage over U.S. companies. The tax credit offset 
     results in a level playing field and allows a system of fair 
     trade to operate.
       The tax credit offset on imported ethanol is not a barrier 
     to entry. In 2006, for example, the U.S. imported of 650 
     million gallons of which more than 430 million gallons came 
     from Brazil. Clearly, Brazilian imports compete quite 
     effectively when needed.
       Simply put, the credit offset merely asks Brazilian and 
     other foreign ethanol producers to pay back the tax incentive 
     for which their product is eligible. Congress correctly put 
     this offset in place to prevent foreign ethanol industries 
     access to American taxpayer dollars while not preventing 
     access to the U.S. market.
       At a time when America's domestic ethanol industry is 
     seeking to expand, to invest in new technologies, and to 
     attract investment in cellulosic ethanol production capacity, 
     it makes little sense to undercut those efforts by 
     eliminating the tax credit offset on ethanol. We strongly 
     urge a ``NO'' vote on the Gregg amendment to subsidize 
     foreign produced ethanol.
           Sincerely,
       American Coalition for Ethanol.
       American Farm Bureau Federation.
       National Corn Growers Association.
       National Council of Farmer Cooperatives.
       National Farmers Union.
       National Sorghum Producers.
       Renewable Fuels Association.

  Mr. GREGG. Mr. President, before we go to the vote, I want to clarify 
two things. First, there was an implication that the administration 
might not support this amendment. In fact, the administration supports 
the repeal of this tariff, and they openly supported it. They were on 
record as supporting it when they were negotiating with Brazil. They do 
support the repeal of this tariff.
  Mr. GRASSLEY. Will you yield on this point, please, not to make a 
statement?
  Mr. GREGG. Yes, to ask a question.
  Mr. GRASSLEY. Mr. President, I do ask this question: Does the Senator 
from New Hampshire know that the President of the United States, when 
he was in Brazil, was quoted in the paper as telling President Lulu 
that the ethanol export--the import credit would not be repealed while 
he is President of the United States?
  Mr. GREGG. Reclaiming my time----
  Mr. GRASSLEY. I asked you a question.
  Mr. GREGG. I am happy to say that I did not understand the question. 
If I did understand the question, I believe it was that the President 
said he would not repeal the ethanol credit during his time in office, 
which I don't happen to think is the administration's position, which 
was that they publicly do not support this tariff. They do not support 
this excessive tariff; they do not support this tax. This 
administration has a strong record on opposition to taxes and tariffs, 
and they have been publicly in opposition to this for a while.
  I also ask unanimous consent to add Kay Bailey Hutchison as a 
cosponsor.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. GREGG. I ask unanimous consent to have a statement from the 
Taxpayers for Common Sense in support of the amendment printed in the 
Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                            Taxpayers for Common Sense Action,

                                    Washington, DC, June 19, 2007.
       Dear Senator: Taxpayers for Common Sense Action urges you 
     to support Senator Judd Gregg's (R-NH) second degree 
     amendment to the Senate Finance Committee's amendment on H.R. 
     6. This amendment would eliminate the 54 cent per gallon 
     tariff on imported ethanol, and it is an important first step 
     in righting our flawed ethanol policies.
       The combination of ethanol tariffs and a domestic tax 
     credit for blenders of ethanol wildly distorts the 
     marketplace, artificially propping up a narrow sector of the 
     farm economy and stiffing consumers in the process.
       The Gregg amendment opens U.S. markets to additional 
     sources of ethanol that would lower domestic prices. Two Iowa 
     State University economists estimate that removing the 
     existing ethanol duties would reduce the domestic price of 
     ethanol by 13.6 percent. Taken one step further, if the 
     blender's tax credit were also repealed, the domestic price 
     of ethanol would drop by a total of 18.4 percent, according 
     to their estimations.
       Taxpayers for Common Sense Action urges you to vote for 
     Senator Gregg's amendment to the Senate Finance Committee 
     amendment that is expected to be attached to H.R. 6.
           Sincerely,
                                                   Ryan Alexander,
                                                        President.

  Mr. GREGG. I yield the remainder of my time and suggest we go to the 
vote.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. I raise a point of order that the pending amendment 
violates section 201 of S. Con. Res. 21, the concurrent resolution on 
the budget for fiscal year 2008.
  Mr. GREGG. Mr. President, pursuant to section 904(c) of the 
Congressional Budget Act of 1974, I move to waive section 201 of S. 
Con. Res. 21, the fiscal year 2008 budget resolution, for consideration 
of H.R. 6.
  I ask for the yeas and nays.
  The PRESIDING OFFICER. The question is on agreeing to the motion. Is 
there a sufficient second?
  There is a sufficient second.
  The clerk will call the roll.
  The bill clerk called the roll.
  Mr. DURBIN. I announce that the Senator from Delaware (Mr. Biden), 
the Senator from South Dakota (Mr. Johnson), the Senator from Illinois 
(Mr. Obama), and the Senator from Rhode Island (Mr. Whitehouse), are 
necessarily absent.
  I further announce that, if present and voting, the Senator from 
Rhode Island (Mr. Whitehouse) would vote ``yea.''
  Mr. LOTT. The following Senators are necessarily absent: the Senator 
from Kansas (Mr. Brownback), the Senator from Oklahoma (Mr. Coburn), 
and the Senator from Arizona (Mr. McCain).
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The yeas and nays resulted--yeas 36, nays 56, as follows:

                      [Rollcall Vote No. 218 Leg.]

                                YEAS--36

     Alexander
     Allard
     Bennett
     Boxer
     Bunning
     Burr
     Cantwell
     Collins
     Corker
     Cornyn
     DeMint
     Dole
     Ensign
     Enzi
     Feinstein
     Graham
     Gregg
     Hutchison
     Inhofe
     Kennedy
     Kyl
     Lautenberg
     Leahy
     Lieberman
     Lott
     Lugar
     Martinez

[[Page S8010]]


     Menendez
     Nelson (FL)
     Reed
     Schumer
     Shelby
     Snowe
     Sununu
     Warner
     Webb

                                NAYS--56

     Akaka
     Baucus
     Bayh
     Bingaman
     Bond
     Brown
     Byrd
     Cardin
     Carper
     Casey
     Chambliss
     Clinton
     Cochran
     Coleman
     Conrad
     Craig
     Crapo
     Dodd
     Domenici
     Dorgan
     Durbin
     Feingold
     Grassley
     Hagel
     Harkin
     Hatch
     Inouye
     Isakson
     Kerry
     Klobuchar
     Kohl
     Landrieu
     Levin
     Lincoln
     McCaskill
     McConnell
     Mikulski
     Murkowski
     Murray
     Nelson (NE)
     Pryor
     Reid
     Roberts
     Rockefeller
     Salazar
     Sanders
     Sessions
     Smith
     Specter
     Stabenow
     Stevens
     Tester
     Thune
     Vitter
     Voinovich
     Wyden

                             NOT VOTING--7

     Biden
     Brownback
     Coburn
     Johnson
     McCain
     Obama
     Whitehouse
  The PRESIDING OFFICER. On this vote, the yeas are 36, the nays are 
56.
  Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected. The point of order is 
sustained and the amendment falls.
  The Senator from New Mexico.


    Amendments Nos. 1528, 1529, 1533, and 1551, As Modified, En Bloc

  Mr. BINGAMAN. Mr. President, Senator Domenici and I have been working 
to get some amendments cleared. There are four that are now cleared.
  I ask unanimous consent that it be in order to consider en bloc the 
following amendments, that they be considered and agreed to en bloc, 
and that the motions to reconsider be laid upon the table en bloc: 
Bingaman-Domenici No. 1528; Bingaman-Domenici No. 1529; Menendez No. 
1533; and Cantwell No. 1551, as modified with the changes that are at 
the desk.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendments were agreed to, as follows:


                           amendment no. 1528

      (Purpose: To improve the section relating to energy storage 
                            competitiveness)

       On page 126, line 12, strike ``and''.
       On page 126, line 13, strike the period and insert ``; 
     and''.
       On page 126, between lines 13 and 14, insert the following:
       (vi) thermal behavior and life degradation mechanisms.
       On page 126, strike lines 14 through 21, and insert the 
     following:
       (B) Nanoscience centers.--The Secretary, in cooperation 
     with the Council, shall coordinate the activities of the 
     nanoscience centers of the Department to help the nanoscience 
     centers of the Department maintain a globally competitive 
     posture in energy storage systems for motor transportation 
     and electricity transmission and distribution.
       On page 127, line 5, insert ``and battery systems'' after 
     ``batteries''.
       On page 127, line 7, strike ``and''.
       On page 127, line 9, strike the period and insert   ``; 
     and''.
       On page 127, between lines 9 and 10, insert the following:
       (G) thermal management systems.
       On page 127, line 12, insert ``not more than'' before 
     ``4''.
       On page 127, lines 21 and 22, strike ``and the Under 
     Secretary of Energy''.
       Beginning on page 128, strike line 22, and all that follows 
     through page 129, line 2 and insert the following:
       (7) Disclosure.--Section 623 of the Energy Policy Act of 
     1992 (42 U.S.C. 13293) may apply to any project carried out 
     through a grant, contract, or cooperative agreement under 
     this section.
       (8) Intellectual property.--In accordance with section 
     202(a)(ii) of title 35, United States Code, section 152 of 
     the Atomic Energy Act of 1954 (42 U.S.C. 2182), and section 9 
     of the Federal Nonnuclear Research and Development Act of 
     1974 (42 U.S.C. 5908), the Secretary may require, for any new 
     invention developed under paragraph (6)--
       (A) that any industrial participant that is active in a 
     Energy Storage Research Center established under paragraph 
     (6) related to the advancement of energy storage technologies 
     carried out, in whole or in part, with Federal funding, be 
     granted the first option to negotiate with the invention 
     owner, at least in the field of energy storage technologies, 
     nonexclusive licenses and royalties on terms that are 
     reasonable, as determined by the Secretary;
       (B) that, during a 2-year period beginning on the date on 
     which an invention is made, the patent holder shall not 
     negotiate any license or royalty agreement with any entity 
     that is not an industrial participant under paragraph (6);
       (C) that, during the 2-year period described in 
     subparagraph (B), the patent holder shall negotiate 
     nonexclusive licenses and royalties in good faith with any 
     interested industrial participant under paragraph (6); and
       (D) such other terms as the Secretary determines to be 
     necessary to promote the accelerated commercialization of 
     inventions made under paragraph (6) to advance the capability 
     of the United States to successfully compete in global energy 
     storage markets.
       On page 129, line 3, strike ``(7)'' and insert ``(9)''.
       On page 129, line 4, strike ``5 years'' and insert ``3 
     years''.
       On page 129, line 8, strike ``in making'' and all that 
     follows through the end of the paragraph and insert ``in 
     carrying out this section.''.
       On page 129, line 12, strike ``(8)'' and insert ``(10)''.


                           amendment no. 1529

(Purpose: To require the Administrator of General Services to submit an 
            annual report to the Energy Information Agency)

       On page 73, between lines 4 and 5, insert the following:
       (h) Report.--Not later than 2 years after the date of 
     enactment of this Act, and annually thereafter, the 
     Administrator of General Services shall submit to the Energy 
     Information Agency a report describing the quantity, type, 
     and cost of each lighting product purchased by the Federal 
     Government.
       On page 73, line 5, strike ``(h)'' and insert ``(i)''.
       On page 73, line 16, strike ``(i)'' and insert ``(j)''.


                           amendment no. 1533

  (Purpose: To make the Commonwealth of Puerto Rico eligible for the 
                    Federal weatherization program)

       At the end of subtitle F of title II, insert the following:

     SEC. 2__. DEFINITION OF STATE.

       Section 412 of the Energy Conservation and Production Act 
     (42 U.S.C. 6862) is amended by striking paragraph (8) and 
     inserting the following:
       ``(8) State.--The term `State' means--
       ``(A) a State;
       ``(B) the District of Columbia; and
       ``(C) the Commonwealth of Puerto Rico.''.


                    amendment no. 1551, as modified

       On page 161, between lines 2 and 3, insert the following:

     SEC. 269. FEDERAL STANDBY POWER STANDARD.

       (a) Definitions.--In this section:
       (1) Agency.--
       (A) In general.--The term ``Agency'' has the meaning given 
     the term ``Executive agency'' in section 105 of title 5, 
     United States Code.
       (B) Inclusions.--The term ``Agency'' includes military 
     departments, as the term is defined in section 102 of title 
     5, United States Code.
       (2) Eligible product.--The term ``eligible product'' means 
     a commercially available, off-the-shelf product that--
       (A)(i) uses external standby power devices; or
       (ii) contains an internal standby power function; and
       (B) is included on the list compiled under subsection (d).
       (b) Federal Purchasing Requirement.--Subject to subsection 
     (c), if an Agency purchases an eligible product, the Agency 
     shall purchase--
       (1) an eligible product that uses not more than 1 watt in 
     the standby power consuming mode of the eligible product; or
       (2) if an eligible product described in paragraph (1) is 
     not available, the eligible product with the lowest available 
     standby power wattage in the standby power consuming mode of 
     the eligible product.
       (c) Limitation.--The requirements of subsection (b) shall 
     apply to a purchase by an Agency only if--
       (1) the lower-wattage eligible product is--
       (A) lifecycle cost-effective; and
       (B) practicable; and
       (2) the utility and performance of the eligible product is 
     not compromised by the lower wattage requirement.
       (d) Eligible Products.--The Secretary of Energy, in 
     consultation with the Secretary of Defense, the Administrator 
     of the Environmental Protection Agency, and the Administrator 
     of General Services, shall compile a publicly accessible list 
     of cost-effective eligible products that shall be subject to 
     the purchasing requirements of subsection (b).

  Mr. MENENDEZ. Mr. President, I rise in support of including Puerto 
Rico in the Federal Weatherization Assistance Program. I want to thank 
Chairman Jeff Bingaman and Ranking Member Pete Domenici for accepting 
this amendment as part of the CLEAN Energy Act of 2007. This is simply 
a matter of fairness and of equity.
  Puerto Rico is currently ineligible for Weatherization Assistance, 
and only receives a small set aside from the LIHEAP program. To include 
Puerto Rico in the weatherization program would cost less than 1 
percent of the program's funds but would make a huge impact.
  Though Puerto Rico is blessed with warm weather, the Weatherization 
Assistance Program is desperately needed there. Because it is an island 
that must import the fuels it needs, energy costs are extraordinarily 
high. The average cost of electricity in the U.S. is under 10 cents a 
kilowatt-hour, but in Puerto Rico, electricity costs almost twice that 
at 18 cents per kilowatt-hour.

[[Page S8011]]

  And these high energy costs have a devastating impact on the 
Commonwealth's low-income population. Approximately 45 percent of the 
population is under the U.S. poverty line.
  Many homes rely on old, inefficient air conditioners to cool their 
homes and much of the low-income housing has not been built or 
maintained with energy efficiency in mind.
  Puerto Rico already has an active program to educate people about the 
importance of energy efficiency and to increase the energy efficiency 
of government buildings. But the weatherization program would help 
Puerto Rico offer weatherization assistance to low-income households 
and incentives for energy efficient appliance purchases, solar water 
heaters, lighting replacement, and other energy-saving measures.
  The CLEAN Energy Act of 2007 expands authorization for the 
Weatherization Program from $700 million per year to $750 million per 
year. This vital program helps thousands of low-income families keep 
their energy costs down and also helps the environment by making energy 
consumption more efficient. It is time we help the low-income families 
of Puerto Rico gain access to this vital program.
  I again thank Chairman Jeff Bingaman and Ranking Member Pete Domenici 
for their leadership in accepting this critical amendment.
  Mr. BINGAMAN. Mr. President, I believe the order now is for the 
Senator from New York who wishes to offer an amendment. I yield to my 
colleague to see if he is in agreement with that course of action.
  Mr. DOMENICI. I am. I say to Senator Schumer, we had no objection to 
your amendment. It took an extra amount of time because of matching up 
one versus one side and the other. It was nothing fundamental. It was 
just that.
  Mr. SCHUMER. Mr. President, if my colleague will yield, I thank him 
for that. If we can accept the amendment, I don't have to debate it. 
Are we able to do that or are we still able to match up?
  Mr. BINGAMAN. Mr. President, I think the better course is for the 
Senator from New York to go ahead and explain the amendment, offer the 
amendment. Then during the course of his debate, we will see how 
persuaded we are and whether a voice vote is adequate or whether a 
rollcall vote is required.
  Mr. SCHUMER. I thank the Senator.
  The PRESIDING OFFICER. The Senator from New York.
  Mr. SCHUMER. I thank both my colleagues from New Mexico. They put a 
big burden on me to make a good explanation. I will do my best.
  I ask unanimous consent that the pending amendment be set aside so I 
may call up my amendment which would then be set aside when I am 
through.
  The PRESIDING OFFICER. Is there objection?
  Mr. DOMENICI. I have to object to your bringing up the amendment.
  Mr. SCHUMER. Then I withdraw the request, and I will speak about the 
amendment without bringing it up.
  The amendment we are speaking about here would raise the level of 
building standards so that our buildings across America would be more 
green. There has been tremendous focus on automobiles--of course, there 
should be--in raising their mileage standards. But what is forgotten is 
that a huge percentage of energy consumption and greenhouse gases come 
from buildings and, more importantly, the heating and cooling of our 
structures, both residential and commercial. The bottom line is, if 
everybody in America were to adopt green building standards, we could 
greatly reduce--and these are prospective, not retrospective--the 
amount of greenhouse gases and energy consumption.
  For instance, according to the Alliance to Save Energy, the amendment 
I wish to offer could save our country 5 percent of its total energy 
use, save consumers $50 billion a year, and--listen to this, this is an 
amazing statistic--reduce greenhouse gas emissions by an amount 
equivalent to taking 70 million cars off the road.
  You say: Can this work? Yes, because a good number of States have 
started doing this already. California has taken the lead. California 
increased its energy efficiency in buildings in the late 1970s, and now 
they, in terms of greenhouse gases, are at the level of some European 
countries, even though California is a car culture. There are lists of 
States that have already moved forward in this regard. They are 
California, Colorado, Connecticut, Hawaii, Minnesota, Nevada, 
Pennsylvania, Texas, Vermont, Virginia, and Washington, and other 
States are on the road to doing so. The bottom line is, by making our 
buildings more efficient, we can reduce gases.
  Let me tell you what the amendment does. The organizations that draft 
commercial and residential building codes will be required to meet 
specific energy use targets. We don't tell them how. Obviously, it is 
different in Minnesota than it would be in Florida or Arizona. They 
will be required to meet specific energy use targets. They must be more 
efficient by 30 percent than the 2006 codes by 2015 and 50 percent more 
efficient by 2022. Because this affects new buildings, obviously people 
are given a timeline. You can't start this next year. But, again, 
California did this in the 1970s, and they are reaping the benefits 
now.
  Since energy independence and since global warming are long-term 
issues--we all know we are not going to solve them in a year--acting 
now is important. We give the States time to change their building 
codes in the way they wish, and we would greatly reduce the amount of 
greenhouse gases.
  My mayor is in the news today but for other matters. The mayor of New 
York City, for instance, has proposed that the city do this on its own. 
We give credit to specific cities that would do this as well. They 
would have the same benefits and responsibilities under the bill as 
States would, when States did it. If your State didn't but your city 
did, you would still be able to get the benefits and meet the 
requirements of the legislation. But it is estimated that it will 
reduce the amount of energy consumption in New York City by 40 percent. 
Is that incredible?
  We have a lot of debate, as we should, on automobiles, on renewables, 
on coal to gas, but there is a quiet little secret out there that this 
amendment sort of makes public. That is that conservation--conservation 
of things that are much easier and much less controversial than, say, 
automobiles--is where the real bang for the buck is in terms of energy 
independence, reducing greenhouse gases, and in terms of lowering the 
cost to the average consumer of electricity and gasoline, because when 
we are more efficient in terms of our buildings, petroleum is used for 
other purposes, and supply and demand would even reduce the price for 
gasoline.
  One of the environmentalists I know put it well. He said: Alternative 
fuels are the sizzle and conservation is the steak. They are both 
important. When you barbecue, you like to have the sizzle. It is fun. 
But you also like to eat the steak.
  I have two other amendments, one that does the same on appliances. 
The bill has good provisions on appliances, but we move them further in 
terms of California, although I am not talking about that one here 
right now.
  If we were to do it for utilities, where we would require them to be 
more efficient--and they could choose the way--we could do dramatic 
things in this bill just on its own. The cost for most energy 
conservation, the cost for reducing the consumption of petroleum, for 
reducing greenhouse gas emissions, is about one-quarter what it is for 
producing new alternative fuels.
  I hope my colleagues will support this amendment. It is not 
controversial, I do not think. It does not have universal support, but 
it has great support. The Department of Energy has looked favorably 
upon it. I do not know if they are officially in favor of it, but we 
talked to them, and they know we have to move in this direction.
  I hope the amendment can be adopted. I hope I have convinced my 
colleague from New Mexico, if not with eloquence--which I am sure I do 
not have--at least with the facts and the structure of this amendment.
  Mr. President, I am happy to yield back the floor, unless my 
colleague wishes me to go on further about this amendment.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. BINGAMAN. Mr. President, I thank my colleague from New York. He 
has persuaded me of the merit of his

[[Page S8012]]

amendment, but I am not in a position to procedurally move to actual 
disposition of the amendment at this time.
  So if the Senator has completed his statement, I suggest the absence 
of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. BINGAMAN. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 1704

  Mr. BINGAMAN. Mr. President, since we seem to be unable to move ahead 
and actually dispose of amendments for a few minutes, while we get the 
procedural circumstance untangled, let me speak briefly about the tax 
package that has been reported from the Finance Committee.
  The energy tax package that is now a pending amendment to this bill 
represents a dramatic shift in the direction of our national energy 
policy from fossil fuel dependence to one that promotes diversified 
domestic sources of clean energy.
  The package the Senate will consider as part of this tax package 
contains three times the incentives for energy efficiency and 
renewables and other clean energy than we were able to enact in the 
2005 Energy bill--three times more clean energy.
  The energy tax provisions are intended to complement and augment the 
authorizing legislation. These vitally important energy measures 
include:
  First, a 5-year extension of the section 45 tax credit for producing 
electricity from wind, geothermal, biomass, and other green resources; 
an extension of the section 48 investment tax credit for business 
investments in solar, fuel cells, and microturbines for a total of 8 
years in the package that has now been reported to the Senate; 
extending the newly proposed residential wind credit; extending several 
residential and commercial energy efficiency tax incentives; expanding 
the section 48 A and B investment tax credits to fund the development 
of clean coal facilities, with a particular requirement that 
CO2 be captured and sequestered; expanding the program for 
clean renewable energy bonds by up to $3.6 billion; adding $3 billion 
to a newly established program for clean coal bonds; extending the 
advanced vehicle consumer credits and adding a category for plug-in 
hybrids and electric vehicles; and an important new incentive to 
encourage the production of cellulosic ethanol.
  These are important provisions individually, but combined I think 
they will play a major role in moving our country along toward a path 
of forward-looking energy policy.
  The Finance Committee amendment also contains a severance tax on all 
oil and gas production from the Federal Outer Continental Shelf in the 
Gulf of Mexico. This severance tax proposal needs to be viewed in the 
context of the larger energy tax title in the Energy bill that is 
before the Senate. By including this OCS severance tax in the Energy 
tax bill, we are able to secure the revenue that is vitally needed for 
these energy measures I have detailed.
  This OCS severance tax has been carefully crafted to raise revenues 
while doing the least possible to discourage production. First of all, 
it applies to oil and gas production on the OCS in the Gulf of Mexico 
only. We carefully considered where the tax should apply. The Alaska 
OCS is an important frontier area, and additional costs on those 
operations could truly impact leasing and development activity. The 
only other area with production in the OCS is California, where 
production is minimal and no new leasing is occurring.
  However, the industry in the Gulf of Mexico is robust--particularly 
with the price of oil where it is today--and the lessees and operators 
there tend to be large: either the major oil companies or large 
independent producers. This is in contrast to the Rocky Mountain 
region, where many small independents operate. Additional taxes or fees 
in that region could make the difference between production occurring 
or not occurring. Thus, this tax would only apply to oil and gas from 
the Gulf of Mexico Outer Continental Shelf.
  In addition, the tax is designed to ensure that it is not overly 
burdensome. The tax would be levied at a rate of 13 percent of the 
value of production with a credit against the tax for royalties paid on 
each lease. The Government Accountability Office recently completed a 
study comparing the combined tax and royalty costs imposed on the oil 
and gas industry in the United States versus elsewhere in the world.

  I note the GAO found the climate for doing business in the U.S. is 
very favorable, with the U.S. having one of the lowest combined 
``government takes'' in the world. Using this construct of considering 
the combined tax and royalty costs, we designed the severance tax with 
a credit for royalties paid to ensure no lessee would be required to 
pay more than 13 percent of the value of their production in combined 
severance taxes and royalties.
  Of course, any lessee who is paying a 16\2/3\-percent royalty--that 
the President has now established as the appropriate royalty on Federal 
leases going forward--any lessee that is subject to that royalty will 
pay no tax. Any lessee paying a 12.5-percent royalty will pay an 
effective rate of 0.5 percent for the severance tax, and lessees paying 
less than a 12.5-percent royalty rate will pay the tax at an effective 
rate of the difference between the 13 percent and the royalty rate 
being paid.
  Furthermore, I believe the 13-percent tax rate is extremely 
reasonable. Earlier this year, the White House did announce the royalty 
rate for all new leases in the Gulf of Mexico would contain terms 
requiring that royalties be paid at a rate of 16\2/3\ percent. This was 
met with little, if any, opposition from the industry.
  Again, I commend Senators Grassley and Baucus. Senator Baucus has 
been our leader on this issue from the beginning of putting this entire 
package together. He and his staff have done yeoman's work. I also have 
been proud of the work my staff has done on this important issue as 
well.
  Mr. President, with that, I yield the floor and suggest the absence 
of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. CASEY. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Menendez). Without objection, it is so 
ordered.
  Mr. CASEY. Mr. President, I ask unanimous consent that I be 
recognized to speak as in morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                        Employee Free Choice Act

  Mr. CASEY. Mr. President, I rise to talk about a matter that is 
before the Senate, the Employee Free Choice Act. In summary, what this 
act will do is--and I have three brief points about the act itself--it 
will enable workers to form unions when a majority sign union 
authorization cards. Second, it will establish mediation and binding 
arbitration when the employer and workers cannot agree on a first 
contract. Third, it will strengthen penalties for companies that coerce 
or intimidate workers.
  We know today what we are facing in our economy. We have rising 
levels of productivity, thank goodness, but at the same time 
productivity has been up and our workers have been more productive than 
ever, our wages have not kept pace. Salaries and wages have not grown 
the way productivity has.
  We know that so many more of our working families have had to suffer 
that disparity, that gap between productivity and wages and benefits.
  I think a lot of Americans believe the freedom to choose a union is 
vital to restoring the American dream, especially for the most 
vulnerable Americans. Unfortunately, vulnerable Americans now include 
working families.
  Unions help American workers get their fair share, as you well know, 
Mr. President, in your State, as well as in my State of Pennsylvania. 
Union wages are almost 30 percent higher than wages in nonunion fields. 
Unions are also a cure for rising inequality because they raise wages 
for more low- and middle-income wage earners, more so than for higher 
wage workers.
  For example, if we talk about some lower wage occupations, cashiers, 
for example, earn 46 percent more than nonunion cashiers and those 
covered by unions, 46 percent more.

[[Page S8013]]

  Union food preparation workers earn nearly 50 percent more than 
nonunion food preparation workers.
  I will share a couple of demographic categories. Women, for example, 
who are represented by a union earn 31 percent more than women workers 
who do not have the benefit of a union. African-American union workers 
earn 36 percent more than their nonunion counterparts. Latino workers 
earn 46 percent more than those Latinos who are not represented by a 
union. Finally, union workers are almost twice as likely to have 
employer-sponsored health benefits and pensions at work--twice as 
likely--than their counterparts who do not have union protection. They 
are more than four times likely to have a secure and defined pension 
benefit plan than nonunion workers.
  Protecting the freedom to choose a union benefits all Americans, and 
I believe this in my bones, as we all do who support this act. Whether 
someone has a union I think raises and lifts all boats. In industries 
and occupations where many workplaces are unionized, nonunion employers 
will frequently meet union standards, lift their sights, so to speak, 
and otherwise improve compensation. A high school graduate in a 
nonunion workplace whose industry is 25 percent unionized gets paid 5 
percent more than similar workers in less unionized industries.
  We know what this act can mean for workers and their families to 
raise their standard of living, in wages and benefits and other parts 
of their compensation, but also I believe this act is about America. We 
know the unions, the right to organize and selectively bargain, helped 
build the American middle class over decades, when those who said at 
the beginning of those fights this is not a good idea.
  What we will do by passing this legislation that is before the Senate 
is to move to a new chapter where more and more of our families can 
have the benefit of union protection so they can live in a country 
where their work, their labor, and the fruits of their labor is 
recognized.
  I ask all of my colleagues respectfully, as they consider this 
legislation, to think not only of what this will do for our unions and 
families who are covered by those unions but what it does for all 
America, for all our collective interests in a stronger economy. I ask 
their consideration of this bill.
  I know, Mr. President, you and so many others have been leading the 
fight on this effort, and we are grateful for that leadership, for our 
families, and for our country.
  I am proud to be an original cosponsor of the bill, and think that it 
is a vital part of an agenda aimed at restoring a balance to our 
Nation's labor policies and alleviating the insecurity felt by so many 
American families.
  The bill, if passed, would enable workers to form unions when a 
majority sign union authorization cards, establish mediation and 
binding arbitration when the employer and workers cannot agree on a 
first contract, and strengthen penalties for companies that coerce or 
intimidate workers.
  These changes to our labor laws are quite frankly vital to the 
preservation of the American middle class, because unions, which were a 
driving force in the creation of that middle class, are also one of the 
best tools we have to protect it.
  We live in a remarkable time, when corporate profits are rising, 
largely because of the rising productivity of the American worker. At 
the same time, corporations in America are receiving unprecedented 
access to foreign markets because of our nation's trade policies. But 
while we are working to give corporations that access, we must work to 
ensure that workers have rights and protections, and opportunities in 
the new global economy that is emerging. After all, families are made 
up of workers, not corporations.
  Unfortunately, workers are being left behind in large part because we 
have stripped them of rights and protections and made it ever harder 
for them to organize in a union if they wish to do so. The effects of 
this are dramatic, and are changing the economic landscape of America. 
At a time when productivity has been rising and companies are making 
huge profits on the backs of their workers, workers' salaries are not 
increasing.
  Corporate profits are up by more than 83 percent since 2001. Yet the 
share of national income going to wages and salaries in 2006 was at its 
lowest level on record. The share of national income captured by 
corporate profits, in contrast, was at its highest level on record. 
Some 51.6 percent of total national income went to wages and salaries 
in 2006.
  Today, more than 40 percent of total income is going to the 
wealthiest 10 percent of Americans--the biggest gap in more than 65 
years. The share of pretax income in the Nation that goes to the top 1 
percent of households increased from 17.8 percent in 2004 to 19.3 
percent in 2005.
  Between 2004 and 2005, the average income of the top 1 percent of 
households increased by $102,000, after adjusting for inflation. The 
average income of the bottom 90 percent of households increased by 
$250.
  It is bad enough that wages aren't rising for the vast majority of 
Americans, but to make matters worse, the costs they face in their 
daily lives are rising, sometimes with life and death consequences. Six 
million Americans have lost their health insurance, and their 
retirement security is fading as well. It doesn't make sense that at a 
time when corporate balance sheets are so healthy, Americans are being 
forced to go without basic health care. In fact, we all know that that 
will have the effect of reducing our productivity, and profits, if we 
don't address it.
  That is why I support the Employee Free Choice Act. The freedom to 
choose a union is vital to restoring the American Dream, especially for 
the most vulnerable Americans. Union workers are far more likely to 
have health care benefits, and pensions that will actually provide for 
them in retirement.
  Unions help American workers get their fair share--union wages are 
almost 30 percent higher than nonunion wages. Unions are also a cure 
for rising inequality because they raise wages more for low- and 
middle-wage workers than for higher wage workers. Unions can also help 
the American worker weather the storm of globalization, and the 
displacement and insecurity that it has brought to some many families.
  Just this week, the OECD, which is known for its unapologetic 
promotion of free trade, released a report that highlighted the fact 
that countries should focus on improving labor regulations, for 
workers, not just companies, and social protection systems to help 
people adapt to changing job markets.
  The report also found that offshoring may have reduced the bargaining 
power of workers, especially low-skilled ones and that the prospect of 
offshoring may be increasing the vulnerability of jobs and wages in 
developed countries. That is an amazing finding from an organization 
devoted to promoting free trade.
  The OECD also found that in 18 of the 20 OECD countries where data 
exist, the gap between top earners and those at the bottom has risen 
since the early 1990s. The inequality in the United States was higher 
than all of those countries by a large margin, save one, Hungary.
  The Commonwealth of Pennsylvania, which I represent here, was built 
on stable union jobs, and the industries that employed those union 
workers helped to build America as we know it today. Pennsylvania steel 
can be found in every corner of the country, but unfortunately most of 
the plants that made that steel are now closed, and most of the union 
jobs that were the engine of those plants are gone.
  But that is what makes this legislation so important here and now. We 
need to act quickly to give American workers a leg up in this global 
economy, and create jobs that add value to workers' lives, to their 
communities, and to the American economy. We can't do that if we only 
reward capital. Capital can now flow over borders and across the world 
like never before. But our workers and families remain, and so we must 
stand with them and give them the tools they need to continue to be 
productive and competitive in this global economy. Workers from 
Pennsylvania can compete, but only if we give them a level playing 
field and the proper tools. This legislation takes one step to do just 
that, and that is why I support it.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.

[[Page S8014]]

  The assistant legislative clerk proceeded to call the roll.
  Mrs. HUTCHISON. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mrs. HUTCHISON. Mr. President, I rise today to speak in opposition to 
the tax part of this energy bill. I think it is common sense that if 
you tax something, the price will probably go up because the higher 
business costs are passed on to the consumer at some point.
  This is a tax bill that is $29 billion of new taxes. How could 
anything make less sense when we are trying to pass an energy bill that 
will do two things: make America less dependent on foreign oil for our 
energy needs, and bring the price of gasoline down at the pump. This 
bill, with the tax part, is not going to do either of those things.
  In the past 2\1/2\ years, the average price of a gallon of gas has 
risen about 68 percent due to increased demand in America and around 
the world. The price increase has harmed American families, and 
businesses, especially small businesses, and higher taxes are going to 
mean a higher price at the pump.
  Mr. President, I am going to suggest the absence of a quorum for just 
one moment.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mrs. HUTCHISON. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mrs. HUTCHISON. Mr. President, we must address the tax issue. There 
are some good parts in this energy package. This energy package could 
increase conservation. It could increase the supply of renewable energy 
sources. I have an amendment that I think is very positive which would 
provide for more research into new sources of energy, and there are all 
kinds of renewable, environmentally safe energy possibilities. Yet we 
have now put a tax bill in this bill which has just gone through 
committee. It came out yesterday, and we are going to, I am afraid, 
make the mistake that Congress has made before.
  In 1980, Congress passed a windfall profits tax. The consequences to 
the domestic oil industry, to consumers, and to our national security 
were devastating. In the 6 years that followed that action, domestic 
oil production dropped by 1.26 billion barrels, and imports of foreign 
oil rose 13 percent. Today, 60 percent of our oil comes from foreign 
countries. The collapse of the domestic oil and gas industry had a 
ripple effect on other sectors of the economy, especially banking and 
real estate.
  The windfall profits tax was terrible for this country, and it was 
repealed. Now we have a tax bill that will have the same effect, with 
$29 billion in taxes on energy production.
  Let's go through those. A repeal of the manufacturer's deduction for 
refineries: everyone who has looked at the energy crisis knows it is 
the lack of refinery capacity that has driven up the demand while we 
have not driven up the supply. We are making it harder to invest in 
refineries. No one is doing it, and we need more refineries. So taking 
away any deductions for refineries is counterintuitive.
  We would establish an excise tax of 13 percent on crude oil and 
natural gas produced in the Gulf of Mexico. That is the biggest source 
of oil and natural gas production in our country that we are able to 
produce and explore. ANWR would be larger, but we have not been able to 
tap into ANWR. So the Gulf of Mexico is our best source.
  Other States are now looking at exploring and then possibly drilling 
off their shores because there is now an opportunity for States to get 
revenue, and it can be done environmentally safely. So now we are 
talking about increasing the tax, which is going to have the effect of 
lessening the exploration and drilling and will also go back on a 
contract that was made earlier to induce people to drill in the Gulf of 
Mexico because it is more expensive--the deep drilling is much more 
expensive.
  The bill would also impose a tax on finished gasoline--$824 million 
over 10 years. It would seem that is going to increase the price of 
gasoline at the pump. It would eliminate tax credits for foreign oil 
production, exposing them to double taxation.
  So what do you think that is going to do? We are in a situation 
already where we are seeing more and more new formations of public 
companies going overseas because of Sarbanes-Oxley, with CEOs saying it 
is the instability of our regulatory process and the taxes and the 
litigation in our country that has caused more and more companies to 
decide to move their corporate headquarters to London or other 
exchanges. Furthermore, the jobs are going with them. So here we are 
trying to address this issue in a responsible way, and what are we 
doing to our oil companies? Why wouldn't they just go and register on 
the London stock exchange and make that their headquarters? That is 
what many American companies are doing now.
  If we decide we are going to double-tax this segment of industry in 
our country, we are just saying we don't want American oil companies. I 
can see why they would not only incorporate overseas but move more and 
more of their production overseas as well.
  I hope we will not pass this tax bill. A recent review by the 
Heritage Foundation estimated this tax package, combined with other 
policies in this bill, could increase the price of regular unleaded gas 
to $6.40 by the year 2016. That is ridiculous. Why would we pass an 
energy plan that would have the potential effect of doing that?
  No, what we should be doing is encouraging more refineries, 
encouraging nuclear power plants that are environmentally safe, 
encouraging drilling and exploration of our own natural resources, and 
we should be looking for renewable sources of energy--cellulosic 
ethanol, corn-based ethanol biodiesel, wind, solar. We have so many 
sources. My amendment would also create the ability to start research 
on wave and current energy resources, which they are doing in a limited 
way in Europe right now, using the Gulf of Mexico and our oceans for 
their energy potential.
  There is so much we can do that would be positive that we could agree 
on in a bipartisan way. This tax bill is a poison pill. The tax portion 
is unnecessary, it is counterintuitive, it will have the effect of 
increasing gasoline prices at the pump, it will ship jobs that are in 
America overseas, and I think we are going to lose major corporate 
business.
  That is unnecessary and I hope my colleagues will not pass this tax 
package, and I certainly hope we can take this part out of the 
equation, work on the bill that is before us--which has some very good 
points--and then we will be doing something to try to help with the 
rising cost of gasoline at the pump in our country.
  I hope we can help relieve the high price of corn which has resulted 
from our emphasis on ethanol. That is causing a rise in livestock 
prices, because the feedstock for livestock that is being raised has 
increased the cost. So all the meat we eat in this country is going to 
be at a higher price because ethanol is taking from the corn market and 
the feedstock market is suffering.
  We need to address these things. I certainly hope we will, in a 
responsible way, bring the costs of energy down and not have side 
effects such as the increased costs to livestock producers.
  I urge a ``no'' vote on this tax portion so we can get down to the 
business of doing what the purpose of this energy bill was, and that is 
to increase supply so we can be less dependent on foreign sources and 
lower the price of energy in our country.
  I yield the floor. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. DORGAN. Mr. President, I ask unanimous consent the order for the 
quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DORGAN. Mr. President, the bill on the floor of the Senate deals 
with energy. While there are many important things we discuss in 
Congress these days, energy ranks right near the top, in my judgment. I 
have indicated previously that most of us take energy for granted. We 
get up in the morning and turn on the hot water, and that

[[Page S8015]]

comes from energy. We flick a light switch, and that comes from energy. 
We get in the car and turn the ignition key, and that comes from 
energy.
  I told a story a while back about John Glenn and energy. I was on a 
trip with John Glenn, the former astronaut and former Senator. I was a 
young boy when John Glenn orbited the Earth in Friendship 7.
  Late one evening on what was the old Air Force One, a group of us 
were flying to Asia, and John Glenn was with the group. We were meeting 
with heads of state in several governments, Vietnam and China and so 
on. We were flying over the Pacific late at night in this little cabin 
in this Air Force 707. I leaned forward and began to ask John Glenn 
about his first space flight. I pumped him with a lot of questions. One 
of the questions I asked him about was whether he actually saw Perth, 
Australia. The history that has been written about this, and I recalled 
as a kid, was when John Glenn, up there alone in this tiny little 
capsule orbiting the Earth in Friendship 7, was orbiting the Earth and 
went to the dark side of the Earth, the town of Perth, Australia, 
decided they would all turn on their lights. All the lights in Perth, 
Australia were to be turned on to greet this astronaut flying alone, 
orbiting the Earth. I asked him if he saw the lights of Perth, 
Australia, and he said he did. On the dark side of the Earth in this 
little capsule orbiting the Earth all alone, John Glenn looked down and 
the sign of human existence on Earth was the product of energy, the 
product of lights, radiating that beam to that astronaut, saying a 
hello--greetings.
  It comes from energy. It is what we do to produce energy and use 
energy to make our lives better. They are better in many ways.
  One part of this energy issue we are debating in the Energy bill 
deals with oil. Oil is an interesting debate because on this little 
planet of ours that circles the Sun, there are about 6.4 billion of us. 
We have a lot of neighbors who are in tougher shape. About half of this 
planet's population lives on less than $2 a day. Half of them have 
never made a telephone call. On this planet there is a little spot 
called the United States of America and we are blessed through divine 
providence to be here, to live here. But it is interesting that while 
we have created a standard of living that expands the middle class and 
creates an increased standard of living, we do not have the quantity of 
oil that exists elsewhere on Earth. We use 25 percent of the oil that 
is needed every single day; 25 percent of all the oil used on this 
Earth is used in this country. Yet most of the oil is produced 
elsewhere--Saudi Arabia, Kuwait, Iraq, Venezuela, and other countries. 
Over 60 percent of the oil we use comes from outside of our country. 
God forbid something should happen that would interrupt that, because 
if it did, this country would be flat on its back with respect to its 
economy. It would dramatically impact the way we live.
  Over 60 percent of our oil comes from other countries, much of it 
from troubled parts of the world, particularly in the Middle East. Many 
of us believe we need to be less dependent on foreign sources of oil. 
We are dangerously dependent on foreign sources of oil and we need to 
become less dependent. How do we do that?
  One point is this. Seventy percent of all the oil we use in America 
is used in vehicles, where we run it through the carburetors and fuel 
injectors in the form of gasoline. Seventy percent of the oil is used 
through vehicles.
  So we have to find a way to make vehicles more efficient. That brings 
me to the debate about what are called the CAFE standards or the 
standards that require greater efficiency for automobiles.
  Now I serve on the Commerce Committee. I and Senator Feinstein, 
Senator Inouye and others included from the Commerce Committee a 
provision that requires vehicles to be more efficient.
  I know the auto industry is very aggressive in trying to see if they 
can jettison that provision in the underlying Energy bill that comes 
from the Commerce Committee. They do not want these increased 
efficiency standards. They believe they are pernicious, they will 
injure the auto industry. I think that is untrue.
  Now, they make the point, and in my judgment they deliberately 
misrepresent the point, in full page advertisements in my State and 
others and direct mail pieces to constituents, they make the point that 
what we are trying to do is to say: You must make automobiles or 
vehicles more efficient, and you do it on a fleet average, as CAFE has 
always been done.
  If you are making too many pickup trucks and not enough small cars, 
you have to make more small cars and fewer pickup trucks, so, 
therefore, you have an increase in fuel efficiency and, therefore, this 
approach threatens to take your pickup truck away.
  Well, that is not true. It is not accurate. But that is what is being 
alleged. This is a different approach. This standard says that for each 
class of vehicle, the class itself must be made more efficient. I come 
from North Dakota. We in North Dakota have, on rare occasions, I 
emphasize only rare occasions, some harsh weather. When it is 30 below 
zero and a 40-mile-an-hour wind, you do not want to drive in a Chevette 
out to check the calves during calving season in March, you want a 
vehicle, a four-wheel drive vehicle that has some weight, that has some 
power. That is what we use. I am not interested in full efficiency 
standards that discriminate against larger vehicles, but I also believe 
this: All of the vehicles, including pickup trucks, including larger 
vehicles, should be made more efficient.
  For 25 years, there has not been one change in the standard. For 25 
years in this Congress, we said: No, no. The auto industry doesn't want 
an increase in the efficiency requirement, therefore, we will not do 
it.
  I say ``we.'' I was part of that. But at some point, you have got to 
say to the industry: Look, they are making more efficient vehicles 
elsewhere. They ought to make them here. I mean, I have described the 
position of the industry in opposition to this as ``yesterday 
forever.'' I guess it is wonderful if you have romantic feelings about 
yesterday and you want it to continue forever with respect to your 
vehicles and the lack of a requirement to make them more efficient.
  But it does not help this country, it retards this country's ability 
to become less dependent on foreign sources of oil. That is what this 
vote is about: Do you believe we ought to become less dependent on 
foreign sources of oil? If so, then you better belly up and you better 
begin to support this kind of thing, or do you believe that we are not 
dangerously dependent? If it is fine for us to have 60 percent, heading 
toward 65 and 69 percent, we are told of our oil coming from off our 
shores, if you think that is fine, if you are perfectly content going 
to sleep at night saying it doesn't matter how much we get from 
overseas, it doesn't matter how troubled those areas are, let's hang 
our future, our economic future, on our ability to keep getting oil 
from troubled parts of the world, if that is how you feel, then, in my 
judgment, it ignores the reality.
  If you are one of those, as I am, who believes that we are too 
dangerously dependent on foreign sources of energy, then it seems to me 
you have to come to the floor and be supportive of CAFE standards, or 
at least greater efficiency standards for vehicles
  We have established a system in the underlying bill that establishes 
eight classes of vehicles. And you have to make them more efficient by 
class. Should not those who drive pickup trucks expect to have a more 
efficient pickup truck as well; better mileage on those vehicles as 
well? The answer is, yes, in my judgment.
  Now, my hope would be that someday, in some way, we will be able to 
find a way not to be dependent on oil itself. But I cannot see that in 
the near term. We are going to continue to use fossil fuels. I have 
described too many times for my colleagues that my first vehicle I 
bought for $25 as a young kid, it was a 1924 Model T Ford that had been 
in a grainery for some decades. I bought it for $25 and restored it 
lovingly as a young boy when I was in high school.
  So I ended up with a Model T that was decades and decades old. But I 
sold it later because you cannot, as a young boy, you cannot 
effectively date in a Model T; nobody wants to ride with you. But the 
point of the Model T is that in 1924 they made a car, and it is 
interesting. You put gasoline in that car exactly the same way you put 
gasoline in a 2007 or 2008 vehicle. Exactly

[[Page S8016]]

the same way. You go to the gas pump, stick a nozzle in the tank, and 
start pumping gas. Nothing has changed. Everything else about the car 
has changed. Computer technologies. More computer technology in a new 
car than existed on the lunar lander that put Neil Armstrong on the 
Moon.

  Better cup holders, keyless entry, iPod holders, heated seats, you 
name it. But let me ask you, do you think there has been an increase in 
the efficiency standards for those vehicles? The answer is no. The 
answer is no.
  I ask you to take this test. Go back and look 10 years ago at any 
model of car and then look at today's identical model and see how much 
has changed with respect to miles per gallon that are estimated for 
that vehicle. What you will discover is almost no change.
  Those of us who support the standards in the Commerce Committee have 
brought a bill to the floor that is a good bill. Now there are some in 
this Chamber who do not support it, and the auto industry itself is 
furiously working to get the votes to defeat our increased efficiency 
standard.
  The problem is, there is no amendment coming to the floor of the 
Senate that I can see. I mean, it seems to me, we have an underlying 
provision that I support, it is in the bill. Having had the bill now on 
the floor for some while, it is time to say: If you want to try to 
amend it, let's have an amendment on the floor, let's vote, let's have 
a thorough discussion and debate and let's have a vote.
  I am not someone who suggests the underlying amendment is the only 
amendment that has merit or has worth; there are, perhaps, other ideas. 
But I was in a meeting last evening and have been at some meetings 
today. It appears to me that the effort is simply, by the industry, to 
say: Let's not do this. Well, you know, we have been through that time 
and time and time again. When they say to the Congress: Let's not do 
this, the Congress salutes and says: Let's not do this.
  But we have come to a different intersection, it seems to me, with 
respect to the future of this country and the energy security of this 
country. That intersection requires us now to do what we must do to 
make us less dependent on foreign sources of oil. If we do not find a 
way to be independent, or at least less dependent on foreign sources of 
oil that come from troubled parts of the world, we are in deep trouble.
  Someday, I would hope, perhaps we can develop hydrogen fuel cars that 
are commercially available. I hope that our children and their 
grandchildren will be able to get in a vehicle that is a hydrogen fuel 
cell vehicle.
  I authored the legislation 2 years ago that established the title on 
hydrogen fuel cells. You know, interestingly enough, hydrogen fuel cell 
vehicles will have twice the efficiency of power to the wheel of the 
vehicle and put water vapor out the tailpipe. Wouldn't that be a 
wonderful thing? The fact that hydrogen is ubiquitous, is everywhere--I 
had this wonderful experiment going on in North Dakota that I 
established in the Appropriations Committee of using a wind tower, a 
more efficient wind turbine, take energy from the wind, use the 
electricity that you take through the turbine, you take energy from the 
wind in the form of electricity, use the electricity in the process of 
something called electrolysis, and separate hydrogen from water with a 
process of electrolysis.
  So you actually take an intermittent power source of wind and produce 
hydrogen, store the hydrogen for vehicle use. I believe we can get to 
the point of hydrogen fuel cell vehicles, which will make us much less 
dependent on foreign sources of oil. We will not need foreign sources 
of oil if we do what we can with this fleet. But that will not happen 
in 3, 5, or even 10 years from now. There has to be interim steps in 
which we take action to reduce our dependence, even as we continue to 
use the internal combustion engine, as we continue to use nearly 70 
percent of all our oil through our vehicles, even as we import over 60 
percent of the oil from overseas, we must take some interim steps to 
begin to address that.
  That is why this issue is so important, the efficiency of our 
vehicles. Finally, let me say this. I want our auto industry to 
succeed. I want this industry to succeed. I do not want to be a part of 
something that says to them, that, you know, you have been asleep at 
the switch, and so, therefore, we don't care about you. That is not my 
point.
  My point is, this industry will succeed, in my judgment, if they are 
under the gun and under some pressure to produce more efficient 
vehicles. Other companies in other countries are doing it and so too 
should ours. I wish to be helpful to our industry.
  One final point. There is a discussion about a couple provisions in 
the underlying Commerce Committee bill. One is the second 10 years, the 
4 percent efficiency a year, which was part of my offering, and the 
second was Senator Cantwell's offering of standards for the production 
of flex-fuel vehicles. We are building a 36-billion-gallon biofuels 
requirement in this bill. We are going to produce 36 billion gallons of 
ethanol, biofuels.

  Where are you going to use all of that if you do not have the flex-
fuel vehicles on the road so you can move that through those 
carburetors or fuel injectors. You have got to be able to have a flex-
fuel standard, so that when the automobile industry is producing cars, 
they are producing flex-fuel vehicles so they can run either the E85 or 
the regular gasoline. But if you are producing 36 billion gallons of 
biofuel and do not have flex-fuel vehicles on the road to be able to 
take those fuels and be able to run E85 through a vehicle, we are going 
to see this ethanol market collapse.
  That is why the flex-fuel provisions in the underlying bill from 
Commerce are so important. I wish to make the point that my hope is 
this afternoon, those who wish to try to amend the underlying provision 
in the Commerce Committee bill would come to the floor, let's have a 
debate about it. I believe the Commerce Committee provision is a 
thoughtful provision, that finally aggressively represents change and 
reform on automobile efficiency. I think the standards are achievable.
  I think they will be good for the industry. They certainly will be 
good for the driving public in this country, and, most especially, they 
will move us in the direction of being less dependent and move us in 
the direction toward being independent of foreign sources of oil, which 
I think is important to this country's economic well-being.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Oregon.
  Mr. WYDEN. Mr. President, I am going to take a few minutes this 
afternoon to discuss the tax provisions in this legislation because I 
think they are very much in the public interest and something I have 
been working on for many years.
  In the last Congress, for the first time in many years, the 
executives of the major oil companies--we are talking about Shell and 
BP and Exxon, the big five companies--were in front of the joint 
hearing I attended, a joint hearing of the Energy Committee and the 
Commerce Committee.
  With the executives there before this important hearing, I asked all 
of the oil CEOs if they agreed with a recent statement that President 
Bush had made. President Bush, of course, an oil man himself, hardly 
somebody who has any predisposition against the oil industry, recently 
said that: When oil is over $55 a barrel, the oil companies do not need 
incentives to explore and develop for oil.
  I asked each of the executives that day, the first time they had been 
asked the question in years and years, and to a person, the executives 
said they did not need those subsidies. Every single one of the 
executives said it. What was so stunning about it is that their 
admission was completely contrary to everything the Congress has been 
doing pretty much for the previous decade.
  For the previous decade, the Congress had just been throwing one 
subsidy after another at these major oil companies, amounting to 
billions and billions of dollars. Yet in the last Congress, when the 
executives were asked to go on record and publicly state their 
position, the executives admitted they did not need the money that the 
Congress has been throwing at them, the billions of dollars in 
subsidies the Congress has been throwing at them.
  So what we have is essentially a time now when the companies are 
making record profits, and they are charging record prices when clearly 
they do not need record subsidies. That is what the

[[Page S8017]]

Senate Finance Committee legislation does with respect to the tax 
provisions. I have reviewed them. They are clearly targeted at the 
major companies. They are not targeted at the independents and the 
small companies, and we ought to be taking steps to help them. In fact, 
I particularly credit our friend and colleague, the late Senator 
Thomas, for doing extraordinary work over the years, some of which I 
was privileged to work on with him, to help those small independent 
companies. Our good friend, the late Senator Thomas, championed that 
work. This is not going to affect those small independents. This is 
targeted at the major companies, the companies that, when I asked 
them--the first time they had been asked in years--admitted they did 
not need the billions of dollars worth of subsidies they were getting.
  It ought to be put in the context of what it means for the consumer. 
Our friend from North Dakota began this discussion as well. The reality 
is, when somebody pulls up to a gasoline station in New Jersey or 
Oregon or anywhere else, they are paying what amounts to a ``terror 
tax.'' That is what we ought to call it. Our addiction to foreign oil 
is literally a terror tax because when you pull up to that filling 
station in Oregon or New Jersey or anywhere else, you pay this huge 
price. Eventually, some of that money gets into the coffers of a 
government in the Middle East, and they backdoor it to people who want 
to kill us.
  Our addiction to foreign oil ought to be put in a context that is 
appropriate. It is a terror tax. This legislation which has been put 
together by a number of committees helps us to move away from that 
addiction to foreign oil. That is why I support it. By taking away some 
of the subsidies to the major companies, subsidies they have now 
claimed they don't even need, it makes it possible for us to look at 
some opportunities for developing renewable energy sources at home.
  I was at a filling station not long ago in Oregon that hopes to get 
all its fuel from Oregon crops--not from oil from the Middle East--
waste oil and other products. That is our vision of an important part 
of our energy supply in the future. If we get out of the business of 
shoveling billions and billions of dollars worth of subsidies to the 
major oil companies, subsidies they have now made clear they don't 
need, we can begin to develop a very different energy future.
  One last point I wish to make relates to a debate I am sure we will 
have, and that is a quick comment about the provisions which were added 
yesterday, Senator Bingaman's provisions, to the legislation. We are 
going to hear a lot about how somehow this is taking illegal action 
with respect to oil royalties; it is taking action retroactively, and 
it is illegal. We are going to hear that probably many times in the 
course of discussion of the Bingaman legislation that was added 
yesterday.
  The first thing I wish to make clear--and we were told this yesterday 
by counsel, because I asked about it--is that the Bingaman provision 
would be applied prospectively on oil produced on Federal offshore 
leases in the Gulf of Mexico. It would apply to future activity, all 
oil produced on Federal offshore leases in the gulf. As we go to this 
discussion and we are told repeatedly that this in some way unravels 
previous agreements, that this is illegal, this is retroactive, I hope 
colleagues will remember that we were told yesterday that it applies 
prospectively. It does not change the terms of any existing oil and gas 
lease. We are clear with respect to the Bingaman provision. It doesn't 
change the terms of any existing oil and gas lease, and it would be 
applied prospectively on oil produced on these Federal offshore leases 
and all oil produced on those leases in the gulf.
  One last point with respect to this issue is comments we have 
received from the Government Accountability Office with respect to the 
amount of revenue the Government receives from oil production from the 
gulf. What the Government Accountability Office has told us on this 
point is that the taxpayer receives revenue with respect to this 
production that is lower than virtually anywhere else in the world. 
They have done a comparison to take a look at all of the other 
countries where you have similar activity going on. Basically our take, 
the revenue for the taxpayer, hard-working taxpayers across the 
country, is lower than virtually anywhere in the world. The only place 
that is even close to us is where you have an oil company doing most of 
the production, essentially a government corporation.
  The reality is, with respect to drilling on our lands--and that is 
what I am talking about here, the people's lands, public lands, our 
lands--the taxpayer has been getting fleeced for years and years. The 
Bingaman provision begins to right the scale to get a fair shake for 
the taxpayers.
  I hope colleagues will support the work done by the Finance Committee 
with respect to the tax titles. It is important that they know the 
major oil companies have now admitted they don't need the subsidies, 
and the price per barrel is way over the amount the President said was 
the level when we ought to stop paying out subsidies. I hope colleagues 
will look at the facts with respect to the important provisions that 
were added yesterday by Senator Bingaman. I am of the view that 
taxpayers have been fleeced with respect to oil drilling on their 
lands, the people's lands. The Bingaman provision begins to right the 
scale.
  I will have more to say on this issue down the road.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. DURBIN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Mr. DURBIN. Mr. President, I rise today to support legislation which 
is pending before the Senate which would increase fuel economy 
standards in automobiles and trucks over the next 10 years. Regardless 
of what opponents of this amendment may say, technology is available 
today to reach this goal. We don't have to compromise the safety of the 
cars and trucks we drive and American jobs don't have to be lost to 
meet these standards. The CAFE legislation we have proposed is 
different than it has been in the past. It is a true compromise, a 
middle-ground position.
  We have come a long way with this compromise, and I applaud the 
efforts of Senators Inouye and Stevens. It is not an easy issue to meet 
in the middle on, but we have. I am sorry the automobile industry, 
which has resisted efforts to improve fuel efficiency over the last 20 
years, is still resisting these efforts.
  This is something most Americans understand intuitively. If we are 
going to reduce our dependence on foreign oil, if we are going to 
reduce the pollution we are creating with the cars and trucks we drive, 
we should be using fewer gallons of gasoline for the miles we drive. 
Yet what we have seen consistently over the last 22 years, while we 
have not had a national fuel economy standard, is that the cars and 
trucks being sold on average are getting less mileage. So each year, we 
buy these vehicles and find we need more gasoline than we did the 
previous year to drive the same number of miles. That is unacceptable.
  The CAFE provisions have come a long way since I offered my amendment 
2 years ago. When I came to the floor and suggested it was time to 
start talking about fuel economy, there were not too many Senators 
joining me. I called for an increase in fuel economy standards that 
would have had vehicles reach a target of 40 miles a gallon with a 
target date of 2016.
  This legislation before us sets a target of 35 miles per gallon, 
providing even more lead time for the automobile industry to the year 
2020. The last time we debated 40 miles a gallon, my opponents said 
that was just too high a standard to reach. Now we have lowered that 
target to 35 miles a gallon, and the industry proposal has 36 miles per 
gallon 2 years out. It makes me wonder why they no longer think it is 
arbitrary or whether they have any intention of ever meeting the 
target.
  My amendment 2 years ago did not provide the industry the flexibility 
this legislation does. I originally called for a hard target. You 
either had to reach it or pay fines. This legislation before us allows 
for flexibility, providing the National Highway Transportation

[[Page S8018]]

Safety Administration the authority to lower the target if it is not 
technologically feasible.
  My amendment did not reform the CAFE program by creating attribute-
based standards, something I understand the industry would rather see 
than the existing system. This legislation does. My amendment did not 
create a fleetwide fuel economy standard. This legislation does. Nor 
did it extend the credit trading program, as this amendment before us 
will do.
  We have come a long way to reach a compromise on this legislation. We 
understand the concerns about the existing programs brought to our 
attention. We understand the difficulties in the domestic auto 
industry. We tried to address them honestly. Unfortunately, for the 
past 2 years the auto companies were not at the table when they could 
have been. So we changed the CAFE system to allow for a more level 
playing field between American and foreign manufacturers.
  We provided NHTSA the authority to create attribute-based standards 
for passenger cars, something President Bush asked for. We already 
witnessed NHTSA set new fuel economy standards for light trucks by 
using this system. The CAFE standards will no longer be by manufacturer 
but, instead, fleetwide, based on the size-attribute system. That means 
the total fuel economy for all cars in the United States will meet the 
fuel economy targets we set. The targets will be set for different 
groups of cars based on their size attributes, not based on the 
manufacturer. Since the fuel economy target is fleetwide, the relative 
mix of vehicles manufactured by each company is not a real issue in the 
debate. GM will not be penalized for making more SUVs and fewer small 
passenger vehicles than Toyota.
  In order to meet a fleetwide average of 35 miles per gallon, each 
vehicle group will have to meet its own average fuel economy. For 
example, all midsized sedans will have to attain an average fuel 
economy standard. For example, the Ford Fusion, Honda Accord, Toyota 
Camry, and Chevy Malibu must attain roughly the same fuel economy. 
These cars will have to get about 36 to 38 miles per gallon based on 
current trends. Likewise, all large SUVs will be subject to different, 
lower average fuel economy. We will be comparing apples to apples. Each 
vehicle will have to reach an attainable fuel economy standard based on 
its size. All of these targets must average out to 35 miles per gallon 
for the entire fleet sold in the United States by 2020.

  I repeat that because it is a large and important change on how CAFE 
standards are now structured. The relative mix of any manufacturer's 
fleet between similar passenger cars and larger SUVs is less relevant 
in the fuel economy debate. The American auto manufacturers should not 
be at any disadvantage relative to foreign automobile manufacturers.
  Now we are focused completely on increasing the fuel economy of 
vehicles driven in the United States, regardless of who makes them and 
their size.
  Even though our legislation now addresses one of the major issues 
raised in the 2002 National Academy of Sciences report and does what 
NHTSA has requested, sadly, the auto manufacturers still oppose our 
compromise and have come up with even more arguments to try to persuade 
my colleagues to vote against improving the fuel economy of the cars 
and trucks we drive.
  Let me remind everyone about the impact on the transportation sector 
of more fuel-efficient vehicles.
  In 2005, the United States used 20.8 million barrels of oil per day. 
Sixty percent of it, or 12.5 million barrels of the oil we use, is 
bought from other nations--60 percent in the year 2005. Of the 20 
million barrels of oil we use every single day, 69 percent is used for 
transportation, and of this, 62 percent is used for surface 
transportation by cars and light trucks. Every minute, we consume more 
than 267,000 gallons of gasoline in America. You could say we import 
oil to run our cars, and by and large we do.
  Any increase in fuel economy will decrease our dependence on foreign 
oil. How significant is the issue of foreign oil? I don't need to 
remind anyone that we are in the midst of a war in the Middle East. We 
have lost 3,521 of our best and bravest soldiers. Ten times that number 
have been injured. Twice that number have been seriously injured, 
facing traumatic brain injury and amputations.
  It is no coincidence that these battlegrounds time and again are 
battlegrounds in the Middle East, which is the source of our energy. We 
have to reach a point where we are less dependent on that region of the 
world to fuel the American economy.
  NHTSA estimates that if we had not established CAFE standards in 
1975, highway fuel usage would be 35 percent higher today. A lot of 
critics of what we did in 1975 said that was a Government mandate, and 
they are right. It was a Government mandate which was resisted by the 
automobile industry. They said to us that it was impossible, there was 
no technology that could result in cars being more fuel efficient than 
the ones we drove in 1975. The manufacturers also argued that any cars 
built to meet these standards would be so light in weight that they 
would be unsafe. They argued that only foreign manufacturers would be 
able to make them. Thankfully, Congress ignored that argument and 
passed CAFE standards in 1975 and 10 years later saw the average miles 
per gallon of cars in America almost double because of the Government 
mandate.
  The Natural Resource Defense Council estimates that the Ten-in-Ten 
Fuel Economy Act now before the Senate will save 1.2 million barrels of 
oil per day by 2020. Think about it, 1.2 million barrels of oil per 
today. I think the price of oil is around $70. Do the math. That is the 
kind of money we will not be sending overseas, oftentimes to countries 
that do not agree with us in terms of our values and the kind of 
America and world we would like to see in the future. Raising fuel 
economy standards will reduce our demand for gasoline, which will 
decrease the amount of oil we have to import.
  Does anyone remember waiting in gas lines in 1973 to get their 10 
gallons of gas? I do. The shortage was due to an OPEC embargo on oil 
exports to the United States in response to actions we had taken in the 
Middle East. Overnight, the price of oil went up from $3 a barrel to 
$5.11 a barrel. Three months into the embargo, oil prices rose further 
to $11.65 a barrel. This embargo came at a time when the United States 
imported less than 30 percent of its annual oil--about 28 percent, in 
fact. And it hit America hard. Suddenly, Americans had to ration 
gasoline. Sales were maxed at $10 per sale, gasoline stations closed on 
Sundays, and people waited in lines. OPEC succeeded in exerting its 
influence on global markets, as well as the United States. Our 
vulnerability was revealed in 1973, and so easily we forget.
  Currently, crude oil costs just over $68 per barrel. Oil costs about 
27 percent more now than it did the last time we talked about CAFE on 
the floor, the last time I offered an amendment 2 years ago. And it 
makes the $11 a barrel during the oil embargo of the seventies seem 
like some sort of utopia.
  OPEC brought us to our knees in the 1970s. Imagine what they could do 
now. We do not import 28 percent of our oil now; we import 60 percent 
of our oil. If other countries we buy oil from decided to stop selling 
to the United States or to hike the cost, our economy and individuals 
and families, small businesses and family farmers would be in big 
trouble.
  Literally 40 percent of all U.S. oil imports come from potentially 
hostile or unstable nations, and 92 percent of all conventional oil 
reserves are in these nations. Amazingly, we continue to operate in a 
business-as-usual mode, reliant on imports to quench our thirst from 
some of the most unstable countries in the world. Venezuela, one of the 
top five oil exporters to the United States, is also one of the most 
autocratic in Latin America. The Chavez government regularly threatens 
nationalization of key industries and pursues policies inconsistent 
with many of our policies in the United States. Nigeria, while 
struggling on a path to democracy, is also extremely unstable, with 
ongoing violence in the oil-producing regions. They are also in the top 
five oil exporters to the United States. The more we rely on foreign 
nations to supply us with oil, the more susceptible we are to their 
instability.
  I hope my colleagues realize that any future crisis that prevents or 
significantly restricts the production or flow

[[Page S8019]]

of oil resources will have consequences on our economy far worse than 
anything we experienced in the 1970s. So we can do nothing and hope 
that some manifestation of 1973 does not occur again or we can take 
steps now, wise steps to prepare for our future.
  Another argument we hear is that if you raise fuel economy standards, 
American auto companies will be forced to make small cars that are not 
as safe. That is just not true.
  This argument comes from the same industry that has fought 
incorporating new technology into their automobiles that now make our 
cars safer--including seatbelts and airbags. They now argue that they 
are concerned about your safety and that raising fuel economy will put 
you at risk.
  Better fuel economy does not mean a vehicle needs to be smaller. Take 
for instance, the Saturn VUE. This vehicle's hybrid system will provide 
a 20 percent increase in fuel mileage over the conventional VUE engine 
and not be one inch smaller.
  Their safety argument stems from the idea that the only way to make a 
car more fuel efficient is to decrease weight and size of the vehicle.
  This, they posit, would decrease the safety of the vehicles.
  Although reducing vehicle weight will increase fuel economy, it is 
not our only option.
  The International Council on Clean Transportation released a report 2 
weeks ago called ``Sipping Fuel and Saving Lives: Increasing Fuel 
Economy Without Sacrificing Safety.''
  This report highlighted many mechanisms that would increase safety 
without affecting fuel economy, including: rollover-activated seatbelt 
pretensioners; window curtain airbags; and electronic stability control 
which allows each tire brake to be individually activated depending on 
circumstances.
  They also advocated the use of advance high-strength construction and 
aluminum and a shift to unibody construction.
  This would not only increase the safety of the vehicle, it would 
decrease the weight of the vehicle, thus also increasing fuel economy.
  Smart design and use of strong materials to protect the passengers in 
strategic places will also lead to decreased overall weight of the 
vehicles without diminishing either vehicle size or safety.
  The report went on to state that most of the technologies available 
to increase fuel economy have no impact on safety.
  In fact, as fuel economy has increased, the number of traffic 
fatalities has decreased.
  During the late 1970s and continuing through the 1980s, the number of 
fatalities per vehicle mile traveled decreased dramatically. During the 
same time, the fuel economy doubled.
  I think this shows us without a doubt that increased fuel economy can 
be obtained without jeopardizing vehicular safety.
  The National Research Council's 2002 report, ``Effectiveness and 
Impact of CAFE Standards'', found that increases of 12 to 27 percent 
for cars and 25 to 42 percent for trucks were possible without any loss 
of performance characteristics or degradation of safety.
  In fact, 85 percent of the gains in fuel economy we have witnessed 
have come from technologies that had no impact on vehicle safety--
including changes in valve control, throttling, or increasing the 
efficiency of accessories like air-conditioning and heating units.
  The National Highway Transportation Safety Administration has 
recently cited both the 2002 National Academies study and its own 
recent review of safety noting that down-weighting if concentrated 
among the heaviest vehicles could produce a small, fleet-wide safety 
benefit.
  Additionally, scientists have the ability to develop superior, 
cutting edge materials that can reduce the weight of the largest and 
most fuel inefficient vehicles.
  For instance, ``composite materials'' made from graphite fibers, 
magnesium alloy and epoxies comprise 60 percent of Boeing's 7E7--
providing greater durability, reducing maintenance and maintaining 
safety--and increasing efficiency between 20 and 30 percent over its 
rival similar product.
  The same auto industry that fought against safety belts, airbags, 
mandatory recalls, side-impact protection and roof strength is fighting 
against better fuel economy.
  I am not surprised--just disappointed.
  We have heard the argument too, that increasing fuel economy 
standards will force American automakers out of work.
  Sadly, we are already witnessing tremendous job loss in our American 
automotive manufacturing sector, and it wasn't caused by an increase in 
fuel economy standards.
  Instead, it has been this industry's failure to change with the times 
and recognize that the growing global dependence on oil would 
inevitably force gasoline prices to increase and that consumers would 
respond to the high prices at the pump by demanding more fuel-efficient 
cars.
  Some companies are adapting to consumer demand--they are making more 
fuel-efficient vehicles, and being rewarded by higher sales.
  Other companies are not adapting as quickly to consumer demand and 
continue to make cars that are more difficult to move off the lots.
  The argument that increased CAFE standards would result in job loss 
speculates that the industry would just stop producing vehicles instead 
of introducing new vehicles.
  I suggest that they would still make vehicles--that they would need 
expertise and labor to design new cars and retool existing models to be 
more efficient--expanding to potential for jobs in the U.S.
  Consumers across America are paying over $3 per gallon at the pump, 
and they are not happy about it.
  Stagnant fuel economy and increasing gasoline costs pinch American 
familys' pocketbooks.
  In a poll released right before Memorial Day, 46 percent of 
respondents said they expect spiking gasoline prices to cause them 
severe financial problems.
  Increasing fuel economy standards would help consumers save more than 
$2,500 over the life of the vehicle.
  According to another recent poll conducted by the Mellman Group, 88 
percent of rural pickup owners support higher CAFE standards.
  Eighty-four percent of people who use their pickup trucks on the job 
approve of increased CAFE standards.
  Eighty-seven percent of people who are economically dependent on the 
auto industry are supportive of increased CAFE standards.
  The consumers who actually have the most to gain from increased fuel 
economy are people who live in rural areas--they frequently have larger 
vehicles and must drive further on a daily basis.
  They are therefore spending more at the pump and are overwhelmingly 
supportive of increasing the fuel economy of the vehicles they need to 
drive.
  A constituent of mine, Chuck Frank, owner of ``Z'' Frank Chevrolet/
Kia recently visited with me to discuss the bill we are debating.
  Chuck runs a family business. His family has been selling and leasing 
cars and trucks in Chicago since 1936--and has sold well over 1 million 
Chevrolets.
  He doesn't want to be at odds with the manufacturers he represents, 
but he recognizes that times are changing.
  In a letter he sent us, Mr. Frank wrote:

       It is important for you to know that there is support from 
     within the auto industry for moving forward with raising 
     Corporate Average Fuel Economy standards.

  Mr. Frank also shared with me a recent editorial by Keith Crain, the 
editor-in-chief of Detroit's Automotive News. The editorial states:

       It's a real shame that the industry and the Alliance of 
     Automobile Manufacturers can't be a part of the solution 
     rather than an embarrassment to the nation.

  If there is no objection, I would like to have both the letter and 
editorial printed into the Record.
  Since 1999, Chrysler group has lost 2.7 percentage points of its 
market share while GM's domestic brands have lost 4.9 percentage points 
and Ford has lost 7.4 percentage points.
  It is time these companies recognize that they are not making enough 
of what consumers want and should start delivering what the consumers 
need.
  Finally, increasing fuel economy standards will help reduce 
greenhouse gas emissions.
  Every gallon of gasoline burned releases approximately 20 pounds of 
carbon dioxide into the atmosphere.

[[Page S8020]]

  One-fifth of the greenhouse gas emissions are from the tailpipes of 
our cars.
  Increasing CAFE standards will decrease emissions as we use less 
gasoline.
  Plug-in hybrid electric vehicles are extremely promising. Using 
energy equivalents between gasoline and electricity, the Natural 
Resources Defense Council calculated that a plug-in electric vehicle 
would get the equivalent of 105 miles per gallon.
  If we look at the oil savings we can expect to get from our bill, the 
alternative amendment and a strict 4 percent per year increase, we see 
that these approaches have a dramatically different impact on the 
amount of oil we use in our transportation sector.
  If we increase fuel economy by 4 percent annually, we see the best 
oil savings. Ironically, this is closest to what the President 
suggested in his State of the Union Address this year.
  Four percent per year would yield an oil savings of 5.5 million 
barrels per day by 2030 if the auto manufacturers were not provided an 
off ramp.
  The CAFE amendment that we have seen would make very small gains in 
oil savings by 2020, we would be using less than one-half of a million 
barrels of oil per day and by 2030 we would be using less than 2 
million of barrels of oil per day than we otherwise would be.
  Our proposal is the real compromise here, by getting to 35 mpg by 
2020, we would save 1.2 million barrels of oil per day. If fuel economy 
rises at 4 percent per year after the first 10 years, we would save 
almost 4 million barrels of oil per day by 2030.
  If we also look at the greenhouse gas emissions and fuel cost savings 
to consumers, we see more clearly how much more effective our bill is 
for consumers and the environment.
  The amount of oil savings that we would achieve by 2020 under our 
proposal is 1.2 million barrels per day.
  The other proposal would only save 0.4 million of barrels of oil per 
day.
  A 4 percent annual increase in fuel economy would achieve 1.7 million 
barrels of oil per day savings.
  Our bill would save 206 million metric tons of carbon dioxide from 
being emitted into the atmosphere every year.
  The other CAFE proposal would cut greenhouse gas emissions by only 65 
million metric tons per year.
  Finally, our bill saves consumers more at the pump. We would save 
consumers $25 billion by 2020 compared to only $8 billion in savings by 
2020 with the alternative CAFE proposal.
  Our position is the compromise position--it has been worked out in a 
bipartisan fashion. We have worked hard to address the concerns of the 
auto industry and NHTSA. And still the auto manufacturers are unable to 
come to the table to support a bill that makes any meaningful change 
that would save millions of barrels of oil per day, using off the shelf 
technology.
  I cannot for the life of me explain how a great industry such as the 
automobile industry in the United States has fallen so far behind when 
it comes to new technology in fuel economy. Several years ago when 
Toyota and other Japanese manufacturers came up with hybrid vehicles 
and hybrid engines, Detroit was dismissive: It is a fad; people don't 
really want them. They have now sold their 1 millionth Toyota Prius in 
the United States. There is a strong appetite for cars that get 40, 50, 
60 miles a gallon, serve our families, and serve the needs of our 
economy. Detroit has not registered when it comes to this obvious 
reality.
  My wife and I bought a Ford Escape hybrid, at the time the only 
hybrid offered by an American manufacturer. I am sorry to report to 
you, unfortunately, that the hybrid technology in my Ford was made by 
Toyota. Ford did not make it. They were not up to it. I hope they soon 
will be when it comes to more fuel-efficient vehicles.
  There are opportunities out there. I am afraid if we listen to the 
automobile manufacturers and continue to wait, nothing will happen. 
Fuel efficiency will continue to falter, will continue to be dependent 
on countries that send their oil to the United States.
  It is interesting, while we are in this CAFE debate in the United 
States, other countries have already had their debate. The winners, 
when it comes to fuel economy, are Japan and the European Union, where 
automobiles are now getting 40 to 46 miles per gallon. China--China, 
this fledgling economy--has more fuel-efficient cars than we do, and 
their fleet is almost at 35 miles per gallon already, as we debate 
whether the United States can reach that goal in 10 years.
  There is a lot of reasons we have fallen so far behind. I will not 
try to dwell on them, but clearly we have a chance to catch up.
  The last point I would like to make is, this is a timely debate as 
well when it comes to our environment. There are a few of my colleagues 
on the Senate floor who don't believe in global warming and climate 
change. They are entitled to their point of view. I happen to think 
they are wrong. I am sure they believe they are correct. I happen to 
believe something is happening in this world today: The climate is 
changing; storms are more violent; glaciers are melting. We are seeing 
changes already that are going to have a long-term negative impact on 
the world in which we live.
  When I look at my grandchild, who is about 11 years old, and talk 
about what the world will be like for him, I am sure the day is going 
to come when he is going to ask me: Did you do what you could to try to 
avoid the environmental crisis that was looming when you saw it back in 
the early 21st century?
  It is a legitimate question. Each generation has to be able to answer 
that question. We know now if we don't do something smart when it comes 
to energy and energy consumption, we are going to make this world less 
comfortable for us to live in. That is a fact. I hope by moving toward 
fuel efficiency we can start doing the right thing.
  And I will go a step further. If we fail on the fuel efficiency 
question, on the CAFE question when it comes to the cars and trucks 
that we drive, then I believe we will have failed on one of the most 
fundamental issues in terms of the future of this planet and the future 
of the United States. I honestly believe we have an opportunity to move 
forward, and I hope we do it, and do it soon.
  Mrs. BOXER. Mr. President, will the Senator yield for a question?
  Mr. DURBIN. I will be happy to yield.
  Mrs. BOXER. First of all, as chairman of the Environment and Public 
Works Committee, your words are really like music to my ears. I am so 
grateful that you, Senator Durbin, are in the leadership because I 
think you reflect the views of the vast majority of Americans who see 
the challenges ahead and know we just can't do business as usual.
  I think this bill is a very fair bill when it comes to fuel economy. 
This bill went through the Commerce Committee, a committee on which I 
serve, and it was a bipartisan measure. Everyone voted for it. It was 
fair; it was good.
  The question I have for my colleague is, I just wanted to make sure 
he was aware of another provision in this bill, which is a good one, 
too, and that is to make sure the Federal Government is, in fact, the 
model of energy efficiency when it comes to the purchase of new cars. I 
wanted to make sure my friend was aware because it is tucked away in 
this bill, a provision we got out of the Commerce Committee, that says 
from now on, when the Federal Government buys its 60,000 cars a year--
60,000 cars a year for its Federal fleet--that it buy the most fuel-
efficient car. Is my friend aware of that?
  Mr. DURBIN. I am aware because I know the Senator from California has 
been working on this for quite some time. I might also add that I 
recently met with the Postmaster General, and the U.S. Post Office has 
many vehicles bought by the Federal Government. They are trying to 
focus on how to reconfigure existing vehicles with diesel technology, 
for example, which is less polluting and uses less fuel. And they need 
our help. So I hope this bill will be a breakthrough when it comes to 
Federal vehicles.
  I might also add, I am aware the Senator from California has joined 
me and a few of our colleagues and invited the experts to come and take 
a look at our office operations. Members of Congress, the Senate and 
the House, have to lead by example, and I hope the small steps we have 
already taken, and other steps we will take to have less of what we 
call a carbon footprint from our operations, may point the way toward 
more fuel efficiency and conserving electricity even in our own office 
operations.

[[Page S8021]]

  Mrs. BOXER. Well, absolutely, I say to my friend, and again I thank 
him for yielding for another question.
  Several of our offices are part of this model project to see how 
energy efficient we can be. It is a pretty straightforward way for us 
to lead by example.
  The other question I have for my colleague is this: The bill that is 
on the Senate floor, which Senator Reid worked so hard to put together, 
along with Senator Bingaman, myself, and Senator Inouye and others--
Senator Kerry was involved, and I know my friend was involved as the 
assistant leader. There are other provisions in this bill--which is why 
I am so hopeful we will get this done--that take this notion of the 
Federal Government being a model to our buildings as well.
  I am not sure my friend is aware of the exact number, but the Federal 
Government either runs or operates 8,000 buildings--8,000 buildings. 
When my friend talks about global warming, it is a fact that in America 
39 percent of the greenhouse gas emissions comes from buildings. So if 
we can set the tone here, and we can move forward with a bipartisan 
vote--we were able to pass a lighting efficiency bill for the Federal 
Government, which is included. This also has a component where grants 
will be given across this country to cities and counties to make their 
buildings energy efficient in terms of lighting. It will save money, 
and it will reduce the carbon footprint.
  Then, with the help of Senators Lautenberg and Warner, we got another 
piece of legislation included in this bill, which is called the green 
buildings bill, which also impacts all new and existing Federal 
buildings and also requires the EPA to come out with a model of green 
buildings for schools. So we will help our schools because you are so 
right when you talked about your 11-year-old grandson. I have a 12-
year-old grandson, as you know. They are going to ask those tough 
questions, and they may well ask it of the schools they are in too.
  So I wanted to make sure my friend knew, since we really are talking 
more with the leadership of Senator Bingaman, who has been working on 
the most contentious amendments, that there is so much in the 
underlying bill that came out of his committee, my committee, and other 
committees that is strong, and that is why we would hate to see this 
derailed. This would be an enormous setback.
  The people want us to reach across party lines and take care of 
business, and an energy policy is going to take care of business.
  Mr. DURBIN. I might just say to the Senator from California that it 
wasn't that long ago we used to hear about all the California laws, 
rules, and regulations. It was a source of amusement to many of us in 
the Midwest that you had your own design in automobile engines, and we 
thought: What is going on with these crazy people in California? We 
learned our lesson because in the period of time that you led the 
Nation in thinking about these things, you proved something: that you 
could keep economic growth moving forward in California and conserve 
energy in the process.
  That is a lesson the Nation needs to learn. We don't want to 
sacrifice jobs, business growth, or opportunity in America. Instead, we 
want to create opportunity in a reasonable, wise, environmentally 
sensitive way.
  I thank the Senator from California for her leadership on this issue.
  Mr. President, I yield the floor.

                          ____________________