[Congressional Record Volume 154, Number 19 (Wednesday, February 6, 2008)]
[House]
[Pages H595-H596]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                     TIME TO WAKE UP ON THE BUDGET

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentlewoman from Ohio (Ms. Kaptur) is recognized for 5 minutes.
  Ms. KAPTUR. Madam Speaker, this week, ExxonMobil reported it beat its 
own record for the highest annual profits ever recorded by any company 
with its net income rising to $40.6 billion in 2007, the highest record 
profits of any company in American history. Those profits are due to 
the surging oil and gasoline prices that we are all paying. Meanwhile, 
here in Washington, the establishment sits around the table in 
anticipation of the President's budget proposal. Lobbyists, advocates, 
lawmakers, and agency heads wait in anticipation.
  This year it seems that the President has outdone himself by pushing 
up our national debt to $9.2 trillion, nearly $10 trillion. When 
President Bush took office, gasoline cost $1.45 a gallon. When he took 
office, gasoline cost $1.45 and we were showing surpluses after the 
discipline we had exacted here during the 1990s, surpluses in our 
budget of $5.6 trillion. Now gasoline regularly rises above $3 a gallon 
and the annual budget is in the red, his latest budget as submitted by 
over $407 billion, and you know it is going to rise to over half a 
trillion dollars with the war costs.
  What a story. While the Nation goes deeper into the red with higher 
gas prices and bigger deficits, oil companies are making out like 
bandits. Compare a $407 billion budget deficit for our country with 
$40.6 billion in exorbitant profits taken in by ExxonMobil in 2007. 
ExxonMobil posted the largest profit in U.S. history, sucking those 
dollars from our people.

[[Page H596]]

  While we are considering a stimulus package to jump-start our 
economy, imagine how solving our tremendous energy crisis could help 
every single American. We are talking about sending pennies to some 
Americans in this so-called stimulus package, while these giants are 
running off with billions and billions and billions of dollars. Where 
is the courage of this Congress to balance these accounts and to make 
sure that those who need help in our country actually get it?
  If you add up the President's budget request for the Army Corps of 
Engineers, the Small Business Administration, the Department of Labor, 
the National Science Foundation, the Department of Commerce, and the 
entire Environmental Protection Agency, it costs $2 billion less to run 
them all than ExxonMobil made in 2007. Think about that.
  Let's think about what it means for our Nation's priorities. It is 
more important for ExxonMobil to make billions than it is for us to 
conduct scientific research or to clean up the environment or to extend 
unemployment benefits or to help businesses in this economy, small 
businesses try to survive, to fix up our levees and our bridges and our 
roads?
  Think about the millions of Americans we could help who are facing a 
meltdown in the housing market and losing their most important form of 
savings. Think about the nearly 200,000 homeless veterans living on the 
streets of our country. What an embarrassment. Think about the 33.5 
million Americans that are food insecure and regularly go to bed hungry 
as our food pantries run dry.
  It is often said that a budget is the real show of a nation's values. 
When President Bush complains about how America is addicted to oil in 
his State of the Union but then fails to move our Nation to energy 
independence, we sure know where his values fall. When our society 
allows our oil barons to make off with billions, skimmed away from the 
American people, we know where those loyalties lie.
  With oil prices continuing to rise, the high price of gasoline 
continues to fuel our trade deficits. With oil prices as high as $98 a 
barrel last year, the monthly trade deficit from oil rose to a level 
rarely seen, $24 billion just in November of 2007.
  We all know that this FY 2009 proposed Bush budget is an empty shell 
from a lame duck President, but somehow we had expected more. Congress 
should reject the President's proposed budget and rewrite it in a way 
that protects the American consumer, invests in energy independence, 
and provides a real stimulus for the American economy at a time when 
the American people are crying for it.
  Millions and millions of Americans are losing their homes, their most 
important form of savings. When is this Congress and when is this 
President going to wake up?
  Madam Speaker, I include the following for the Record.

                     [From the Blade, Feb. 2, 2008]

        Surging Prices Pump Up Oil Giant's Record $40.6B Profit

       New York.--ExxonMobil reported yesterday that it beat its 
     own record for the highest annual profits ever recorded by 
     any company with net income rising to $40.6 billion in 2007 
     thanks to surging oil prices.
       The company's sales last year, more than $404 billion, 
     exceeded the gross domestic product of 120 countries.
       ExxonMobil made more than $1,287 of profit for every second 
     of 2007.
       The company also had its most profitable quarter ever. It 
     said net income rose 14 percent, to $11.7 billion, or $2.13 a 
     share, in the last three months of the year.
       Like most oil companies, Exxon benefited from a near 
     doubling of oil prices, as well as higher demand for gasoline 
     last year. Crude oil prices rose from a low of around $50 a 
     barrel in early 2007 to almost $100 by the end of the year--
     the biggest jump in oil prices in any one year.
       ``Exxon sets the gold standard for the industry,'' said 
     Fadel Gheit, an oil analyst at Oppenheimer & Co. in New York.
       Oil companies all have reported strong profits in recent 
     days.
       Chevron, the second-largest American oil company, said 
     yesterday that its profits rose 9 percent last year, to $18.7 
     billion.
       The backlash against the oil industry, which periodically 
     has intensified as gasoline prices have risen in recent 
     years, was swift.
       One advocacy group, the Foundation for Taxpayer and 
     Consumer Rights, called the profits ``unjustifiable.''
       Some politicians said Congress should rescind the tax 
     breaks awarded two years ago to encourage oil companies to 
     increase their investments in the United States and raise 
     domestic production.
       ``Congratulations to ExxonMobil and Chevron--for reminding 
     Americans why they cringe every time they pull into a gas 
     station,'' Sen. Charles Schumer said (D., N.Y.).
       Exxon defended itself against claims that it was 
     responsible for the rise in oil prices.
       Anticipating a backlash, Exxon has been running 
     advertisements that highlight the size of the investments it 
     makes to find and develop energy resources--more than $80 
     billion between 2002 and 2006, with an additional $20 billion 
     planned for 2008. The company says that in the next two 
     decades, energy demand is expected to grow by 40 percent.
       ``Our earnings reflect the size of our business,'' said 
     Kenneth Cohen, Exxon's vice president for public affairs. 
     ``We hope people will focus on the reality of the challenge 
     we are facing.''
       Given the darkening prospects for the American economy, 
     some analysts said oil company profits soon might reach a 
     peak. Oil prices could fall this year if an economic slowdown 
     reduces energy consumption in the United States, the world's 
     biggest oil consumer.
       Such concerns have pushed oil futures prices down about 10 
     percent since the beginning of the year. Oil fell 3 percent, 
     to $88.96 a barrel, yesterday on the New York Mercantile 
     Exchange.
       Exxon shares fell a half-percent, to $85.95.
       Some analysts said high oil prices, and the record profits 
     they create, were masking growing difficulties at many of the 
     major Western oil giants.
       Faced with resurgent national oil companies--like 
     PetroChina, Petrobras in Brazil, or Gazprom in Russia--the 
     Western companies are having a hard time increasing 
     production and renewing reserves.
       As oil prices increase, countries like Russia and Venezuela 
     have tightened the screws on foreign investors in recent 
     years, limiting access to energy resources or demanding a 
     bigger share of the oil revenues.
       At the same time, many of the traditional production 
     regions, like the North Sea and Alaska, are slowly drying up.
       Western majors, which once dominated the global energy 
     business, now control only about 6 percent of the world's oil 
     reserves. Last year, PetroChina overtook Exxon as the world's 
     largest publicly traded oil company.
       Excluding acquisitions, Exxon was the only major 
     international oil company with a reserve replacement rate 
     exceeding 100 percent between 2004 and 2006, meaning it found 
     more than one barrel for each barrel it produced, according 
     to a report by Moody's Investors Service, the rating agency.
       In a related development, the OPEC cartel, which met in 
     Austria yesterday, left its production levels unchanged, 
     resisting pressure from developing nations to pump more oil 
     into the global economy.
       The Organization of Petroleum Exporting Countries is set to 
     meet again next month. The cartel signaled it would be ready 
     to cut production to make up for a seasonal slowdown in 
     demand in the second quarter.
       OPEC's actions mean the cartel is determined to keep prices 
     from falling below $80 a barrel, according to energy experts.
       The U.S. response to OPEC's decision was measured.
       ``I think everyone is fully aware that having a reliable 
     and steady and predictable supply of oil is a benefit to the 
     global economy,'' White House spokesman Tony Fratto said. 
     ``We hope that they understand that their decisions on oil 
     production have a real impact on the economy.''

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