Congressional Record, Volume 154 Issue 69 (Tuesday, April 29, 2008)

[Congressional Record Volume 154, Number 69 (Tuesday, April 29, 2008)]
[House]
[Pages H2840-H2846]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

ENERGY IN AMERICA

The SPEAKER pro tempore. Under the Speaker's announced policy of
January 18, 2007, the gentleman from Iowa (Mr. King) is recognized for
60 minutes.
Mr. KING of Iowa. Madam Speaker, it's an honor to be recognized to
address you here on the floor of the United States House of
Representatives.
I listened to my colleagues with great interest, and I appreciate the
constitutional acumen that they bring to the floor. I honor their work
and support their statements, and do through a rather unsmooth segue
into the issue that I believe needs to be addressed here, Madam
Speaker, so that there can be a greater depth of knowledge about the
subject of energy in this country.
First of all, there is a certain idea that somehow we can talk about
energy conservation and we can pass legislation to require automobiles
to get 75 miles to the gallon and somehow that's not going to cost a
price in quality of life or in engineering costs. And some people
believe that that can actually happen. And I know that if we go so far
as to mandate such a thing, you would have to park your Harley today
because it wouldn't get that kind of mileage. And if that's going to
happen with a family automobile, I would like to know how that is
designed to be done without putting us in a very flexible and crashable
vehicle that doesn't provide very much safety for the people that are
inside.
I'm concerned about that approach, Madam Speaker, and I'm concerned
about an approach that believes that there is maybe only one or two
things we can do with energy, and maybe there is a silver bullet here
to solve all of this.

{time} 2045

Madam Speaker, there is no silver bullet on energy. It is a cost of
everything that we do. A cup of coffee, a pair of shoes, a suit, a
ticket to the ball game, a television set, everything that we might buy
or consume, including all of our food, the price of it is wrapped up in
energy. And inflation of energy is inflation of everything. And as we
watched gas prices go up since the beginning of this Congress, this
110th Congress, when Speaker Pelosi took the gavel, gas prices have
gone up over 50 percent in that period of time. And the promise was,
well, there was going to be a commonsense approach to energy.
Madam Speaker, I'm still waiting for that commonsense approach. I've
seen pieces of legislation come across this floor a number of times in
this 110th Congress, and every piece of legislation that addressed
energy raised the cost of energy, and no piece of legislation increased
the supply of energy, which would reduce the cost.
The law of supply and demand is that if you have more supply than you
have demand, prices fall because the sellers have to discount in order
to turn their product into cash. And if you have a demand that's higher
than the supply, the price goes up because the buyers are willing to
pay more because they want it; so they compete for the product.
Just the same way as if you're a great athlete, Madam Speaker, and
maybe only a few people can sky walk above the hoop and slam the ball
down through in a basketball court, and only a few of those people get
offered the millions of dollars because it's a rare talent. There's a
lot of demand for that kind of talent and only a little bit of supply.
So the price for a very highly talented basketball player goes up and
up. The same goes for all of our sports. We can see that easily. If
you're a clutch pitcher and you can step into a baseball game with the
bases loaded and nobody out and are ahead by one run and take them down
three at a time and you can do that consistently and perform well under
pressure, if you've got that kind of control, you're worth a lot of
money in that arena because the supply is low and the demand is high.
Well, with energy the supply is low and the demand is high, just like
it is for a very talented basketball player or a very talented attorney
or a very talented actress or a very talented CEO. So how do you
reverse this when you're dealing with the American people, whose
standard of living and quality of life is wrapped up in this cost of
energy? And, Madam Speaker, I will submit that we must increase the
supply of energy, in every category that we intend to use energy, we
need to increase the supply.
Now, if you'll imagine, Madam Speaker, in your mind's eye, a pie
chart, a 360-degree pie chart of all the components of our sources of
energy, and that would include gasoline and diesel fuel and natural gas
and clean burning coal. It would include wind energy, solar energy,
ethanol, biodiesel and biomass, hydroelectric, and it would include
nuclear. And also on that pie chart, we need to add a slice in there
for energy conservation because energy conservation is--on this, Madam
Speaker, I agree with the majority party. Energy conservation is an
important component of our overall energy solution.
But there is no energy solution that has been offered by the
leadership here. We do not have a commonsense solution that's been
offered by the leadership. We have pieces of legislation that raise the
cost of energy, blocking certain parts of the publicly owned lands from
drilling. And the places where we could drill, there has already been a
blockage of being able to transport natural gas or oil through those
public lands. So we have taken millions of acres of oil-producing lands
off-limits, off-limits to the American people, while we are dependent
on foreign oil. The exact opposite that I believe that we should do.
And we're not drilling in ANWR. Now, ANWR, the Arctic National
Wildlife Refuge, whoever named that was really thinking ahead if they
thought that they wanted to lock up a lot of energy underneath the
frozen tundra. But I went up there to look at that land. I really
thought that if I would get up there, I would find ANWR, the Arctic
National Wildlife Refuge--I believed I would get there and it would be
teeming with wildlife. I thought caribou would be running all over the
place and there would be some wolves there picking off the strays, and
I thought there would be some musk-oxen and maybe some Arctic fox, and
I thought I would see an alpine forest because I had seen that in one
of the commercials that said ``Don't drill ANWR.''
Well, I went up there, and I did actually do the research to find out
where the furthest-most northerly tree is. If you remember, Madam
Speaker, I think you and I learned this in eighth grade science class
that the Arctic Circle and the Antarctic Circle are lines around the
globe--on the northern hemisphere, the Arctic Circle is a line around
the globe, north of which trees don't grow. So it shouldn't be a
surprise to anybody to find out there are no trees in ANWR. And it was
a surprise to me to find out that there is no resident caribou herd
there. I did see four musk-oxen as we flew all over ANWR looking for
some wildlife. We saw that and two white birds, and that was the extent
of it, although there are some whales that get harvested as they swim
along the shoreline and there are some polar bears that live up there
along the shore. So it's not without wildlife.
But we drilled in the North Slope of Alaska back in 1973--1972 and
1973 was when it began. There was a great concern about disturbing the
natural regions up there and a concern that we would tear up the
natural tundra and it could never be replaced again and that there
would be oil spills that soaked up that couldn't be cleaned up.
And, Madam Speaker, I went up there and found out that we have
drilled in the North Slope, and we have done it well. And if we fly
across that North Slope and look around, I couldn't identify a single
oil well, not one. They are all submersible pumps set down below the
ground level. And the pads that are there for workover are places that
they drive to on ice. So when the ice melts in the summer, there's no
sign that anybody approached the well. And the caribou herd went from
7,000 head in 1972 to 28,000 head as of a couple, 3 years ago. That's a
fourfold increase in caribou herd in the North Slope in Alaska, in a
region that was alleged to have been

[[Page H2841]]

poised before it was drilled to having the wildlife and the natural
environment there damaged significantly. It has not been, and there is
no example that it was. The only example that we can find is that
caribou like to get up on the higher ground where the wind blows the
flies off of them and they like to have their calves up there out of
the water; so their population has increased. But those are the caribou
herds that are resident to the North Slope of Alaska, but there are no
caribou herds that are residents in ANWR. So the natural animal life
there won't benefit quite as much except the caribou do migrate into
ANWR to have their calves in the spring starting about mid-May, early
to mid-May, and then along about mid-June or the latter part of June
when the calves are strong enough, they walk back over to Canada, where
they actually do live.
But in that whole region in the North Slope, no spills, no measurable
impact on the environment. And we can do the same thing, only better,
in ANWR. We can do it with about a 2,000-acre footprint, and we can
drill directionally, and we can open that up and we can bring that oil
over to the Alaska pipeline, pump it down to Valdez, and put it on
tankers and ship it like we have done out of Alaska for years and years
successfully. That oil needs to come out. It needs to come out of the
ground. It needs to go into the marketplace.

You cannot defy the law of supply and demand. If you shut down the
supply and the demand remains the same, the price goes up. If you
increase the demand and you keep the supply the same, the price goes
up. We have both of those things happening. We have a demand increase,
and we have a supply growth that's being shut down.
And not only that, Madam Speaker, but instead of voting down drilling
on publicly owned land, and I will say nonnational park public lands,
we need to open up our nonnational park public lands for drilling. We
need to do that. We need to drill in the Outer Continental Shelf,
primarily offshore Florida, where we know there are at least 406
trillion cubic feet of natural gas. And where the people who are
sitting on the beach, there's a concern that if they have information
that there's a drill rig out there at 199 miles, though you can't see
it much beyond about 12 miles, but if there's a drill rig out there
offshore at 199 miles, some folks are afraid that people won't go sit
on the beach if they hear a rumor that there's a drill rig out there.
So we shut off a 200-mile limit for exploration when a country like
this needs the natural gas and a country like this needs the oil. We
need to drill the Outer Continental Shelf all the way up and down our
coast off of California, all the way north as far as there is energy.
We need to tap into it. We need to tap into it all, Madam Speaker, and
put it all on the market.
And we need to add into that the alternative energy uses that we
have. We have developed a tremendous industry in renewable fuels. And I
speak from a base of, I will say, experience, and I represent the Fifth
Congressional District of Iowa. There are 435 congressional districts
in Iowa, and of the 435 districts, there's only one that produces the
most renewable energy, and that's the Fifth District of Iowa, when you
count ethanol, biodiesel, and wind.
But I see my good friend from California, former chairman, now
ranking member of the Armed Services Committee, Mr. Duncan Hunter, to
whom I'd be so happy to yield.
And I appreciate your being down here, Duncan.
Mr. HUNTER. I thank my friend for yielding. And the gentleman from
Iowa is indeed an expert on renewable energy, and I've spent a lot of
time in his wonderful State examining that program, which is very
robust right now.
I thought the gentleman might be interested, because this is a
subject that's near and dear to your heart, in the recent progress on
the border fence and the recent actions that have been undertaken by
the administration.
The gentleman from Iowa and I have linked arms on a number of
occasions to do several things: one, pass the border fence legislation
that mandates the construction of a double fence across the southern
border for about 854 miles. And as we know, that legislation was
watered down some in December by the Senate, but it remains a mandate
to do at least 700 miles of fence. And the administration just
undertook the waiver of environmental regulations that would keep the
fence from being built for many years.
In fact, I remember that when we tried to fence Smugglers Gulch,
where a great deal of cocaine came into the United States between San
Diego, California, and Tijuana, Mexico, we were delayed for 12 years by
a series of lawsuits and regulations being invoked. I think the last
regulatory delay revolved around whether or not a gnatcatcher would fly
over a 12-foot-high fence, and after a year I think the experts
concluded that indeed that gnatcatcher could clear the fence; so we
could build it.
So the administration has invoked this waiver, and I want to commend
Secretary Chertoff for undertaking that waiver because it's absolutely
necessary if we're going to get the fence built. Otherwise, we will
never get it built. And today the southwest border, and particularly
Texas along with Arizona, are absolutely on fire with the smuggling of
drugs and illegal aliens. And last year they moved about 22 metric tons
of cocaine across the border, across the southwest border, and about
368 tons of marijuana. So it's still a trafficking corridor or a series
of corridors which are flowing relatively unimpeded by this relatively
small force of Border Patrolmen and Customs and DEA agents who attend
the border. But getting that double-border fence up, and in some cases
it's a single fence--I would like to see a double fence all the way
across--but getting that fence up is going to have a great, very
salutary effect on law enforcement in the United States.
And I'm reminded that when we built the double fence in San Diego,
the crime rate by FBI statistics in the county of San Diego dropped by
56.3 percent. And I think if we indeed get the series of fences up
across the southwest border, you're going to see fewer criminal aliens
being incarcerated at the Federal, State, and local level. And right
now there are 250,000 of them in incarceration.
So since the gentleman has been my partner in these endeavors, I knew
he would want to hear the report.
A hearing was chaired by the Committee on Resources and two
subcommittees in Brownsville, Texas, and I think we aired the issues
very fully. And if you listened to all the testimony, a couple of
things were clear: One, we need the fence because no one has an
alternative; and, number two, if we don't get the waivers, we will
never get the fence built.
So I thought the gentleman would be interested in that progress, and
I just wanted to report that to him.
And I thank you for yielding.
Mr. KING of Iowa. Reclaiming my time, Madam Speaker, I very much
appreciate the gentleman from California (Mr. Hunter) for coming to the
floor and filling us all in on this report.
I look at the statistics, and absolutely I support the mandate of
Congress. You say 700 miles, but when you calculate curves in the
border, it comes out to 854 miles, as the gentleman has said. The 22
metric tons of drugs and you add to that the 368 tons of----
Mr. HUNTER. Of marijuana.
Mr. KING of Iowa. Of marijuana. And I happen to know that the value
of those drugs coming across our southern border are $65 billion worth
of illegal drugs.

{time} 2100

That is with a B. To try to get one's mind around $65 billion; what
is that? Well, for example, PEMEX, Mexican nationalized oil company,
produces about $28 billion worth of oil pumped out of Mexico and along
the Gulf; $28 billion. This is about 2\1/2\ times the value of all the
illegal drugs coming into the United States. The 250,000 criminal
illegal aliens that are incarcerated in the United States amounts to 27
percent of the criminal population, the inmate population in our
Federal penitentiaries, and there is a report that came out in April of
2005 that shows that we are funding about one out of every four
prisoners that apply. And you do the math on that, and it comes out to
about 25 percent of our State and local prisons are criminal inmates
there as well.
So when I look at what happens in places like Israel, where they have
built a fence that has been almost 100 percent effective, you can't
make the

[[Page H2842]]

argument, I don't believe, that it's not effective when you put up a
barrier to keep people out. It's a lot different than building a Berlin
Wall, for example, to keep people in. This is a barrier to keep people
out. And with those that do come in, the crime that comes in with that,
as the gentleman from California said, a reduction of 56.3 percent in
the Smugglers Gulch area.
There are Americans that are dying every day in this country at the
hands of people that if they were simply kept in the country where they
are citizens, their crimes would be perpetrated someplace else. The
measure of that is far greater than our casualties in the Middle East.
I don't think there's any way to calculate it otherwise.
As I add to this argument, I ought to point out also that the news I
saw showed that in Tijuana over the weekend there was a running drug
gang fight where they were driving through the streets, shooting at
each other, with tourists around and residents around, and the number
that I saw was 13 killed, and those that were killed, the way I
understood it, were all criminal drug gangs.
Mr. HUNTER. If the gentleman will yield.
What that really amounts to is that this industry of moving this
poison across the international border to the United States is cocaine
that poisons our young people. That is such a massive industry now on
the southern border of the U.S. that the drug gangs are fighting each
other for control of this lucrative industry. That is what it
represents. That is another reason why we need to build that border
fence.
Incidentally, we had 202,000 arrests in the area where the fence has
now been constructed between San Diego, California, and Tijuana,
Mexico. After we constructed it, we went down to 9,000 arrests. That is
a reduction of more than 90 percent. And in the Yuma sector, where we
have also now constructed double fencing, we went from 138,000 arrests
to a little under 4,000. That is more than a 95 percent reduction.
So of all the things that we have tried with respect to controlling
the border, we have discovered that one thing does work and that is a
border fence. The President and Mr. Chertoff should be commended for
invoking this waiver that we gave them so we can move ahead on this
very, very important part of the people's business, and that is keeping
their kids safe.
The last statistic that I would give the gentleman that I brought up
in Brownsville was this. Last year, we intercepted 58,000 people coming
across the border from Mexico who were not citizens of Mexico. They
came from virtually every country in the world. More than 800 of them
came from Communist China, 14 came from Iran, and 3 of them came from
North Korea. That means that anybody in the world with a television set
can understand very quickly that the way to get into the United States
illegally is no longer through the airports, because they have been
effectively blocked. It's to get to Mexico and cross the land border
between Mexico and the U.S. Another reason to build the border fence.
Mr. KING of Iowa. I want to reiterate too the utilization of the
waiver. As I have tracked that through the news, I also commend
Secretary Chertoff for utilizing the waiver to go forward and build the
fence. As the gentleman from California references, the fence and the
triple barriers that exist down in the southwestern Arizona area, San
Luis, south of Yuma, I remember visiting there and asking the question
of Secretary Chertoff, We always hear the statement if you build, I
will show you an 11-foot ladder, you build a 20-foot fence, I'll show
you a 21-foot ladder.
I saw the fence down there, and as I asked this question, Has anyone
defeated this barrier, and it had to be asked a number of times, and
the answer came back no. When I was there, no one had defeated the new
triple fencing barrier that was constructed in the San Luis area where
the crossings have gone down from 138,000 to 4,000.
I ask the gentleman from California, are you aware that anyone has
defeated the triple barrier fence anywhere?
Mr. HUNTER. No. As long as you have a modicum of manning, that is if
you leave a fence totally alone, obviously a person can come in, sit
down for hours with welding gear and cut through anything, or bring in
heavy construction equipment and cut through anything. As long as you
have a modicum of manning. That is why you have the Border Patrol road
in between the fences, so the smuggler has to come across the first
fence, cross a high speed Border Patrol road, sit down with his welding
gear and work on the second fence, or carry that 22-foot ladder. Then
the question comes back to the person who makes that statement--
incidentally, that statement was made by Governor Napolitano, who is
the Governor of Arizona.
Now, let me see. She said, You show me a 20-foot fence, I'll show you
a 21-foot ladder. She derided the fence. And in her district where we
built the double fence at Yuma, we have brought down the arrest rate
from 138,000 to 4,000. So apparently the smugglers haven't read her
statement that they should have no problem with this fence.
But it does work and, incidentally, the other thing it does is it
leverages the Border Patrol. Because we were able to pull Border
Patrolmen off our fenced area and move them to other places on the
southern border. You don't need as many Border Patrolmen when you have
an impediment, that is when you have the fence in place.
So for those who say the question is, How many Border Patrol can we
get? You free up a lot of Border Patrolmen by having the fence.
Incidentally, you need to have that double fence because you trap the
smugglers in between the two fences.
I thank the gentleman for yielding and for his great work on this
important issue. We will continue to work together.
Mr. KING of Iowa. I thank the gentleman from California, who has been
the leader on this fence and made sure the first got built and is here
making sure that we get the last of it built. I just submit we don't
have to build exactly 2,000 miles of fence to get this all done. I
submit we build the Duncan Hunter 700/854 miles of fence and then we
will just keep right on building as long as they keep going around the
end. If they stop going around the end, we can stop building fence. If
they start going around the end, we'll start building some more.
Mr. HUNTER. I thank the gentleman.
Mr. KING of Iowa. I thank the gentleman from
California. There's a lot more to be taken up on that. As a matter of
transition on the cost of this border, we are spending $8 billion on
our southern border. When you calculate the cost of funding Border
Patrol and all their equipment and all of the costs that are associated
with that, as well as the costs of ICE and the enforcement that we have
along on the border, about $8 billion a year. That is $4 million a
mile. Now we can build interstate for that kind of money. Instead, we
just simply want to build a couple of fences with some sensors on it
and invest that money and get the return back in the first year.
As we recruit Border Patrol that come to work, I ask them to keep
your spirits up and get tied into the mission. Often there is a loss of
notion on that lack of mission if it's not clearly articulated. There
isn't a place to compromise the law. When someone violates it, we must
enforce it and follow through with prosecution. We need to put the
resources in your hands so you can do that. You are brave Americans
serving this country, serving us well. I go down along that part of the
border and sit down in nice quiet meetings with brave Americans that
are serving this country and I hear your stories. I hear them
anonymously sometimes. And I sit along the border in the dark at night
and watch and listen as the infiltration comes through.
I have got a sense of what you're up against. I'm sure I don't
appreciate it the way you do, being faced against it every day. I
appreciate the work, as this Congress does, and I appreciate the
gentleman from California coming to the floor.
I wanted to swing back to the energy piece of this, Mr. Speaker, and
as I talked about the different components of the energy pie, the
overall pie chart, our sources of energy, and I listed a whole series
of them: Gas, diesel, biodiesel, and nuclear, wind. The list goes on.
Not necessarily to repeat them all, but just to refresh in our eye the
things we are talking about here from the sources of energy that we
have.

[[Page H2843]]

I was in the process of making the statement that of all 435
congressional districts in America, there is one congressional district
that produces more renewable energy than any other congressional
district. That is the Fifth Congressional District of Iowa. We are in
the top three in ethanol production of all the congressional districts.
We are the top biodiesel-producing district of all of the congressional
districts. We are in the top one to four on wind. Perhaps today we are
third or maybe second on wind generation of electricity. If you add up
the Btu's we are converting into renewable energy sources, the Fifth
District produces more than anybody else. So we ought to know a little
more about it.
First of all, and I need to debunk some of the myths that are out
there. One of them is a myth, it is a myth that it takes more energy to
produce ethanol than you get out of the ethanol. That is a myth. There
was a college professor that did a study that went back and added up
all the energy it would take to produce the tractor and smelt the steel
and produce the rubber for the tires and transport the tractor and the
combine and the cultivator and the application equipment all the way to
the farm field. They calculated all of the energy that it took to do
that, as well as the energy it took to make seven passes over the
field, if I remember that number correctly. It didn't add up quite good
enough yet so they charged against the energy consumption to produce
ethanol, this is to raise a crop of corn, by the way, 4,000 calories a
day for the farm workers because it takes energy to keep them going.
When you get to that point, Mr. Speaker, you have to know that they
are grasping at straws, they are reaching pretty hard to try to pull in
as many ways that they can describe that there's energy consumption in
ethanol production through corn. Well, let me submit, Mr. Speaker, that
first of all, if you add all that up, then you can make anything so
inefficient, we couldn't possibly do it. But the corn is going to be
raised anyway. So that description isn't valid and it's not a rational
way to compare how much energy that we are getting out of corn versus
how much energy it takes to produce the equipment that raises the farm
crop.
If we are going to measure the amount of energy used to produce
tractors and combines that are used in the field, along with the diesel
fuel or the gas that is in the tractor and in the combine and in the
trucks that haul the grain away, then by the same comparison we have
got to look at the energy that is consumed when we produce gasoline out
of crude oil. It isn't just an inequation of a barrel sitting at the
refinery of Texas. It is all of the military that has to go over to
defend the oil fields. It's the anchor, all the energy it takes to cast
the anchor for the battleship and all the energy it takes to produce
weaponry of all kinds, and the F-16s that have to fly in the air and
the bullet proof vests and armored Humvees. How much energy does it
take to drive an army? Are they consuming 4,000 calories a day? Perhaps
they are. In fact, I'd submit more than that, as much as they are up
against.
If you add all that up, you can compare that to the energy it takes
to produce tractors and combines and energy in the form of ethanol out
of corn. But I will submit that that is a ridiculous path to go down to
try to prove something. I think that the study that said that it took
more energy to produce ethanol, the specious one about measuring the
energy it took to produce the tractor to farm the corn is a specious
study and it is invalid and it was grasping at straws.
When the same people go back and calculate what it takes to put an
army in the field and a navy in the sea and an air force in the air and
how much fuel to drive all of that, compare that and the energy you get
out of the crude oil versus the energy you get out of corn, we are
still going to look really good, although neither comparison is valid.
So what is valid is this. We are going to raise the corn anyway. We
have the oil out there coming out of the ground anyway. So what is
valid is each one of them has a commodity price, and as Adam Smith
said, the value of anything in the marketplace is the sum total of the
capital that it takes to produce it and the labor that it takes to
produce it. So when you add up the capital and the labor, and you look
at the price, the market price, you will have those two things
together.
For example, crude oil has gone up by the barrel from, not that long
ago, $50 a barrel, to $118 or $119 a barrel. That more than doubled
over the last year and 15 months or so.

{time} 2115

Why is that? Because of supply and demand. Because it has gotten more
scarce, because there is more demand on the oil, and because the cost
of capital and production and labor have gone up.
So we measure the value of the commodity in the marketplace. What
does it command when it is marketed as a commodity? What is corn worth
by the bushel, what is crude oil worth by the barrel? That is how we
determine what it is worth.
I will submit this, Mr. Speaker, and that is that if we put a barrel
of crude oil sitting outside the gates of the refinery, let's just say
in Texas, and we are going to have to refine that crude oil and do what
we call crack gas out of that crude oil, that takes energy to do that.
And the energy that it takes to crack one Btu out of gasoline out of
crude oil is 1.3 Btus of energy to do so.
If you put a bushel of corn sitting outside the gates of an ethanol
plant in Iowa, for example, anyplace in the corn belt, and you are
going to produce one Btu out of that corn in the form of ethanol, it
will take .67 Btus of energy input to get one Btu out in ethanol in the
form of corn.
If you do that in gasoline coming out of crude oil at the refinery in
Texas, you will use up 1.3 Btus to get one Btu back. It is almost, by
modern numbers, actually, twice as much energy consumed to produce
gasoline from crude oil as it takes to get ethanol out of corn. That is
a laboratory fact. It is not a negotiable one, it is not an opinion, it
is a laboratory fact.
And they worry about water consumption, how much water does it take
to produce ethanol for the amount of water that it takes to produce
gasoline. Cracking gasoline takes significantly, multiple times more
water than producing ethanol out of corn. Cracking gas out of crude
oil, a lot more water than ethanol out of corn.
So we take care of those two arguments. Those things stand up with
laboratories tests. Those are finite numbers. They are not negotiable.
They are a matter of scientific fact. It isn't even ``settled
science,'' in the way Al Gore would say his opinion is. It is
laboratory facts.
So, now we have this ethanol, and we have put it into the marketplace
and we have produced upwards perhaps in the last year somewhere near 9
billion gallons of ethanol. And that is putting a dent into the overall
supply. We are burning about 142 billion gallons of gasoline in a year,
so the 9 million gallons of ethanol is approaching that level where it
is significant in its contribution in keeping the cost of energy down.
But the argument comes back then to me and across the airwaves of
this country, Mr. Speaker, that we have high food prices because the
production of ethanol has taken corn off the marketplace and made food
prices higher.
Now, why is it that people that don't understand the law of supply
and demand when it comes to the cost of energy can all of a sudden
discover the law of supply and demand when it comes to food prices, and
then misinform themselves for the suitability of their own argument?
So it works like this: We don't consume a lot of field corn for human
consumption. Most of it, if it is not processed into some 300-some
different products, but most of the field corn is used in livestock
feed and it does get converted into food that way.
But here is how this works. In 2007 we produced 13.1 billion bushels
of corn. Of that, we exported 2.5 billion bushels of corn. That left
10.6 billion bushels back for us, 10.6 billion to use here
domestically. Of that, we converted 3.2 billion into ethanol, a little
over 9 billion gallons of ethanol. That left 7.4 bushels of corn for
domestic production. That 7.4 billion gets added back to it at least
half of the corn that we use for ethanol, because there is a high grade
animal feed product that is a by-product of ethanol production. That
would be about 1.6 billion bushel equivalent added back in.

[[Page H2844]]

So we end up with exactly, by my calculation here, 9.0 billion
bushels of corn to be used here domestically for animal feed, for
processing into the things that we process it into. And so the argument
would be, well is that 9.0 billion bushel, is that more or less corn
than we normally have for domestic production?
We pushed our production up, and over the last 6 years we have
produced an average of only 10.3 billion bushels of corn, and we have
exported about 2 billion. So that takes us down to 8.3 billion bushels
of corn available in an average year. Last year there was 9 billion
bushels available. And yet the people who don't understand the law of
supply and demand when it comes to energy seem to think that even
though we have more domestic corn available on the market here in the
United States, even after we exported more corn than ever before,
somehow they think that is what is driving up food prices.
Mr. Speaker, I submit food prices are driven up because of energy
costs, not because of the supply and demand on corn, because we have
more corn. And so all we have to do is look at the numbers to
understand this and realize the cheap dollar has been driving up
commodity prices for food, it has been driving up gas prices, it has
been driving up the cost of defense.
I would be happy to yield to my friend from California.
Mr. HUNTER. I thank my friend for yielding. He truly is the resident
expert on ethanol production and it has been very interesting to listen
to him.
Another aspect of providing enough energy, of course, and becoming
energy independent, which really is a national security issue at this
point, is that we have to use all of our sources. And it is important
for this body and for the other body, for the U.S. Senate, to pass
finally permission for us to drill in Alaska.
Right now we have got an abolition on drilling, a lot of impediments
to moving forward and increasing the amount of petroleum product that
is available to the American people. If we drill in Alaska, and,
incidentally, the Alaskan pipeline has not hurt any wildlife species.
You can see caribou rubbing their summer coats on the Alaskan pipeline.
They are that worried about it.
If we drill in Alaska, we are going to find new oil. We will also be
able to utilize the production that is available there. And every drop
of oil that we produce in this continent is oil that we don't have to
worry about coming through the Straits of Hormuz. That is that narrow
channel of water where the Iranian gunboats came out and harassed an
American naval ship here a couple of months ago, where we are
constantly watching a short-fused situation with very unstable
countries, monitoring that particular dangerous part of the world.
Having energy independence for this country is a very, very important
part of national security, and we should open up Alaska so we can
utilize in a very responsible way the petroleum resources that lie
under that great State.
I thank the gentleman.
Mr. KING of Iowa. I thank the gentleman from California for bringing
his background and expertise to this. Sometimes there is a different
view on things between California and Iowa, and I don't find that to be
the case when it comes to common sense, particularly when it has to do
with energy production and when it has to do with the immigration
issues that are there.
I have, of course, traveled to ANWR and seen the situation up there.
I would add also that the people that believe that we are going to run
out of energy supply here in the world and so somehow we should not tap
into the known energy, what would be a better time to go where we know
we have a lot of energy than right now, get up to Alaska and drill
that?
We are hearing also announcements of huge energy finds around the
globe. For example, we know that there are tremendous reserves of oil
off the West Coast of Africa, and offshore is a good thing in that part
of the world because it is actually easier to provide security offshore
than onshore in some of those areas. Brazil has announced two huge
crude oil finds, oil fields, there. And with the Chevron find in the
Gulf of Mexico a year-and-a-half or so, it was another huge find. And
they announced the other day there are 3.4 billion barrels of oil in
the North Dakota and Montana area, in that overthrust area they were
drilling in 20 or 25 years ago. Now they go down about 10,000 feet and
they have to drill then from there horizontally with new technology,
and they can draw the oil out. There are 3.4 billion barrels of oil up
there, along with one of the world's largest oil supplies, the oil
sands area in northern Alberta, which we hope to build a pipeline down
and tap that in and refine it here in the United States. We have got
that going on. We have a nuclear power plant under construction in
South Carolina today. So we are taking some steps.
But the barrier here in this Congress, the leadership that is
provided currently with the people that hold the gavels, it is all
about cutting down on the supply of energy and raising the price,
because I think that they believe, and maybe the gentleman from
California is better tuned into this myopic belief, but I think they
believe that if they can raise the cost of energy and take supply down,
people will ride bicycles and park their car. And that doesn't help
grandma very much in January in Iowa when she is 10 miles away from
town. But if they ride bicycles more and then drive up the cost of
everything we do, somehow that saves the environment and saves the
planet. That is what I hear coming out of the voices in Congress.
I would ask for the judgment of the gentleman from California.
Mr. HUNTER. Well, I would say to my friend, I think he has made an
excellent point. The way you bring down the price on any commodity is
to increase the supply. And we have got a number of leaders in this
House who have undertaken, if you look at their legislative record,
undertaken a major campaign to stop the supply, to strangle the supply,
to diminish the supply of petroleum production. And every time we take
wells out of production or we don't produce, where we know we have
known reserves, then we are handing part of our future to people in
another part of the world who don't have America's best interests at
heart.
Mr. KING of Iowa. As the gentleman knows, my view on this, and I
think we would concur, is that I always say grow the size of the energy
pie. Take every slice of that pie. Let's produce more domestic gas,
more domestic diesel fuel and more cleaning burning coal. Let's keep
wind energy going, and whatever we can do economically with solar, and
expand the nuclear. I would expand the hydroelectric if I could do it
and add the ethanol and biodiesel to it. I am sure I am leaving
somebody out. But if you can find a way to produce energy and get it
into the marketplace, biomass is another one.
We have got some closed systems coming now where we can take an
ethanol plant and ship corn in there, feed the corn; the glutton or the
dried distiller grain comes out and gets fed to cattle in the feedlot;
it is converted to beef; and then the manure goes into biomass and
creates the energy that drives the ethanol plant. It is a closed
system.
We are developing systems now where we can take the byproduct and
convert that into a high concentrated CO2 environment and
produce photosynthesis which traps the carbon gas out and turns it into
cellulose and energy. We are only in the first phase of renewable
energy production, and, as the technology develops, each piece of it as
it comes forward to me is just fascinating how far we will be able to
go.
Mr. HUNTER. I appreciate the gentleman letting me participate in this
discussion. I appreciate his expertise. I know we will work together to
be sure we increase the supply of energy and fuel. I thank the
gentleman.
Mr. KING of Iowa. I thank the gentleman from California.
Mr. Speaker, I just hope that we all recognize that it is getting
towards evening here in Washington, D.C., and there are some folks that
do go off and go to bed or call it a day. The gentleman from California
has worked diligently in this Congress for more than 20 years, and I
recognize that and appreciate it.
As I move forward here on the energy policy, I wanted to reiterate
this equation so that the point on ethanol efficiency, Mr. Speaker,
does come home in a clear way. It is this: We have more corn available
to us domestically now than we had as an average over any time in the
last 20 years that I can come up with for records.

[[Page H2845]]

It works like this: In 2007, we produced 13.1 billion bushels of
corn. I believe that is the largest crop ever. Out of that, we exported
more corn than we had ever exported before, to foreign countries, just
shipped it off in the form of grain. We exported 2.5 billion bushels of
corn. That left us 10.6 billion bushels left, and out of that we took
3.2 billion bushels and produced ethanol with it, around 9 billion
gallons of ethanol.

{time} 2130

And, we get to add back in--that left 7.4 billion bushels for
domestic consumption, which is real close to the average available for
domestic consumption over the last 6 to 7 years, but half of the corn
that went off to be produced into the 9 billion gallons of ethanol gets
added back into the formula because it goes back into high-quality
animal feed. So, we end up with an effective remaining amount of 9
billion bushels of corn into the domestic market here in the United
States where the average previous years in the same decade comes to
about 7.6 billion bushels of corn available for domestic consumption
here in the United States.
So, we increase the supply of corn for domestic consumption even
though we exported more corn than we had ever exported before, even
though we produced 9 billion gallons of ethanol. And all of that, and
we get the allegation made by the slightly informed that food prices
are up because we have turned more corn into ethanol and that has hurt
us. It has actually been a big help.
And what we can do is we can take that number and try to be logical
about it and realize that the high price for food comes from two
things. One is the cheap dollar; the cheap dollar that if we would take
the price of energy up--if we would uphold the value of our dollar,
shore up the value of our dollar, we could take perhaps one-third of
that cost out. And so the gasoline that we are paying $3.50 for today
would be worth maybe about $2.15 if we could shore up the value of the
dollar. Corn that sold cash in Iowa last week for $6 a bushel would be
around $4 a bushel. Say it is 55 or 60 cash today, it would take it
down to below $4 a bushel if we could take one-third of that out by
shoring up the dollar. It would slow down some of our exports and it
would change some of the equations, but it would add more stability
into overall markets, and we should do that.
But there is a great big future for corn-based ethanol. And it is not
a full solution by any means; and in fact, if I look at our corn
production and look at our gasoline consumption, I have to think that
somewhere in that 13 or 14 percent category is about where we end up,
Mr. Speaker, of how much of the gasoline in this country we can
substitute ethanol for. But that is a part of it. And if we can get 13
or 14 percent, it surely was worth it to start building wind chargers
to produce electricity when we thought we would have to cap that off at
about 15 percent because it is not a stable enough supply to produce
all of the energy that we could have. And that is a tremendous capital
investment, Mr. Speaker.
So, this corn does have a future. And it has got a future in ethanol,
and it is a future that needs to be sustained and maintained by this
Congress. The blenders credits have got to stay in place, and we have
got to maintain the import duty on Brazilian ethanol, because if we
take that off, we will be building infrastructure to produce more
ethanol in a place like Brazil. They can produce, they can build their
own infrastructure with their own capital. We need to put capital back
into the corn belt and into the ag areas of the United States so that
we can build out this renewable energy infrastructure. If we do that,
we will have an industry there that will provide renewable fuels over
and over again.
And the people that argue that corn ethanol has a carbon footprint
know the worst that you can say for it is it is carbon neutral, because
the carbon that is sequestered by the photosynthesis is released, some
of it, back in the atmosphere in the form of CO2. But we can
convert that CO2 into a useful byproduct. We are in the
process of developing it. I believe we have the science to do that. We
don't have it up to the industrial proven model yet.
But I would argue this, Mr. Speaker: That about $5.50 bushel a corn,
by the time we process not quite 3 gallons a bushel out of that corn
into ethanol we get about $7 worth of ethanol out of that bushel of
corn. And then when we add to that where through the fractionization
process we crack out the germ, and out of the germ we take the oil. And
the oil, some of it is there, it is for food grade consumption high
quality oil that is worth about 85 cents a pound now. And then we get a
lower grade oil that goes into biodiesel. And so we could take the corn
oil, some goes to human consumption, some goes into biodiesel. That
taking the corn oil out allows then the remaining grain to leave a
residue for a dried distiller's grain that can then be digested by hogs
and poultry because the oil is out. It is the oil that gives them a
problem.
So if we do the fractionization process of the corn and take the germ
out and take the oil out of the germ, when we are done, this is a more
useful feed than what it is today, it is more versatile, because it can
go to a lot of different livestock where right today cattle have an
advantage. $7 worth of ethanol and a bushel of corn.
By the time you add up the dried distiller grain feed amount, and by
the time we take the CO2 and convert that into a useful
byproduct by using photosynthesis and converting it into biodiesel and
the residue of that going back as a feed grain, we capture it all. We
capture it all and roll it into something useful. And the short back-
of-the-envelope calculation comes to about $7 worth of ethanol in a
bushel of corn that is worth about $5.50 and another $7 worth of high-
value product that we used to call byproduct.
When the byproduct gets to be worth more than the primary product,
then the byproduct is no longer a byproduct. We could actually get that
point. And, I had better not utter those words into the Congressional
Record, Mr. Speaker, but we have made significant progress. And the
value added on this bushel of corn at about $5.50 turns into about $14
if we do this right, with no carbon footprint, a carbon plus instead of
a carbon neutral. No downside on this. And it takes half the energy to
produce a Btu in the form of ethanol out of the corn as compared to
gasoline out of crude oil. It takes a lot less water.
And, by the way, the water that it takes to grow the crop, the folks
that are critical, they will say they will charge all the water off as
if we irrigated that corn. About 12 percent of the corn in America is
irrigated; the balance of it is just God's watering it for us. And so
it is going to rain anyway. If it is going to rain anyway on that
field, you can't charge that water usage against ethanol production,
Mr. Speaker. It defies common sense to see such logical contortionisms
going on on the parts of the critics that will not stand down here and
lay out fact against fact against fact.
Facts are, we have more corn available for domestic consumption than
ever before. We have exported more corn than ever before. And, we have
produced, we have turned more corn into ethanol than ever before. We
have done all of those things all in the same year, and the inflated
costs of food has not related in a significant way to the overall cost
of grain. It is more related to the cheaper dollar than it is the
supply and demand of the commodity corn.
And so, Mr. Speaker, I submit that we are on the right path, and we
need to put more into the infrastructure and we need to produce more
ethanol. And, if we can do that, we are helping to solve this problem.
And, by the way, food prices appreciated by about 4.9 percent over the
last year. Energy prices, Mr. Speaker, appreciated 18 percent over the
last year. And a significant portion of the food price appreciation,
the increase came because of energy price increases. The cost of energy
has a lot more to do with the cost of food than the supply and demand
of that food does, because an energy component goes into everything,
the distribution and the processing of it, as well as the raising of
it.
And so how high would gas be today if you took 9 billion gallons off
the market as we put 9 billion of ethanol in? If you took that 9
billion gallons off the market, how much more costly would gasoline be
today and how might it change the equation?
I will submit, Mr. Speaker, that food is cheaper today because of
corn-based

[[Page H2846]]

ethanol. And I would submit that the energy we have today is cheaper
because of corn-based ethanol; and, that this equation works out very
good for the farm bill, too, because, for example, in 2005, there is a
government program, a subsidy that has been there since the 1930s, it
paid out in 2005 $6.8 billion in counter-cyclical and loan deficiency
payments. The counter-cyclical and LDPs paid out a total of $6.5
billion in 2005. By 2006, the subsequent year, commodity prices were up
high enough that that zeroed out. There was no $6.8 billion going into
counter-cyclicals and LDPs. And if you charge that all to ethanol
demand--and I have already made the argument you don't. But if you do,
if you sustain and you are on the side of this argument, Mr. Speaker,
that it really was the consumption of corn through ethanol that drove
up the price, then you have to also argue that the $6.8 billion in farm
subsidies disappeared because of ethanol.
So, at no cost to the taxpayer and a program that had been there in
some form or another since the 1930s, we did pay back in that same year
$3 billion in blenders credit. So there was a net savings to the
taxpayers of $3.8 billion out of the $6.8 billion that was subsidized
the year before. That is pretty good, too.
I don't know of a way that we can do this calculation in a macro
national perspective and not come up with corn-based ethanol as a great
big plus for the country. It is more energy. It doesn't reduce our food
supply, at least by the numbers that we have. Now, if we go overboard,
it can. And it doesn't taken away from our export of corn. We still
exported more corn than ever before. We have more corn available on the
market. It takes about half as much energy to produce a Btu out of corn
at the ethanol plant as it does to produce a Btu of energy in the form
of gasoline at a refinery out of crude oil.
All of these numbers that I produced here are based in fact, and I
can anchor the foundation numbers down by laboratory numbers, Mr.
Speaker. This is a picture of the real facts, and I challenge those
folks who disagree to come up with something that is solid, a
calculation. Give me something that is empirical. Don't give me your
feelings, don't give me your senses. Don't say, gee, I just feel this
or I feel that. Look at the whole picture, look at the big picture, but
look at the composition of the numbers, build a formula there, and see
what it does for America. We are on the right track, not the wrong
track.
I recognize that the gentleman is here from Maryland who has the next
special order. In that case, and out of deference to him, I would, Mr.
Speaker, thank you for your attention here tonight and I yield back the
balance of my time.

____________________