[Congressional Record Volume 154, Number 71 (Thursday, May 1, 2008)]
[Senate]
[Pages S3655-S3689]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
FAA REAUTHORIZATION ACT OF 2007
The PRESIDING OFFICER. Under the previous order, the Senate will
resume consideration of H.R. 2881, which the clerk will report.
The assistant legislative clerk read as follows:
A bill (H.R. 2881) to amend title 49, United States Code,
to authorize appropriations for the Federal Aviation
Administration for fiscal year 2008 through 2011, to improve
aviation safety and capacity, to provide stable funding for
the national aviation system, and for other purposes.
Pending:
Rockefeller amendment No. 4627, in the nature of a
substitute.
Reid amendment No. 4628 (to amendment No. 4627), to change
the enactment date.
Reid amendment No. 4629 (to amendment No. 4628), of a
perfecting nature.
Reid amendment No. 4630 (to the language proposed to be
stricken by amendment No. 4627), to change the enactment
date.
Reid amendment No. 4631 (to amendment No. 4630), of a
perfecting nature.
The PRESIDING OFFICER. The majority leader is recognized.
Mr. REID. Mr. President, the work done on this piece of legislation
to bring it to the floor is a good piece of work. Democrats and
Republicans worked together to move toward solving one of America's
major problems, and that is dealing with our aviation system. Chairman
Rockefeller, Senator Inouye, Senator Baucus, Senator Stevens, Senator
Grassley, Senator Hutchison, and their staffs understood that ensuring
the safety and efficiency of America's air traffic is too important to
fall victim to politics, slow walking, or obstruction. It even appeared
for a while that this bill was on the path to a relatively smooth and
easy final passage.
But now our Republican colleagues have signaled that they plan to let
this bipartisan legislation fall victim to more obstruction. We could
have moved to the bill yesterday, but the Republicans wouldn't let us
do that. They forced us to spend more valuable legislative time not
legislating, not trying to strengthen our country for the American
people but simply overcoming procedural roadblocks that have been
thrown at us time after time.
[[Page S3656]]
As we have said on a number of occasions, but certainly it is worth
saying again, Republicans broke the 2-year filibuster record in the
history of this Senate in just 10 months. We are now up to 68
filibusters. That is not normal filibustering, it is filibustering on
steroids.
Democrats want to change our country for the better. We want to
change the status quo. We have an economy spiraling into recession. Gas
and oil prices are at a record high. We have the war in Iraq that 70
percent of the American people want to end. The problems we have faced
and now face can't be solved easily.
But it would not be solved at all if Republicans refuse to let us
legislate. The distinguished minority leader raised questions about
offering amendments to the aviation modernization bill. As I said
several times yesterday, we welcome their amendments. We want them to
offer amendments. We understand there is a Bunning amendment dealing
with turning coal into aviation fuel. I don't know much about that, but
it is something that appears to be germane and relevant to the bill. We
should start to debate that amendment. But it appears no matter what I
suggest, it is obvious the Republicans don't like this bill and are not
going to let us pass it.
It is my understanding that today they are concerned about at least
two provisions in the bill. One deals with strengthening the passenger
rail system we have in America and also doing something about the
depleted highway trust fund, which is leaving States with no money to
do road repairs, construction, and modernization. If that is the case,
it seems to me the logical thing to do is to offer an amendment to take
those provisions out of the bill.
Long ago, when I was an assemblyman in the Nevada State Legislature,
it didn't take long to understand that if you don't like something,
just move to take it out. If you can muster the votes, that works. If
your amendment doesn't pass, at least everybody knows you have tried.
Here the Republicans don't even try. They want to just kill things by
doing nothing.
I told my Republican counterpart that Democrats are making every
effort we can to allow amendments to be offered. We welcome relevant
amendments on both sides of the aisle. That is how the legislative
process is supposed to work. I even offered to the Republican leader
that we can sit down and let him help me be the gatekeeper of what
amendments should be offered. That is fair.
Do I want to avoid amendments that have nothing to do with aviation?
I don't even care much about that. I want to move this bill forward.
The Republicans' obstruction and claims of unfair dealings are not
reflective of the facts or reality. I made it clear that the amendment
process will be fair, open, and take place in the light of day. This
legislation is far too important to fall victim to the gamesmanship we
are now seeing. Air travel is about getting from point A to point B,
such as going from Las Vegas to San Francisco or from San Francisco to
Chicago. That is what it is about--connecting to family and friends,
getting goods to businesses, and connecting Americans to the global
community.
The Federal Aviation Administration is facing challenges like they
have never faced before. A record 770 million passengers flew on U.S.
commercial airlines in 2007--nearly double the number who flew just 20
years ago.
If these trends continue, the FAA told us we will have 1 billion
passengers in just 12 years.
Las Vegas-McCarran International Airport--the fifth busiest in
America--now hosts 4 million passengers every month. At this rate,
McCarran will reach maximum capacity in the next 3 to 5 years.
Every American who flies understands what this new congestion means:
longer lines, more delays, and a more stressful, less efficient trip.
If growth in air travel in Nevada and throughout America is managed
correctly, it represents a tremendous opportunity for airlines,
tourism, and our economy. But the risks we face if we don't bring our
aviation infrastructure up to speed are clear: Americans could be put
at greater risk, our economy could suffer, and air travel could grind
to a halt.
This Aviation Investment Modernization Act will help ensure that we
manage this growing challenge. It will help passengers take off sooner,
land safer, help commerce flow with fewer interruptions, and help
carriers lower their fuel costs--which will save us all money.
The Aviation Investment Act will make air travel safer by upgrading
aging airport infrastructure, enhancing oversight of airlines and the
Federal Aviation Administration, and improving runway safety. There was
an article within the past week that most airline accidents--the close
calls--are on runways, not in the air.
Right now, the GPS in your car is more sophisticated than the system
that guides your flight in an airplane. That is why this bill
modernizes an obsolete air traffic control system with modern
technology. That is why this bill requires airlines to give passengers
better information about arrivals and delays. That is why the bill
incorporates elements of the passenger bill of rights to protect
consumers and deal with the most egregious flight delays and
cancellations. That is why this bill does things that make air travel
safer.
As Americans take to the skies in record numbers, they deserve to
know the Government is doing everything possible to keep them safe.
This legislation will give the American people that confidence. It will
also make flying not only safer but less stressful, more efficient, and
more enjoyable.
We must not let a crumbling infrastructure grind our economy to a
halt. That is what it is doing.
I urge my colleagues, once again, to put politics aside, put
obstruction aside, and work with us to pass the Aviation Investment
Modernization Act.
Mr. President, if somebody wants to offer an amendment to this bill,
they can come down and do that. They can play all the political games
they want, saying: Senator Reid filled the tree. This is something that
is way inside the beltway, Mr. President. On this vehicle now before
the Senate, people can offer amendments. All they have to do is come
and give us an idea of what the amendment is. I have been in the Senate
a long time, and it is no new theory that you would like to know what
the amendment is. We always give our amendments to the minority and say
here is what it is going to be. They should see it firsthand. This does
not prohibit them from doing that.
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. REID. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Motion to Commit with Amendment No. 4636
Mr. REID. Mr. President, I move to commit the bill to the Finance
Committee with the instruction to report back forthwith, with the
following amendment, which I send to the desk.
The PRESIDING OFFICER. The clerk will report.
The assistant legislative clerk read as follows:
The Senator from Nevada (Mr. Reid) moves to commit the bill
to the Committee on Finance, with instructions, with the
following amendment:
The provision of this act shall become effective 2 days
after enactment.
Mr. REID. Mr. President, I ask for the yeas and nays on the motion.
The PRESIDING OFFICER. Is there a sufficient second?
There is a sufficient second.
The yeas and nays were ordered.
Amendment No. 4637
Mr. REID. Mr. President, I send an amendment to the desk.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:
In the amendment, strike ``2'' and insert ``1''
Mr. REID. 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. GREGG. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
[[Page S3657]]
Spending Record
Mr. GREGG. Mr. President, I rise to respond to some attacks relative
to my integrity which were run today in a New York newspaper--I think
it was the Daily News--which I presume were energized and orchestrated
by the staff of the leadership--the Senate office of the senior Senator
from New York. The editorial could not have had the fact pattern that
it had, had it not been fed that information from the senior Senator's
staff. So I think it is appropriate to respond to it.
It implies, obviously, that I am inconsistent in my views on how I
approach spending in this Congress. I think that will come as a
surprise to most people in this Congress because I doubt anyone in this
Congress--I am sure there are a few--does not think my record in trying
to control spending and having some resistance to spending which I feel
is inappropriate is fairly strong.
As chairman of the Budget Committee, I tried to discipline spending.
I tried to make our Government more affordable for our children. I
tried not to pass on to our children debts which they should not have
to bear so our children can have the opportunity to live as fulfilling
a life and have as high quality a life as we have had.
There is in this bill a proposal to spend $1.6 billion on an air
train to Kennedy Airport. That is not an aircraft issue. It is clearly
an add-on. This proposal is, ironically, paid for using the Tax Code in
a very ingenious way. It gives a credit to the State of New York, or
the city, for taxes which they don't pay over a period of time, which
is fairly extensive. I think it will run into the period 2020. That
credit totals about $1.6 billion, $1.7 billion. It is, under any
scenario--I did not use this term when I spoke about it first, but I
will use it now--it is under any scenario an earmark, and not a very
good earmark, to say the least.
The representation is that my opposition to this is an attack on the
efforts of this country to address the very serious and legitimate and
appropriate concerns of the city of New York that resulted from 9/11.
After 9/11, the people of New Hampshire and the people of this Nation
were committed and remain committed to making sure the city of New York
is made whole, to the extent it can be. Obviously, it could never be
after such a horrific event. We in our State were happy to take our tax
dollars and put them toward the city to try to address those problems,
and I voted for that. And we in our State were happy to support efforts
to rebuild and continue to be happy to support efforts to rebuild
Ground Zero because that is a place which has taken on sacred meaning
to our Nation. But we are not interested, in New Hampshire--and I
suspect most American citizens are not interested--in using dollars
which were supposed to be used for 9/11 to help out some other, maybe a
legitimate need--but I don't know whether it is--in the city of New
York, and that is building a train. I call it the train to nowhere. It
is a bit of an exaggeration, but since I was trying to put it in the
context of an earmark that was of a questionable purpose, that seemed
like a reasonable term to use. That has become sort of like the term
``Xerox'' when you talk about an earmark about which you have serious
questions. But building this air train to Kennedy Airport--by the way,
I understand there is some significant disagreement within the city
about whether it should even be built, but certainly it should not be
on this bill as an attempt to basically get around an authorizing
process or a process which would air whether this earmark is
appropriate.
It should also not use a brand new exercise in tax policy, which is
totally inappropriate, of basically using the tax laws in a way that
creates an earmark by saying that you get a credit for a tax you don't
even have to pay. That is very bad precedent--horrific precedent, quite
honestly.
This earmark should see the light of day, and I don't think it can be
defended on the grounds of 9/11. In fact, I think that really does
serious damage to the historic and very human perspective of 9/11. To
try to defend building an air train to Kennedy Airport and stand behind
9/11 as your reasoning, and then claim, in a way that is most
inappropriate, in my opinion, if somebody opposes that proposal, they
are attacking the memory and the purpose and the sacredness of the 9/11
event and the Ground Zero reconstruction, is just, even by New York
standards of exaggerated politics, carrying it a step too far--more
than a step too far, in my opinion. But that is what was done here.
An earmark was created for something which has only marginal
relationship to even downtown Manhattan--I guess you have to get there
from Manhattan, so I guess it has a relationship--certainly no nexus
with Ground Zero from the standpoint of an air tram construction to
Kennedy Airport. Using the tax laws in an abusive way to generate this
earmark and then claiming, when anybody raises the question of the
legitimacy of it, that they are somehow acting in a way that is
inconsistent with the commitment to the rebuilding of New York after 9/
11 and they are degrading the name of the 9/11 event is beyond the
pale.
But that seems to be the goal, the style, and the approach of at
least the people who fed the information to the paper--which I presume
was the staff of the senior Senator from New York. Maybe it was not his
staff. I would like him to come down here and deny it if it wasn't. I
would like him to come to the floor and deny it if he didn't basically
give this information and set the tone of this position because, very
clearly, in my opinion, he has.
Let's return to the fact pattern as it exists. I will stop using the
term ``train to nowhere'' because I can understand how that might
irritate. I will accept that term was probably inappropriately applied.
I will call it an earmark, a very questionable earmark for a lot of
money which does not flow from the original commitment, in my opinion,
to the rebuilding of New York--which the citizenry of America made and
which we were happy to stand behind.
In fact, ironically, the plans for this train, this elevated train,
were begun in 1998, and the actual commitments that this train would go
forward, as I understand it, were discussed as early as 1988. The claim
this is tied into Ground Zero is to extend credibility quite a bit, in
my opinion. To hide behind that and use it in such a personal way which
basically questions another Member's integrity is obviously
inappropriate.
I think the Senator may have the votes to support his proposal to
raid the Tax Code for $1.6 billion. Maybe he has the votes to do that.
But it should not be on this bill. It is not an airplane issue. I can
tell you right now, if I have anything to say about it, this bill is
not going to move forward as long as it is on this bill.
It had not been my intention to engage at this level, but, as, you
know, people from New Hampshire know how to play politics. We know how
to deal in this Chamber as well as people from New York. We may be from
the country, but we know how to engage. It appears engagement has been
called upon, so let us go forward and see who is right, see who has the
equities on their side, and determine whether the American people
believe building a train which was designed in 1988, was committed to,
I believe, in 1998, about which there is considerable discussion
whether it should even be going forward, which is an elevated train to
an airport in, I believe, Queens, is an appropriate use of $1.7 or $1.6
billion of their hard-earned income. Let's see what happens on that
issue.
I yield the floor.
Mr. ROCKEFELLER. Mr. President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. ROCKEFELLER. I ask unanimous consent that the order for the
quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. ROCKEFELLER. Mr. President, I remember those days in West
Virginia when all the major airlines operating large jet aircraft
served all of West Virginia's airports--jets, actual jets coming into
West Virginia. Airline deregulation was a terrible mistake. It changed
the very nature of air travel in this country for all. For millions of
Americans in large urban areas, it ushered in an era of affordable air
traffic. A trip to New York and Los Angeles went down. In fact, at a
number of points, it became much cheaper to go
[[Page S3658]]
to Los Angeles from New York than to go from West Virginia to
Washington. But for West Virginia communities, it meant a loss of
service and convenience and often higher prices. It seemed to me that
the big jets disappeared from West Virginia within days of
deregulation. I remember those nice American, United, and Eastern jets
sitting out there on the tarmac, people piling on. Deregulation--boom,
they were gone.
For 30 years, small and rural communities have had to cope with very
limited and unreliable service. The Presiding Officer knows exactly
what I am talking about. Over the last several years, these problems
have been exacerbated by the weakened financial condition of the U.S.
airlines, which is what this whole effort to get a bill going is about.
After September 11, dozens of communities saw a dramatic decrease in
the level of air service. It was measurable, noticeable, and
depressing. Many lost service altogether. As the industry recovered
from the dramatic downturn in the air traffic that tragic day sparked,
small communities did not see the benefits of that resurgence because
once they dropped something, it was easier to keep it dropped rather
than to help.
Small community air service is facing an unprecedented crisis. If we
fail to act to address this problem, dozens of small communities across
our Nation will face a future without air service. Consider that for a
moment--small communities, viable industries, institutions, people who
count. Americans are born equal, but then some don't have air service.
That is what we have now. Without access to reliable air service, we
throw into question their economic future.
I do not come to the Senate to represent the diminution of
possibilities for West Virginia's economic future. I have spoken about
the weakened financial condition of our major airlines. But we must
also recognize that small regional carriers that provide the air
service to rural States such as West Virginia and Montana and parts of
Ohio, I am quite certain, also provide the vast majority of air service
to midsize communities across the country, and they are teetering on
the brink of collapse because of high fuel prices.
As Senator Baucus knows all too well, small airlines across the West
have folded, leaving at least 17 communities with no air service at
all. Seventeen communities would sort of make up the entire State of
West Virginia. That is a terrible blow. So few regional airlines are
willing to initiate service to small, isolated communities that, when
one withdraws service, it is very hard to find replacement air service.
In most cases, it is impossible. Hundreds of small and rural
communities across our country are facing drastically reduced air
service because of this financial turmoil in the industry. Even in the
best of times, these communities face a difficult time maintaining and
developing new air service options. Today, their challenge is
preventing the complete loss of air service. That is effort No. 1: Hold
on to whatever you might have. No matter if it is one flight a day,
hold on to it. Fight for it.
I strongly believe the Federal Government must continue to assist our
most vulnerable communities stay connected to the Nation's aviation
network, a network paid for by all Americans.
The reduction or elimination of air service has been devastating in
terms of its effect on the economic well-being of many of our
communities across the country. Having adequate air service is not only
a matter of convenience, it is a matter of economic survival. Without
access to reliable air service, businesses will not locate their
operations in these areas of the country, no matter how attractive the
quality of life or the quality of the workforce. We have, for example,
extremely low housing prices, low property taxes, and an
extraordinarily highly productive workforce, with an average in
manufacturing of 1 percent annual turnover. That is almost unheard of.
Airports are economic engines that attract critical new development
opportunities and the people who can make those things happen or
continue to grow.
West Virginia is a very good place to do business. Toyota and a
number of other large industries, chemical and otherwise, have found
that out. I can proudly state that countless large U.S. and
international companies have facilities in my State. I can even point
out that 20 Japanese companies have industries in the State of West
Virginia, three in Wayne County, which the Presiding Officer is
familiar with. From West Virginia, a business traveler can get to seven
airline hubs and from these seven cities can get to any point on the
globe. One-stop service to Tokyo, London, Dubai is critical if my State
is going to compete in the global economy. West Virginia has been able
to attract firms from around the world because corporate executives
know they can visit their operations with ease. That is why we have air
service. Rural and smalltown America must continue to be adequately
linked to the Nation's air transportation network if its people and
businesses are to compete with larger urban areas and around the world.
When Congress deregulated the airline industry, we promised small and
rural communities we would make sure they would remain connected to the
aviation system. We have failed in our commitment to those promises.
The Essential Air Service Program, which Congress established when we
deregulated the airline industry, is not a huge program, but it
provides money to attract airlines into smaller communities and is
incredibly valuable.
But, on the other hand, the essential air service has never met the
true needs and expectations of rural air service or the necessary
requirements of rural air service.
In West Virginia, the essential air service has often been plagued by
high fares and limited, sporadic service. For 10 years, I have worked
to strengthen small community air service. I do that because I
represent a rural State with hard-working people who have an enormous
desire to succeed and to work and are deprived of what many other
Americans take for granted. That is not fair in Internet connection;
you cannot have a rural and urban divide. It is just as true in airline
service; you cannot have urban doing well, rurals being left out
because we are all Americans, all created by God to be equal.
So I have worked to strengthen small community air service. In the
Aviation Investment and Reform Act for the 21st Century, which Congress
enacted into law in the distant past of the year 2000, we began to
address the need to improve air service in small and rural communities.
I, along with many of my colleagues, supported the creation of
something called the Small Community Air Service Development Pilot
Program, a competitive grant program to provide communities with the
resources they needed to attract new air service to their town. We try
everything we can. We try absolutely everything we can. Over 100
communities now have used these grants to secure and retain new air
service options. That is good.
I wish to highlight two success stories which happened in my State.
Charleston received money under the program I have described and has
used it successfully--Charleston is our capital--they have used it very
successfully to attract a new service connection for our chemical
industry to Houston. Why is that important? Well, our chemical
companies do a lot of the training of their people in Houston and then
they come back and they work in our chemical companies. Air service to
Houston gave West Virginians an important gateway, in addition,
therefore, to the markets of Latin America.
Over the past 2 years, Tri-State Airport in Huntington has been
reborn because of the money it received under this Small Community Air
Service Development Grant Program. Prior to attracting a low-cost
charter operator, the airport had seen a steep decline in the number of
passengers using the airport. With fewer passengers, airlines cut back
flights. Fewer flights meant fewer passengers. It was a death spiral.
Once the community was able to secure a grant, matched with almost as
many local dollars, airport officials were able to attract a new
carrier that served the critical markets local residents wanted. For
the first time in 20 years, large jets roared off the runways in West
Virginia, in Huntington. The airport will have 100,000 passengers pass
through its gates for the first time in decades.
Now, that is not very impressive if you are from New York or Los
Angeles,
[[Page S3659]]
but in West Virginia it shakes the world, and it gives people new hope.
I was there when all this happened, and you could see a new sense of
vigor and determination in the population. Air service attracts
community ambition.
Improving air service must be a collective effort. Communities are
most successful in creating new air service options when everyone--
including the Federal and the State governments, airports, airlines,
businesses, and citizens--works together to attract, promote, and use
the service.
One of the things we learned the hard way in West Virginia was you
cannot treat an airport similar to something which is out there which
people will automatically go to. We used to have a lot of our people
from Charleston driving all the way to Cincinnati and actually not
understanding that the cost of traveling to Cincinnati and the fuel and
the overnight and all the rest of it actually did not give them that
much of a financial break, but they looked at the cost of the airline
and off they went. So 16 percent of Charleston's traffic disappeared.
I am now proud to say West Virginia communities have been able to use
this important program to rethink their air service needs, to think
about marketing airports. You market airports like you market anything
else. People have to be aware of it. You have to attract people to it.
It is not something which is there. It is something which has to sell
itself. LaGuardia does not have to do that. Newark does not have to do
that. In West Virginia, we have to do that, and we are doing that.
The FAA bill that is before us extends the authorization for these
important programs for 4 more years.
Four West Virginia commercial airports rely solely upon the Essential
Air Service program for any service at all. We are extending that and
enlarging the amount. No community wants to be dependent on essential
air service. It is not a badge of honor. But it is a fact of survival.
But for many, it is their only option to maintain air service.
But as I mentioned earlier, the program has not met the needs of many
communities. In 2003, as part of the last FAA reauthorization bill, I
created a number of new voluntary pilot programs for essential air
service communities. I modeled these initiatives after the Small
Community Air Service Pilot Program by focusing on incentives rather
than punitive approaches.
Under this new plan, a community could receive funds to develop its
own marketing plans rather than rely on the airline for one. It could
use funds to increase service levels, opt to use different types of
aircraft or investigate the use of alternative transportation service.
In other words, it said: What is our problem? What are we going to do
about it? We cannot wait on other people. We have to make these
decisions ourselves. We are doing that in West Virginia.
This year, we have added a number of provisions to strengthen the
Essential Air Service program. We have increased the authorization
level for the program by $58 million to $175 million a year. We have
included provisions to help carriers that provide the essential air
service so they can meet the cost of high fuel. It is essential. We
have increased the flexibility of the program even further so
communities can work with the Department of Transportation and air
carriers to find air service that works for them.
Small and rural communities are the very first to bear the brunt of
bad economic times. It has always been so. It shall always be so. The
Presiding Officer knows exactly what I am talking about. We are always,
in West Virginia, at the end of the food chain on everything. We
understand that. We do not like it, but that is our current
destiny, and so that is why we have to fight harder and try to be more
imaginative.
The general economic downturn and the dire straits of the aviation
industry have placed exceptional burdens on air service to our most
isolated communities. The Federal Government must provide additional
resources for small communities to help themselves attract air service.
If you have to do the work yourself, you do it. You just do it. The
Federal Government must make sure our most vulnerable towns and cities
are linked to the rest of the Nation. It is an easy statement to make,
but it is a huge statement. We have an obligation in this country to
make sure all of our communities and our people are linked to the broad
air service opportunities, hubs and spokes. It has to happen.
My legislation builds on existing programs and strengthens them. We
must continue to provide our constituents the tools and resources
necessary to attract air service, and we are doing that.
So, in closing, I should say a subsidy alone does not solve the
problems of small community air service. If our constituents do not use
that service, or the airlines take it away--airlines cannot operate
unprofitable flights or flights that are marginally profitable, for
which they could do better elsewhere. They make a little bit of money
or they do not make a little bit of money, and they are gone because
their situation is so dire.
I do not know what the future of the U.S. airline industry will look
like in 6 months, but our Nation needs a strong airline industry. Our
communities need to be connected to the aviation system.
That is why we are going through this most extraordinary exercise of
no amendments to be voted on, a good deal of time to sit and talk, a
great deal of frustration. But we are trying to pass something called
the Federal aviation bill that will provide service to our people. If
there is anything in the national interest, it is that. I will not go
so far as to say it is more important than the interstate highway
system, in terms of economic development and also reaching out to the
world, which all our States need now to do on a two-way basis.
So we fight. We continue to fight.
I yield the floor.
The PRESIDING OFFICER (Mrs. McCaskill). The Senator from Georgia.
Mr. ISAKSON. Madam President, while the distinguished Senator from
West Virginia is on the floor, I wish to, first of all, commend him for
his efforts on behalf of aviation in the United States. I associate
myself with his remarks about rural and underserved areas. I associate
myself with all the remarks he made in support of our aviation system.
I am one of those people who are frustrated with our inability to
deal right now with amendments. I understand a substitute was offered
last night and the tree was filled so there are no germane amendments
that were--the amendments that were filed yesterday are no longer
germane; am I correct?
Mr. ROCKEFELLER. Madam President, I say to my good friend, the
Senator from Georgia, things have changed a bit this morning and
decisions are being made on that side of the aisle that will determine
whether we can move forward. I am hopeful about that process.
Mr. ISAKSON. Madam President, in the hopeful event we can move
forward, I wish to, for a minute, with the distinguished Senator, make
him aware of an amendment I submitted yesterday but is not pending. It
cannot be pending right now. I agree with the Senator entirely on the
importance to the American economy of U.S. aviation. In the bill they
put out, there is one element that was not addressed that I think
should be.
On December 31 of this year, the United States providing terrorism
insurance to the airlines sunsets. If it is, there will be no access to
terrorism insurance by U.S. domestic carriers because the only private
insurers that will offer terrorism insurance offer it with an advanced
cancellation provision, which basically means if we went to a code
level orange or a code level red, the insurance company in advance of a
terrorist attack could actually cancel the insurance. So the aviation
industry would be without insurance.
Our competition in Europe does not have that problem. They still have
private insurance available for coverage of aviation terrorism. I
submitted an amendment yesterday that would extend the date of December
31 of this year--which is the expiration date--to make it December 31,
2011, so airlines can continue to pay the U.S. Government for insurance
against terrorism.
If my understandings are correct, those premiums totaled $160 million
in the last year and are a revenue source to the United States of
America, as it should be. We should not be providing it without cost.
So I would hope, when the meetings that are going on are concluded,
and if
[[Page S3660]]
we can get back to the base bill and if amendments again become
relevant, that the distinguished Senator from West Virginia, the
Senator from Alaska, and the others who have worked so hard on this
legislation will look favorably on an extension of terrorism insurance
availability to domestic U.S. carriers.
With that, Madam President, I yield the floor and suggest the absence
of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The bill clerk proceeded to call the roll.
Mr. ROCKEFELLER. Madam President, I ask unanimous consent that the
order for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. ROCKEFELLER. Madam President, I say also to my very dear friend
from Georgia with whom I have a long and wonderful background because
of his strong reaction to our plight in West Virginia with the coal
miners--he doesn't have coal in his State but he came into our State
and adopted it as his own and we adopted him.
I also wish to tell him that what he is suggesting is something I
very much support.
Amendment No. 4642 to Amendment No. 4637
Madam President, I believe there is an amendment at the desk.
The PRESIDING OFFICER. The clerk will report the amendment.
The bill clerk read as follows:
The Senator from West Virginia [Mr. Rockefeller] proposes
an amendment numbered 4642 to amendment No. 4637.
Mr. ROCKEFELLER. Madam 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:
In the amendment, strike ``1'' and insert ``3.''
Mr. WYDEN. Madam President, I ask unanimous consent to speak as in
morning business for up to 15 minutes.
The PRESIDING OFFICER. Without objection, it is so ordered.
Healthy Americans Act
Mr. WYDEN. Madam President, there is now an historic coalition here
in the Senate, a group of 14 Senators. Seven Democrats and 7
Republicans are sponsoring a health bill guaranteeing all Americans
quality, affordable health care coverage. There has never been such a
coalition in the history of the Senate.
Today our group got some historic news. The Government's go-to
officials for budgeting and taxes have thrown decades of conventional
wisdom into the trash can. They have informed our group that all
Americans can have quality, affordable health care coverage without
breaking the bank.
Briefly, here is what the Congressional Budget Office and the Joint
Committee on Taxation have found. They found that our legislation, the
Healthy Americans Act, can be up and running in 2012. They found the
legislation would become budget neutral in 2014. That means our
legislation is self-financing in the first year that universal health
care coverage would be fully implemented in our country. In the years
after 2014, because the legislation holds down health cost increases,
it starts to generate budget surpluses for the Federal Government.
This analysis is fresh, independent evidence that health care can be
fixed without massive tax increases or boatloads of additional
Government spending. It is a chance, in my view, for Congress and our
country to look at the issue of health care reform with fresh eyes,
because what the Congressional Budget Office and the Joint Committee on
Taxation have analyzed doesn't involve a set of lofty principles or
some of the oratory from the campaign trail, but it is actual
legislation.
Because this report is a historic document, I ask unanimous consent
that the letter dated today from the Congressional Budget Office and
the Joint Committee on Taxation be printed in the Record. The report is
available on the CBO Web site www.cbo.gov.
There being no objection, the material was ordered to be printed in
the Record, as follows:
May 1, 2008.
Hon. Ron Wyden,
U.S. Senate,
Washington, DC.
Hon. Robert F. Bennett,
U.S. Senate,
Washington, DC.
Dear Senators: At your request, the staffs of our two
organizations have collaborated on a preliminary analysis of
a modified proposal for comprehensive health insurance based
on S. 334, the ``Healthy Americans Act,'' which you
introduced last year. That modified proposal includes various
clarifications and changes that you have indicated you would
like to examine as part of the consideration of that bill.
Attachment A summarizes our understanding of your modified
proposal.
The staffs of the Congressional Budget Office (CBO) and the
Joint Committee on Taxation (JCT) have worked closely
together for the past several months to analyze your modified
proposal; this collaboration reflects both the novelty of the
undertaking and the intimate connection between the revenue
and expenditure components of this proposal. We have
summarized our conclusions in this joint letter; its purpose
is to give you preliminary guidance regarding an approximate
range of revenue and cost results that might be expected from
your modified proposal. This joint letter does not constitute
and should not be interpreted as a formal estimate of your
proposal's budgetary impact, which--for the purposes of
scoring under the Congressional Budget Act--would ultimately
be provided by CBO and would incorporate revenue estimates
prepared by the JCT staff.
The basic thrust of your modified proposal is to require
individuals to purchase private health insurance and to
establish state-run purchasing pools and a system of Federal
premium collections and subsidies to facilitate those
purchases. The system's premium collection and subsidy
mechanisms would be based largely on income tax filings, and
the required benefits would initially be based on the Blue
Cross/Blue Shield standard plan offered to Federal workers in
2011 and then allowed to grow at the rate of growth of the
economy. Although employers would have the option of
continuing to offer coverage to their workers, nearly
all individuals who were not enrolled in Medicare would
obtain their basic health insurance coverage through this
new system. Most enrollees in Medicaid and all enrollees
in the State Children's Health Insurance Program (SCHIP)
would have their primary insurance coverage shifted to the
new system.
Your proposal also would replace the current tax exclusion
for employer-based health insurance premiums with a fixed
income tax deduction for health insurance. (In addition,
employers that had provided health insurance would be
expected to ``cash out'' their workers--that is, to increase
workers' wages by the average contribution that the employers
would have made for their health plan.) The proposal also
would require new tax payments from employers to the Federal
government and further would seek to recapture the savings to
state governments from reduced expenditures on Medicaid and
SCHIP.
There are several important distinctions between the
proposal we analyzed and S. 334 as it was introduced. For
example, our analysis was limited to the operation of the new
health insurance purchasing system and did not take into
account most of S. 334's provisions regarding the Medicare
program or other provisions that would not directly affect
the new system. More fundamentally, the modified proposal
would tie the premiums collected through the tax system--as
well as the premium subsidies for lower-income households--to
the cost of the least expensive health plan available in an
area that provided required benefits, not to the average
premium amount, as under S. 334. Furthermore, the value of
the new tax deduction would not vary with the premium of the
insurance policy that was actually purchased, and the
schedule of employers' payment rates would range from 3
percent to 26 percent (rather than 2 percent to 25 percent)
of the average premium. Attachment B describes in more detail
the main differences between your modified proposal and S.
334.
The preliminary analysis reflected in this letter is
subject to three important limitations. First, the staffs of
both JCT and CBO are in the process of enhancing our
capabilities to estimate the effects of comprehensive health
care proposals. Improvements in our methodologies or more
careful analysis of your modified proposal's provisions--
particularly as you translate those concepts into formal
legislative language--could change our assessment of its
consequences.
Second, any formal budget estimate will reflect the
macroeconomic assumptions and the baseline projections of
current-law tax and spending policies in effect at the time
it is issued. That baseline could differ materially from
today's baseline.
Third, we focused our analysis on a single future year in
which the proposed system would be fully implemented. For
that purpose, we settled on 2014, the sixth year of the
current 2009-2018 budget window. Under an assumption that the
proposal is enacted in 2008, that timeline for full
implementation seems to us to be achievable but could be
optimistic, as we expect that it would probably take until
2012 for the new system to begin operation, and several
years after that for various phase-ins and behavioral
adjustments to take place. The new system would involve
temporary net budgetary costs in its initial years; we
have not analyzed the magnitude of those early-year
transition costs.
Overall, our preliminary analysis indicates that the
proposal would be roughly budget-
[[Page S3661]]
neutral in 2014. That is, our analysis suggests that your
proposal would be essentially self-financing in the first
year that it was fully implemented. That net result reflects
large gross changes in Federal revenues and outlays that
would roughly offset each other.
More specifically, under your proposal, most health
insurance premiums that are now paid privately would flow
through the Federal budget. As a result, total Federal
outlays for health insurance premiums in 2014 would be on the
order of $1.3 trillion to $1.4 trillion. Those costs would be
approximately offset by revenues and savings from several
sources: premium payments collected from individuals through
their tax returns; revenue raised by replacing the current
tax exclusion for health insurance with an income tax
deduction; new tax payments by employers to the Federal
government; Federal savings on Medicaid and SCHIP; and state
maintenance-of-effort payments of their savings from Medicaid
and SCHIP. Attachment C provides more information about the
approximate magnitudes of those components.
For the years after 2014, we anticipate that the fiscal
impact would improve gradually, so that the proposal would
tend to become more than self-financing and thereby would
reduce future budget deficits or increase future surpluses.
That improvement would reflect two features of the proposal.
First, the amount of the new health insurance deduction would
grow at the rate of general price inflation and thus would
increase more slowly than the value of the current tax
exclusion.
Second, the minimum value of covered benefits that all
participating health plans had to provide would initially be
set at the level of the Blue Cross/Blue Shield standard
option offered to Federal workers in 2011 (we assume that the
system's inaugural year would be 2012); but under your
proposal that average value would from that point forward be
indexed to growth in gross domestic product per capita rather
than growth in health care costs. Because Federal premium
subsidies would be based on the cost of providing that level
of coverage, the cost of those subsidies would grow more
slowly over time.
We hope this analysis is useful to you. Not surprisingly, a
number of uncertainties arise in attempting to predict the
effects of such large-scale changes to the current health
insurance system. Although we have provided a range of
results that reflect our current expectations about likely
outcomes, actual experience--and the results of a formal cost
estimate--could differ substantially in either direction. If
you have any questions about this analysis, please do not
hesitate to contact us; the staff contacts are Pam Moomau and
Nikole Flax for JCT and Philip Ellis for CBO.
Sincerely,
Peter R. Orszag,
Director, Congressional Budget Office.
Edward D. Kleinbard,
Chief of Staff, Joint Committee on Taxation.
Mr. WYDEN. Madam President, I wish to touch on a few points with
respect to this report. Obviously, the key to fixing health care is to
contain costs. Our bipartisan legislation does that by making sure all
Americans have more clout in the marketplace. We achieve that by making
sure that everyone goes into a big pool, because if they are off by
themselves, they don't have a lot of ability to get the best deal for
their health care dollar. But if they belong to a bigger group, they
have a lot better chance of containing costs. We cut the administrative
costs of health care. We use a State and regional pooling approach that
has been found to cut administrative costs. We get patients out of
unnecessary hospital emergency room visits because more would get seen
on an outpatient basis. We make progressive changes in tax law and we
empower consumers, because for the first time, if they have employer-
based health coverage, they could actually find out what is being spent
on their health care. Right now, basically all they know is they are
not seeing their wages go up because health care costs are eating up
all of the employers' resources. We think making sure that the worker
knows what is being spent on health care provides them a new set of
opportunities to get more for their health care dollar.
My view is that today's health care system is largely driven by
employers and insurance companies. Clearly, there is a significant role
to play for them. But what we do in our legislation is provide a bigger
role for individuals and especially their health care providers--the
thousands of doctors and nurses and physician assistants. We make sure
that everybody under our legislation could have a health care home. So
instead of being lost in an incredibly complicated health care system,
there would be one person who would coordinate each individual's care.
A big part of what we are doing in this bill is to modernize the
employer-employee relationship in the health care field. What we are
doing in 2008 in health care as it relates to employers and employees
isn't much different than what was done in 1948. The Chair can remember
all of the efforts of President Truman to make changes in American
health care. So we modernize that relationship. We continue to let
employers who choose to offer coverage, but we give the workers more
choices with respect to their health care and we give the employers
much needed cost relief, which is especially essential at a time when
they are competing in tough global markets.
I want to mention all of my colleagues who are sponsoring this
legislation with me. Senator Bennett of Utah, a member of the
Republican leadership, is the principal cosponsor. Senator Bennett's
knowledge of economics, in my view, has few equals and I could not have
a better partner for this whole effort. We have seven Democrats and
seven Republicans who are on the effort. I am particularly pleased that
so many from the Senate Finance Committee, where Senator Baucus and
Senator Grassley have worked in a bipartisan tradition for years, are
part of our effort. From the Senate Finance Committee we have Senator
Grassley and Senator Crapo and Senator Stabenow cosponsoring the
legislation, all of them making a great contribution in this area.
As we go forward in the days ahead, Senator Stabenow's expertise and
interest, particularly in health information technology, is going to be
instrumental. For example, Dr. Orszag, the director of the
Congressional Budget Office, who brings great professionalism to this
effort to look at health care, this morning when he briefed eight of us
in the Senate on the legislation, mentioned the fact that the evidence
suggests as much as 30 percent of the health care dollar is spent in a
fashion that produces very little value. So what Senator Stabenow is
trying to do with health information technology, electronic medical
records, and other innovative approaches is to wring more value out of
every health care dollar. Her contribution is so very important.
Senator Grassley and I have worked together on many health care
issues. Of course, the partnership we have on the Finance Committee
between Chairman Baucus and Senator Grassley is a very rare and a very
beneficial alliance here in the Senate, and I so appreciate Senator
Grassley's involvement.
Senator Crapo is my partner in the West who has a great interest and
long-standing involvement in rural health care, and we are very pleased
that he is an additional voice on the Senate Finance Committee for the
legislation.
I would also like to credit the other Senators who are involved. We
are very pleased that Senator Landrieu, who is helping to reinvent
health care in her State as a result of destruction caused by Hurricane
Katrina and all of the challenges they face, has been particularly
interested in and creative in thinking about opening up new
opportunities for entrepreneurship in her State and elsewhere. Senator
Landrieu correctly points out that if you modernize the employer-
employee relationship in health care, that is going to mean we are
going to have more entrepreneurs. It is going to be good for business.
It is going to be good for our economy. We are going to be able to grow
our economic base in the country. Senator Landrieu argues very
eloquently, in my view, that if you provide some cost relief for the
employers who got into the business of driving health care by accident
in the 1940s, you are going to be able to create jobs and strengthen
our economy.
Senator Nelson, a former insurance commissioner, is one of our
cosponsors. He has great expertise in insurance regulation. In fact, he
pointed out this morning some of the tools that are going to be
necessary to prevent price gouging in health insurance and is making a
great contribution there.
Senator Lieberman has a long-standing interest in this and is a
cosponsor. Of course, his involvement is particularly critical because
his State is a center of health insurance and technology and there are
a variety of major economic concerns involved.
[[Page S3662]]
We are very glad to have Senator Gregg, who is the ranking member on
the Budget Committee and a driving force on keeping down health costs
to make health care more affordable and available to all. We're also
pleased to have the support of Senator Inouye, who as chairman of the
Defense Appropriations Subcommittee, has shown his leadership in health
care research for our soldiers and sailors with benefits for all
Americans. We also appreciate the support of Senator Corker, who has
been a leading advocate for reforming the tax code to make health
insurance more available and affordable. And we're grateful for support
from Senator Coleman, who has the world renowned Mayo Clinic in his
state and himself has been a leader in the area of health technology.
And we are especially pleased to have the support of two former
governors, Senator Carper and Senator Alexander. The Healthy Americans
Act gives a major role to the states in reforming our health system and
it's critical to have the support of Senators with the knowledge of
state government and executive leadership experience they have
supporting our legislation. It is a group unlike any other we have seen
in the history of the Senate. Fourteen Senators--seven Democrats, seven
Republicans--actually cosponsoring together a piece of legislation that
will guarantee all Americans affordable, good quality coverage.
This legislation ensures that all of our people have choices such as
we have here in the Congress. We have choices among a number of very
good private sector packages. It ensures that coverage for the first
time will be portable. You can take your coverage from job to job to
job, which is something that millions of Americans desperately want.
It is our future. The fact is that today, by the time you are 35
years old, you are likely to change your job 7 times. Yet the system
almost locks you into your present position. You cannot move. You
cannot go to another opportunity. I think to have a portable health
system where you can take your coverage from job to job to job and not
worry about losing your coverage if you want to take a promotion or
start your own business is particularly important.
The best part about it is that the Joint Committee on Taxation and
the Congressional Budget Office have said this can be done in a
revenue-neutral way.
We have had a number of Senators involved who have longstanding
credentials in terms of being tougher on budgets and concerned about
fiscal discipline. Now, the Joint Committee on Taxation and the
Congressional Budget Office have said that, contrary to popular wisdom
that universal coverage is going to break the bank and require tax
hikes and new spending, it can be done in a budget-neutral kind of
fashion.
Finally, I want to add since I think I really didn't do him justice
earlier--Senator Inouye has been a wonderful addition to our group. He
and his staff have had a great interest in looking at a number of
health reform issues, particularly ones that make better use of our
workforce, focused on prevention and quality. We are thrilled to have
him as well.
Madam President, I note that one of our colleagues has come to the
floor. I will wrap up simply by saying that I think the entire Senate
should be very grateful for the outstanding work done by the Joint
Committee on Taxation and the Congressional Budget Office, led by Peter
Orszag and Edward Kleinbard. Those two organizations have never
issued--in the history of their organizations--an analysis like the one
they made available today. Never in the history of the organizations
has there been such an analysis.
I submit that if there had been an analysis like this done the last
time the Congress debated universal coverage back in 1993 and 1994, if
there had been a report like this one from the Congressional Budget
Office and the Joint Committee on Taxation, they could have moved
forward on a bipartisan basis to actually pass legislation, see it
signed into law, and end the disgrace that a country such as ours,
which is good and strong and talented, hasn't been able to fix American
health care.
This time, I think we are up to it. Senator Bennett and I have kept
apprised the leadership in the Senate on both sides of the aisle. It is
our determination to work with colleagues of both political parties. We
intend to work with the Presidential candidates. I have talked with
Senators Clinton and Obama many times about the Healthy Americans Act.
I talked to Senator Graham last night about the Congressional Budget
Office briefing. We know of his involvement with Senator McCain. If you
are going to deal with a big, important issue, it has to be bipartisan.
Today, the Congressional Budget Office and the Joint Committee on
Taxation have made a significant contribution to our effort to move
forward and actually enact universal health coverage that works for all
Americans. We are indebted to their organizations.
I am particularly grateful to colleagues who have joined as
cosponsors in this effort. Senator Bennett and I will continue to work
with colleagues like Senator Baucus, Senator Kennedy and others over
the next 6 or 7 months so that this can be ready to go for the next
President of the United States.
I yield the floor.
The PRESIDING OFFICER. The Senator from Idaho is recognized.
Mr. CRAIG. Madam President, what is the current state of the floor?
The PRESIDING OFFICER. The Senate is considering H.R. 2881.
Mr. CRAIG. Madam President, I ask unanimous consent that I be allowed
to speak as in morning business.
The PRESIDING OFFICER. Without objection, it is so ordered.
(The remarks of Mr. Craig pertaining to the introduction of S. 2953
are located in today's Record under ``Statements on Introduced Bills
and Joint Resolutions.'')
The PRESIDING OFFICER. The Senator from Florida.
Mr. NELSON of Florida. Madam President, the statement by the Senator
from Idaho with regard to the need for drilling has been articulated by
a very respected columnist, Robert J. Samuelson, who recently wrote his
column, published in the Washington Post, that in essence said we ought
to put oil rigs off the protected shores of Florida and in the
preserved wilds of Alaska.
Once again, we are going to hear statements such as that of the
Senator from Idaho and read statements in the written press by Mr.
Samuelson as gas prices are hitting record highs. We are going to see
the renewed push by the Bush administration and by the oil industry to
drill in areas that are protected, such as the Gulf of Mexico off
Florida, as articulated by the Senator from Idaho, as well as the area
known as ANWR, which is in the preserved wilderness of Alaska. Drilling
right away in environmentally protected areas was the centerpiece of
Mr. Samuelson's solution to the rising gas prices.
There is not one of us in this Chamber who does not want to do
something about those gas prices. What Mr. Samuelson said in his column
was that to oppose drilling in those protected areas--as indicated also
by the Senator who has just spoken--to oppose drilling in those
protected areas, he said, is sheer stupidity. And he said further it is
a ``prejudice against oil companies.''
That is the same thing the oil companies say every time there is a
spike in prices. They have their long-term remedy that would expose
these wilderness areas, and Florida's beach and tourism-driven economy,
our areas of an environmentally sensitive nature, as well as the
military interests I asked the Senator from Idaho to acknowledge, and
they would put all that at risk. It is these same oil companies that
are now, because of the high price of gasoline, going to make another
end run--very possibly next week--and try to bust the ban, the
longstanding ban on coastal drilling. Of course, they are going to cite
what they do every time the oil prices spike high. They are going to
cite the high gasoline prices.
I am basing my predictions of what is going to happen in the next
couple of weeks, I am basing this assertion on the oil industry's track
record and on the comments made Tuesday by the President, renewing his
call for drilling. I am basing it on the suggestions we see in this
newspaper column.
In advance of this likely new assault, this Senator wants to make
clear oil that is still deep in the ground has no direct link--none--to
today's pump
[[Page S3663]]
prices. Any oil in the ground will not be in the marketplace for
another 10 years. More important, no matter what anybody says or what
anybody writes, the United States only has 3 percent of the world's oil
reserves while the United States consumes 25 percent of the world's oil
production. In other words, it is, to use Samuelson's term, ``sheer
stupidity'' to think the United States can somehow drill its way out of
the energy crisis.
We are a nation that is hooked on oil. Drilling along the Florida
shore or in wildlife preserves will not break the habit. By the way,
one of the main reasons oil prices have gone up so sharply in recent
years is the volatility of major producer nations, such as Iraq and
Iran--not even to mention Venezuela and Nigeria. History reflects
similar spikes, circa 1973, when we had an OPEC oil embargo related to
a war in the Middle East; then again in 1979 with the Iranian
revolution; again in 1990 with Iraq's invasion of Kuwait and the first
gulf war; and again, since 2003, with the war in Iraq, concomitant with
increasing Asian demand.
The common denominator in all these spikes is they are fueled by the
subsequent increase in oil speculation. The common denominator is
trouble in the Middle East and especially in Iraq and Iran. More
drilling along protected U.S. coasts, in bays and harbors and in the
pristine wilderness of Alaska, will not stabilize Iraq and it will not
guarantee Saudi Arabia's long-term friendship. Nor will it end the
unregulated speculation that has driven the price of oil to more than
$118 a barrel when the price should have been no more than $55 a
barrel, based on present supply and demand, according to an industry
leader's testimony before Congress. That means the law of supply and
demand has been broken and we are paying at least $63 per barrel over
and above what supply and demand would produce--a price of $55. We are
paying that extra $63 per barrel to enrich investment bankers,
speculators, and oil companies.
As Mr. Samuelson says in his column: ``What to do?''
The U.S. failed in the 1970s to enact a real energy program to get us
off oil. The result is it is Brazil that runs on ethanol today--not the
United States. Germany leads the world in solar power, not the United
States. In the meantime, oil companies are awash in record profits,
more than $155 billion in profits alone last year, at the same time not
spending enough on refineries or alternative energy, while guess who is
getting it in the neck: the consumers at the pump.
Then, even worse, it took the United States more than 30 years to
raise mileage standards on cars and trucks to a paltry 35 miles per
gallon, something that will not even be in effect until the year 2020.
And is it not interesting that most of Europe and the cars U.S.-based
manufacturers sell there already average 43 miles per gallon, and in
Japan the cars are approaching 50-miles-a-gallon.
In other words, we are wasting, flat out wasting billions and
billions of gallons of oil. So, again, what are we to do? Well, about
half of the oil we consume goes into transportation, and it should not
take a rocket scientist to realize that is where we ought to focus. So,
first, if we start to enact serious conservation measures, and things
such as a 40-miles-per-gallon mandate for the fleet average of our
personal vehicles, and if we provided greater tax breaks for hybrid
cars, and ultimately hydrogen-powered and electric-powered cars, then
we are going to start making a difference.
Second, the Government, our Government, led by our next President, is
going to have to enact and subsidize a national energy program to
transform us from our energy dependence on oil, especially foreign oil,
to alternative and synthetic fuels to power much of the transportation
sector.
Members of the Senate, it has been done before. Remember in the
1960s, President Kennedy led us to conquer the bounds of Earth, to go
to the Moon and return, and all of that occurred within a decade. So we
have got to act with the same urgency. And while we are at it, we are
going to have to make ethanol, ethanol that we will make from things we
do not eat so we do not reduce our food supply.
While we are at that, we are also going to have to pay attention to
how we power not only our cars and our trucks, but our homes and our
industry. We are going to need to develop solar, wind, thermal energy,
and hydroelectric. And who knows the advances of technology in
harnessing renewable energy sources. We are going to have to look for
electricity that is from safer nuclear power.
Now, this is what our Presidential candidates ought to be hearing and
ultimately before this election they ought to be making a pledge to the
American people that they are going to do this. In the 10 years going
forward that it would take to bring in new oil rigs fully to market, in
that 10 years, if we are good stewards of what we have, we will have
conserved more oil than we ever get out of the ground, and we will be
mostly free from foreign oil by enacting this energy plan.
Our future will not be realized by looking backward to the short-term
polluting and dirty energy solutions of the last century, solutions
they still offer for the future, solutions by people who do not want to
change their ways, such as oil companies.
So should we start drilling right now in very environmentally
sensitive areas? To use Mr. Samuelson's words in his column, ``That is
sheer stupidity.''
I yield the floor, and I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. SCHUMER. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER (Mr. Salazar). Without objection, it is so
ordered.
Mr. SCHUMER. Mr. President, I rise to speak about the provision
related to the New York liberty zone that appears in the FAA
reauthorization bill. A few of my friends on the other side of the
aisle have called this provision an earmark. They have called it a fund
to create a train to Kennedy Airport, even though that is not even
mentioned in the legislation.
I wish to fill in on the facts. First, after the devastating attacks
of 9/11 which scarred my city and our country, Congress and the
President generously agreed to provide $20 billion in assistance toward
the rebuilding of lower Manhattan. It was a promise the President made
to me and Senator Clinton the day after the attacks. It is a promise
that, to his everlasting credit, the President has kept and has never
wavered from. The President understood, I think all of my colleagues
understand, what happened in New York. But we still live with the
scars. That downtown has not recovered. There are fewer square feet of
office space today than there were then in downtown. And the families
who lost loved ones still grieve every day, as does just about every
New Yorker.
There has always been talk about wearing flags. I put this flag on my
lapel on 9/12/2001. I have worn it every day since and, God willing, I
will wear it every day for the remainder of my life in remembrance of
what has happened.
Now, of the $20 billion, the money was divided for various purposes.
Some, of course, was to help the families who have lost loved ones.
Some was for the cleaning up of the World Trade Center site. It was a
massive undertaking--to visit the rubble a day later, to smell death
and the burnt flesh in the air, and then to realize that people, not
only from New York but from around the whole country came to help us
help heal those wounds.
Some of the money was put aside specifically so that downtown would
recover; incentives to bring business back and money for
transportation, because the entire subway nexus had been destroyed. At
that point in time, people worried that people would desert downtown
and never come back.
New Yorkers, through efforts and valiance, have struggled, and so
that is how the $20 billion came about. Was any part of the $20 billion
an earmark? Is there any reason to equate it with a bridge to nowhere?
Please. Please, my colleagues, I do appreciate that my friend from New
Hampshire--I do consider him my friend--has retracted that specific
statement. But to call the $20 billion, or a significant part of it, an
earmark is unfair labeling, to be kind. Or the tax preferences for the
gulf opportunity zone after Katrina,
[[Page S3664]]
were they earmarks? They were a benefit, a large benefit, designated
for a specific region. When we help a disaster area, is that an
earmark? No. And all the hallmarks of earmarks done for only one
member, slipped in in secrecy, none of that applies here.
In fact, this exact proposal is in the President's budget this year
in the light of day for all to study because the President himself, as
I said, has kept his word. Has it been done secretly? Obviously, no.
This provision has been around for a while.
As I will show in a few minutes, many of my colleagues who oppose it
now have voted for it in other legislation. Why has New York had to
wait so long for this provision? It is because it has passed the House
a couple of times, it has passed the Senate once, but the bills that
passed never hooked up and never made it to the President's desk.
Are we going to tell those who argue that this is an earmark that any
aid to any region, no matter how publicly talked about, no matter how
desperate the need, is an earmark? With all due respect to my
colleagues, it is not fair. It is not right. It is not up to the level
of this body or this discourse. It is using a word that has a bad
connotation and inappropriately labeling something that has been part
of America's nobleness since 9/11.
Let me give you a little bit of history here. After the $20 billion
in aid was passed, some of the provisions were not fully realized,
others were, and exceeded the amounts of money. So the New York
delegation had talked with the President and with OMB leaders about how
to make sure those dollars were most wisely spent, and in some places,
the amounts of money changed.
A consensus emerged as we went through this that the best way to
support private enterprise, or one of the best ways to support private
enterprise and rebuild lower Manhattan, was to improve transportation
in and around the liberty zone.
As a result, the city and State proposed supporting improvements in
transportation infrastructure in or connected with the liberty zone. If
you look at the Treasury blue book, my colleagues, it is on pages 47 to
49. This is not something that was slipped in by any Member of the
Senate, not by me or anyone else. It was the President who proposed it
in this budget, as he has proposed it in previous budgets.
It is not something that was slipped into the bill in the middle of
the night. And to equate it with wasteful porkbarrel projects is an in
insult to the families of those who survive, to every New Yorker, and I
believe to every American.
When New York was struck, we all rallied together. We have sort of
kept that tone since, when it comes to helping areas that need help. So
this is not about funding porkbarrel projects. This is about keeping
our promises and our faith.
Second, my colleague insists that this is a train to Kennedy Airport.
I refer him to the language in the FAA bill. There is no reference to a
train to Kennedy Airport. There is no reference to an air rail. As I
said, it sounded good, but I appreciate the fact that the Senator from
New Hampshire has pulled back from calling it a train to nowhere. I
personally called him 2 days ago and read the language of the bill to
him. It does not mention a rail project. There has been talk in
Manhattan, among the mayor and Governor and the city leaders who would
be in charge of spending this money, that that is a possibility. But
there are many other possibilities as well.
The one thing the legislation states is about improving and
rebuilding transportation in the liberty zone. That is all. There is no
specific project mentioned in the language. There is no particular
project or projects I am supporting. To say otherwise is untrue. It
would be totally within the law to use this for some subway
improvements or other types of spending. That will be what the city
will decide, in consultation with the Governor and the appropriate
legislative bodies.
As for the mechanism of funding which allows the city and State to
keep part of the Federal income taxes withheld from city and State
workers, we have tried various ways of designing this aid, and this is
what the administration came up with, with our agreement and consent.
If any of my colleagues would like to suggest another way for
fulfilling the promise they would support, I am happy to listen. But I
remind them that this is a solution supported by the administration. In
fact, the Bush administration has supported the $2 billion trade-in for
the liberty zone in four consecutive budget proposals. The details of
how to do it, again, of how to spend the money, will be left up to the
city and State. This is not new money, I remind my colleagues. It is
the last part of a solemn promise made by President Bush and supported
by this Congress in 2001.
The current version of the language passed the full House in the most
recent energy bill. It was part of a Senate energy bill that received
59 votes last year and 58 votes earlier this year. It was also part of
the FAA reform package that passed out of committee by broad bipartisan
vote. This is not something that was snuck into the bill as it reached
the floor of the House. It was passed and debated in the Finance
Committee. In fact, two of my colleagues who have raised questions
about this--my friends from New Hampshire and South Carolina have both
voted for legislation in favor of enacting the liberty zone provision,
when it has been previously considered as part of other legislation.
So now to object to this, to the whole FAA bill because it has this
provision in it, is a change of view. There was no objection to other
legislation that had it on that basis.
The junior Senator from South Carolina voted yes on final passage of
two bills in the 109th Congress--S. 2020, and H.R. 4297--that both
contained the liberty zone provision. Unfortunately, the provision was
not in the final versions of these bills, and the remaining funds for
Ground Zero were not allocated. By advocating against this current
position, it is clearly a change. There was no specific vote on this
rail link, but there were votes on larger packages that contained it,
just as this FAA package is a larger package that contains it. The
senior Senator from New Hampshire has voted in favor of the liberty
zone tax provisions at least three times: First, in favor of the
original bill, H.R. 3090; again, in favor of two separate bills--S.
2020 and H.R. 4297--to complete the funding in the 109th Congress.
So it is hard to understand, since this is not an earmark. This is
not a specific project. This is supported by the President. It fulfills
a promise that, frankly, this Nation made to New York, the last part of
it. It is hard to understand why the views have changed. We have been
working 4 years to finally complete this promise. Each time objections
are raised. If someone doesn't like it on this bill, then make a
commitment on what bill we can finally get it done because I am going
to try to get this on any piece of legislation that moves in the Senate
until the promise to the people of my city and, frankly, the people of
America is finally fulfilled.
I say this to the 98 other Senators not from New York: If 9/11 had
happened in your State, you would be down here on the floor of the
Senate making the same fight we are making. You would not allow
anything to get in the way of a promise that had been made to a city or
State, particularly when the arguments made don't really apply--not an
earmark, not a train to nowhere, and not something that was done in the
dark of night.
I want to note again that the Bush administration has been
supportive. I have many disagreements with the White House on a host of
issues, but they have been helpful and true to their word on this
issue. President Bush himself has. I have thanked him for it
repeatedly. The President believes it is important to keep his promise.
This body should feel the same way. That is why he put his proposal in
four consecutive budgets. That is why when the administration issued
its statement of administrative policy on this bill, they did not note
any objection to this provision.
I know there can be objections. That is part of what we do around
here. But I haven't seen a good argument against this other than you
don't believe New York City should get the money that was promised to
it. This is about keeping a promise. I am going to make sure, to the
best of my ability in this body, that this promise is kept. My
constituents demand it. Fairness demands it. If this were about your
State, you would demand it too.
[[Page S3665]]
I yield the floor.
The PRESIDING OFFICER. The Senator from Missouri.
Mrs. McCASKILL. Mr. President, I rise to talk about an amendment that
I hope to offer on the reauthorization of the Federal Aviation
Administration. It is an important amendment, and I want to discuss it
so that my colleagues understand what this amendment is about.
This is a picture of an airplane that was provided to my office by a
U.S. safety inspector. A pilot for a Chinese carrier requested
permission and landed in Frankfurt, Germany, for an unscheduled
refueling stop. They were running low on fuel. This is what the U.S.
safety inspector provided us. This is what German workers found--
seatbelts wrapped around fan blades.
There is a seatbelt. There is a seatbelt, as you can see, and the
structure behind. They did this to minimize turbulence because there
had been an engine that had failed. The inspection found that a total
of three engines had to be replaced before the plane was going to be
allowed to take off again.
What does this have to do with the amendment? In the latest audit,
the Department of Transportation inspector general found that 67
percent of the heavy maintenance--not talking about kicking the tires
or changing the oil--of U.S. commercial aircraft is now being performed
by foreign repair stations. In a series of reports, the inspector
general has identified many gaps in FAA oversight for these foreign
repair stations.
What this amendment does is seek to apply the same standards of
safety and security to all of these foreign repair stations that U.S.
carriers are using. That is a pretty reasonable proposition. If you
have a commercial carrier that is serviced in the United States at an
FAA certified facility, it is likely an FAA inspector is onsite, a
constant presence. There are requirements of drug and alcohol checks.
There is perimeter security. There are standards that must be met in
terms of these repair stations. How does it make sense that we don't
demand those same standards for American carriers that are using
foreign repair stations? Most Americans would be surprised to find out
that we don't. That is what this amendment is going to fix.
I thank Senator Specter for cosponsoring this amendment. I want to
spend a little bit of time talking about what the amendment contains,
but I want to make sure that not only is the problem just whether the
work being done is not up to the standards we would expect in some of
these foreign repair stations, I want to talk about security issues.
My mom is going to be 80 this summer. She has had two knee
replacements. She can't go through an airport without being wanded,
many times her suitcase being opened. We all know that we have to check
our shampoo. We have to not carry water bottles through security
anymore. I think the American flying public understands and has
accepted these incredibly intrusive measures because they want safety.
They want security. They want to make sure that when they fly, they are
safe. So they have said: OK, I am going to take a bunch of time at the
airport. I will stand in lines. I will have a wand. I will have people
patting my body. I am going to do all this because I want safety and
security.
In 2003, an inspector general report found that there was an al-Qaida
member working at a foreign repair station in Singapore. The report
discovered easy access to facilities by outsiders and found the FAA was
leaving employee background checks and drug and alcohol testing up to
individual airlines.
We note that in December 2001 a senior aircraft technician
at a foreign repair station was found to be a member of the
terrorist organization Al Qaeda. . . .The aircraft technician
photographed U.S. aircraft as potential targets for a
terrorist attack.
Really, is it fair that we all are worrying about whether we have 1
ounce too much of shampoo when we have not taken the basic steps to
make sure al-Qaida is not under the hood? I think most Americans would
be shocked to see this inconsistency in our sense of urgency and
caution when it comes to the safety of the flying public.
What does this amendment do? It is pretty simple. First, it requires
identification and oversight of foreign repair facilities that are
noncertified. The FAA must submit a plan to Congress within 6 months of
enactment to identify and expand its oversight of all noncertified
facilities used by U.S. air carriers. Keep in mind, these U.S. air
carriers are not just outsourcing the labor to foreign repair stations
that are FAA certified in foreign nations. They are also outsourcing
the work to noncertified FAA facilities.
I keep asking the FAA in hearings: Why do we have certification? I
will say: Do you think certification is important?
The FAA officials will say: Yes, we think it is important.
I say: Then why do we have it, if we don't require everybody to have
it? What is the point? Why are we letting carriers use noncertified
facilities if the certification is important to our safety and
security? It doesn't make sense.
This amendment would, in fact, require that those carriers use
certified facilities if they are, in fact, going to use foreign repair
stations. It will require the FAA to do two inspections a year. I do
not think that is a heavy lift: two inspections a year of their
facilities, wherever they may be.
It will require drug and alcohol testing of employees performing
maintenance at foreign repair stations. It has been interesting to me
because we have had some push-backs from some places about this because
of some countries that want us not to require this because they
currently have work of U.S. carriers and they do not want America to
require FAA oversight to this degree. One of the things they protest
most--some of these nations--is the drug and alcohol testing. Well,
with all due respect, I really do not think Americans are excited about
the idea that we would waive drug and alcohol testing for people who
are working on airplanes. I think that is a basic. It certainly would
be a basic in this country. I think it is certainly something the
American people would expect.
It will also enforce the TSA requirements that foreign repair
stations comply with security standards issued by the Transportation
Security Administration.
It will update foreign repair station fee schedules to ensure
taxpayers are not subsidizing the outsourcing of this work.
Here is the part that gets me a little bit cranky about this whole
situation. It is one thing for companies to want to outsource labor to
other countries because it is cheaper. Now, other than the need to fix
our Tax Code, we do not encourage the outsourcing of jobs. It is not as
if we can require corporations in our country to keep all their jobs in
the United States. That is a tough thing for us to do in an open
democracy, in a free market economy. I will tell you what we can do,
though. We can sure make absolutely certain these companies are not
doing it with the help of taxpayer dollars.
Right now, as to the certified repair facilities that are in foreign
countries, the U.S. taxpayers are underwriting the bill for those
inspections and that certification. In other words, the companies can
outsource the labor to a country where it is less expensive, and
taxpayers are footing part of the bill for the safety and security of
those facilities.
Now, if you are going to go for a less expensive labor cost, it seems
to me that you, at a minimum, ought to add to that savings the cost of
the inspections by the U.S. Government. Why should the taxpayers foot
the bill for FAA inspectors to fly over to Singapore to inspect a
facility? That does not seem fair. So this makes sure the people who
are using the foreign repair stations are absorbing the costs of
inspecting and keeping those foreign repair stations up to our
standards. Obviously, it requires the regular inspector general
oversight of the implementation of this provision.
This is very reasonable. The House has similar language in its bill.
I think this makes sense. I think it is something, frankly, the
American public would be surprised to understand, that we have this
huge gap in our safety and security oversight for the flying public.
I look forward to an opportunity for the Members to have a vote on
this amendment. I think we all want trade. We all want to make sure we
can export American products. We do not want trade agreements that put
us at a
[[Page S3666]]
disadvantage or, frankly, we want to make sure we still have access to
other markets. But we cannot outsource safety. We just cannot. This
administration is willing to do that. This administration is willing to
say: We are going to let these other countries worry about whether
their facilities are safe. I do not think this is one area where the
American people want this function of our Government outsourced. I
think they want us to be on top of it. I think they want to make sure
it is being done right. I think they want to make sure it is being done
fairly. I think they want to make sure they are not paying the bill to
outsource this work.
At the end of the day, I think they have been cheerful, as Americans
always are about what is asked of them, but I do not blame them for
being a little worried that there has not been more sense of urgency
about the safety and security of this situation in light of all of the
money we have spent in the name of national security and, importantly,
homeland security.
Mr. President, 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. ROCKEFELLER. 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. ROCKEFELLER. Mr. President, I would like to take a few moments
today to discuss what is a catastrophe all across our Nation--and it
certainly is in West Virginia--because of the price of gasoline and
other transportation fuels.
My State is not wealthy. I think it is either the third or fourth
poorest State in our country, and I do not say that with shame, I say
that with pride because it was, in a sense, one of the reasons I was a
VISTA volunteer. I went there as a VISTA volunteer because I saw a
place where I could at least try to help. The people are the best ever.
When people have to struggle to make it, day-in and day-out, they are
pretty solid people.
As I am sure it is the case for all of my colleagues, for the past
few weeks and months I have been hearing from my constituents
constantly about rising gasoline prices and the resulting rise in the
prices for goods and services throughout our economy.
West Virginians are hurting. West Virginians will always find a way
to persevere--always--but right now many are struggling to juggle
expenses, making enormous sacrifices to feed and clothe their families,
while trying to pay the cost of going to work. We have plants in West
Virginia which people drive hours and hours every day to get to. Work
is not easily found, so where it is, people have to drive. We are 96
percent mountains, 4 percent flat. We have a lot of roads. People
pretty much have canceled the occasional splurge for a movie. We have a
baseball team in West Virginia. That has pretty much been pushed off.
In other words, if it is a nonemergency purchase, they bypass it. It
takes away from their happiness, their stability as a family, but they
have no choice. Belts have been tightened just about as far as belts
can be tightened.
Yet, this week, we hear that oil company profits are again nearing or
exceeding record highs and that these companies have no plan and these
companies have no desire to increase domestic refining capacity--one of
the very few things we know would actually help bring down prices.
The Energy Information Administration and private sector energy
experts tell us to expect gasoline and diesel fuel prices to continue
to rise for the foreseeable future. I do not know what that means. I do
not think West Virginians care very much what that means. It just means
a long time. And a week, a month, is a long time. This is well beyond
the usual cyclical annual price fluctuation. And the so-called summer
driving season is not even here yet. But other than a brief dip in
January, the price West Virginians have been paying at the pump has
been climbing steadily since before Christmas--not as noticeable at
first, now catastrophic.
The average price for a gallon of regular gasoline in West Virginia
has risen from just over $2.70 a gallon in August 2007 to a price on
the last day of April 2008 of $3.71. I do not have new wage data for
workers in my State. I wish I did. But I am willing to stand on the
floor of the Senate and assert that nobody's salary has risen to match
that 37-percent increase.
The idea of $4-a-gallon gasoline--which 2, 3, 4, 5 years ago would
have sounded crazy--really now is a matter not so much of ``if,'' but
``when.'' The timeframe I just mentioned is relevant, of course,
because we are a country that has been at war in Iraq for more than 5
years--spending money, letting people do corruption at all levels. I am
always suspicious of oil companies. When our brave American forces set
out to impose regime change on that country based upon the false--or at
least unforgivably imprecise; I prefer the word ``false''--
intelligence, West Virginians were paying, on average, $1.63 for
regular gasoline. That was not that long ago. It had been as low as
$1.26 in the months leading up to the invasion.
It should come as no surprise to anyone within the sound of my voice,
but in that time oil industry profits have risen steadily: almost $60
billion in profits in 2003, just over $80 billion in profits in 2004,
approximately $110 billion in profits in 2005, just under $120 billion
in 2006, and just over $120 billion so far in 2007. ExxonMobil, Shell,
and ChevronTexaco have each had increasingly larger profits each of the
last 5 years. BP and ConocoPhillips have done nearly as well. In all,
the five largest integrated multinational oil companies have reaped
almost $560 billion in profits since President Bush and Vice President
Cheney came into town. I don't particularly want to do it that way,
because I blame the companies more than I blame them, but there is lots
of blame to go around.
Anyone who looks at the numbers can make this about politics, of
course. It is easy to do. But this is, in essence, for me, a former
Vista volunteer in my 44th year in West Virginia, all about people. It
is simply all about people and families who have been struggling
anyway. The average salary for the average working family of four in
West Virginia is $31,000. That is not a lot of money, before you get to
all of this, and then it is even less.
Today, if you are lucky enough to live or work near Sam's Club in
Vienna, WV, which is on the Ohio River, and you can afford to become a
member there, you can get a gallon of gasoline for $3.49. It is hard
for anyone I know in West Virginia to think of that as cheap, but it is
the lowest price reported in the entire State. Frankly, based on the
data I have seen, it is so much lower than the rest of the State that
you almost have to consider it an anomaly.
If you are running low in Spencer, WV, a rural community, however,
you need to be prepared to pay $3.82 at the Exxon station on Main
Street. It is $3.79 in South Charleston. Residents of Huntington are
paying $3.75. In Berkeley Springs, not far from Washington, it is
$3.69. No West Virginia county--none--is reporting an average price per
gallon of regular gasoline that is below $3.61. Only three of my
States' 55 counties are reporting average gasoline prices lower than
$3.67.
Individual price quotes at individual stations are ominous enough,
but the real stark numbers, the real telling calculation, is how much
more West Virginians are paying for gasoline than they were in years
past, and that is not even getting into the meteoric rises in food
prices and the other costs essential to daily living. Even those in
West Virginia who travel by air, which is the subject of the bill we
are meant to be on, those prices have gone up.
Since 2001, West Virginia households are paying almost $2,500 per
year more for gasoline. If it is a household with children, that makes
it $3,000. I take my colleagues back to the average salary for the
average family of four, working family of four in West Virginia:
$31,000. When you add on health care, food, rent, and all the rest,
everything else, it is an enormous matter. If it is a household with
teenagers, it is just below $3,600 more. Families, businesses, and
farmers in West Virginia will spend $153 million more on gasoline in
April 2008 than they spent in January 2001.
If prices remain at current levels, $1.83 billion more will be spent
on gasoline in West Virginia this year than
[[Page S3667]]
was spent in 2001. West Virginia consumers, farmers, and businesses are
on a track to pay $2.96 billion for gasoline this year.
So West Virginians are asking two questions: How did we get here; but
to them, much more importantly, what can be done to fix this.
Nobody in Government, academia, or the private industry can give us a
single definitive equation for what makes the price of oil go up and
down. We don't know why, but we can't. Generally, increased demand from
China, India, and much of the developing world has set the stage
obviously for prices that we have to take into consideration.
Much of our oil comes from an unregulated and unresponsive cartel
called OPEC. We also know that since the tragic terrorist attacks of
September 11, 2001, the world price for petroleum has been affected by
a global struggle against stateless thugs.
The instability brought about by the invasion in Iraq has done
nothing but raise the pump price. I don't know a single benefit to our
Nation that has been accomplished there. But smaller factors have also
had huge consequences. Instability in Nigeria and the outrageous
behavior in Venezuela have contributed in similarly negative ways. The
recent strike by refinery and pipeline workers in Scotland, unbeknownst
to many of our citizens, will not help. Likewise for the very serious
refinery explosion in Utah this week.
Economists cannot pinpoint how much speculation in the commodities
market is adding to the price of oil, but a congressional study in 2005
suggested it was in the $20 to $25 per barrel range. A more recent
study announced by Public Citizen said it is now closer to $30 a
barrel. It doesn't matter. Every cent of that is being seen at the gas
pumps in West Virginia and around the country, and it hurts, and trying
to give a worldwide economic explanation for it doesn't solve anybody's
problems or anybody's pain.
We know, too, that the price is manipulated up and down the supply
chain. Nobody will ever convince me that there is not a large amount of
corruption and manipulation, deliberate, cozy and easy, that goes on
around boardrooms in oil companies. From the huge oil companies that
find the oil, through more markets and middlemen than we can keep up
with, every player has the ability to force the price up for their own
bottom line. There is manipulation beyond the reach of my people in
West Virginia or the Presiding Officer's people in the State of
Colorado. We are at their mercy. We pay the price, we are at the
mercy--at the mercy of oil. Federal investigators cannot usually
pinpoint collusion, but those acting independently to manipulate prices
cost the people of West Virginia all the same. There are a lot of
things Federal regulators never manage to find.
In the long term, the things we need to do sound basic--and this is
the final part of my remarks and the important part, other than the
overriding theme of anger--such as increasing supply and
reducing consumption, but achieving these goals has proved to be very
difficult.
I have long supported efforts to improve automobile fuel efficiency,
and so have most other people--not all. We made a small and long
overdue change last year, and I believe we will do more. I think CAFE
standards are going to go up and up, as they should; cars will get
smaller and smaller, as they should. That will not be good for my legs,
but it will be good for my people. But even when Detroit catches up
with the rest of the world's automakers on fuel efficiency--I repeat,
catches up--we do need to add to our supply now.
That is why in 2006, I supported Senator Domenici's legislation to
increase oil and gas exploration in the eastern Gulf of Mexico. When
these new fields are fully on line, they will add 1.26 billion barrels
of oil to our domestic supply. Now, I say that, but I also have to say
in all honesty that I voted against virtually every other attempt to do
drilling offshore and in ANWR, for example. ANWR to me has always been
a shibboleth. People say: Well, we can get lots of supply there, just
as many people or more say it is technically feasible or maybe it is
economically feasible, but it is not both. In the meantime, the tundra
continues to melt.
That is why I have also consistently supported holding off on
additional deposits in our Strategic Petroleum Reserve. It is more than
97 percent full as it is, and there is no economic rationale for
filling it to the brim with $120 per barrel of oil. That product should
be making its way into the market some place.
I joined my colleagues earlier this year to ask the President to
suspend deliveries into the petroleum reserve until the price of oil
drops below $75 a barrel. Since the President persists in refusing to
stop taking oil off the market, I will support legislation to force him
to do it.
I also support, as I have in the past on several occasions, the
imposition of a windfall profits tax on integrated multinational oil
companies. People say this won't have any effect. I would like to try
that out to show that they are wrong and to send a message. The oil
companies are making so much money maybe they won't even notice it. But
I doubt that, because there are now 300 million Americans who are very
angry about what very few of them are doing. As I have said, these
companies are making huge, perhaps unconscionable--not perhaps--totally
unconscionable profits off the hard-working people in my State and off
the wages of struggling Americans everywhere. If they refuse to
reinvest in additional refining capacity, which has been their habit,
the least we can do is use some of those profits to shore up the
highway trust fund for the road infrastructure and transportation
projects that we need for the 21st century, and perhaps even for
something called aviation. Those projects would create jobs.
I will also reintroduce legislation this week that I first introduced
in 2001. It is called the Low Income Gasoline Assistance Program, or
LIGAP. This will provide some relief to Americans hardest hit by any
rise in prices; to wit, the working poor, which describes a lot of my
State. For many West Virginia seniors who have no means of getting to
work, the grocery store, or to a doctor's appointment other than their
cars or trucks, if they have them, LIGAP assistance for gasoline
purchases will enable them to weather this crisis with a little more
peace of mind. I say ``if they have them'' because many people in
communities I have worked in throughout West Virginia don't have
automobiles, so when they have to go somewhere, usually a pretty long
distance, they have to hitch a ride. Even though our people are
innately good and generous, because they depend on others as others
depend on them, they will usually charge a fee for that ride. In any
event, whether they can even take that ride will depend on whether they
can afford the gasoline price to get there.
So LIGAP eligibility would be linked to and modeled after LIHEAP, the
very successful and efficient home heating and cooling assistance
program. Funds would be distributed to States as additions to
allocations under the existing community development block grant
program.
It makes sense. For everyone who qualifies, LIGAP would give stipends
of between $100 and $165 a month. Hopefully, this may mean not having
to scrimp on their children's food or cut back on prescription drugs
and other family needs.
Families are the basis of our country. People are the basis of
everything we do. It is just that there are some sectors of our economy
that choose to avoid that because they don't have to depend upon those
people because those people have no choice but to buy their products.
It is time for Congress and the administration to come together and
stop bickering--it would be a majestic accomplishment--and stop
fighting over turf, as we are doing on the aviation bill. While we
engage in parliamentary tactics that most Americans don't give a hoot
about--in fact, they hate us for doing it--West Virginians and citizens
in every State are suffering, while oil companies are laughing all the
way to their many banks. This must stop. I ask my colleagues to work
with me to make this stop.
I yield the floor.
The PRESIDING OFFICER. The Senator from Alaska is recognized.
Mr. STEVENS. Mr. President, we import more than 12.5 million barrels
a day of petroleum--over 60 percent of
[[Page S3668]]
our petroleum energy needs. As a matter of fact, I think it is higher
than that now, in the last 2 or 3 days. This is why our economy and the
value of the dollar has weakened and our energy costs have skyrocketed.
With oil at $117 a barrel--and it is more than that today--the United
States spends nearly $1.5 billion each day on foreign oil. That is $533
billion each year that was not invested in our own economy.
Instead, that money is being sent--along with jobs--to other
countries, such as Saudi Arabia, Nigeria, and Venezuela. For every
million barrels of oil we import, 20,000 American jobs are lost.
Our country needs a real economic stimulus now. That stimulus will
come when we stop spending hundreds of billions of dollars each year to
import oil and, instead, invest that money in our own economy by
increasing domestic production of our energy resources.
The area known as ANWR is a million and a half acres that was
reserved for oil and gas development on the Arctic slope in 1980; it is
the largest untapped oilfield in North America. We believe that is the
largest trap for oil in North America. Oil companies estimate they will
spend between $45 billion and $60 billion to develop this area.
Combined with the construction of the Alaska natural gas pipeline,
which is expected to start soon, it will cost about $40 billion. These
resources would deliver a massive influx of jobs and capital investment
in the United States. Our economy would be stabilized, and the dollar
would be strengthened.
ANWR and the Alaska gas pipeline are only the beginning. This
infrastructure would help lead to further development of Alaska's Outer
Continental Shelf. We have more than two thirds of that Outer
Continental Shelf. It has been expanded another 100 miles north of
Alaska, as we discovered a further extension of the shelf. The Chukchi
Sea holds an estimated 16 billion barrels of oil, and there is an
estimated 7 billion barrels in the Beaufort Sea off our State. Bringing
these resources on line would add even more jobs and capital to our
economy.
Full development of ANWR would result in at least 60,000 jobs.
Opening ANWR alone would require the construction of a fleet of 19 new
tankers to transport the oil to the Lower 48. Those would be American-
built tankers. Under the law, they must be--under the Jones Act. This
alone would create at least 2,000 direct jobs in the U.S. shipbuilding
industry and approximately 3,000 additional jobs in other sectors of
our economy. The energy industry estimates the Alaska gas pipeline
alone will create 400,000 new jobs nationwide.
Senator Schumer made an interesting statement the other day. He
suggested that opening ANWR would reduce gas prices by only pennies. He
took a shot at the President, saying he takes out the old saw of ANWR,
that ANWR would not produce a drop of oil in 10 years, and it is
estimated that if we drilled in ANWR, in 20 years, it would reduce the
price one penny.
I am afraid that shows how little the Senator from New York
understands the oil industry. He ignores the long-term economic
stimulus domestic production will bring through investment in our own
country--raising household incomes and individual buying power, rather
than sending money overseas. Senator Schumer would ask other nations,
such as Saudi Arabia, to increase their production as a solution to our
energy crisis.
I agree that increased production would help solve our problem but
that production should occur in our own country. I think the Senator
should realize what is happening in terms of the oil industry, and the
key driver now to the cost of gasoline is not the supply and demand, it
is the value of the dollar and the value of oil per se. The value of
oil now is represented by paper on the New York Stock Exchange, which
has replaced gold. People are speculating in oil. That is also what is
causing the price of gasoline to go up at the pump. Senator Schumer
should visit NYMEX and ask them to do something about that and stop the
speculation in oil. I think it should be unlawful to speculate in
anything related to energy in this country. I think soon we will do
that.
This production has to come from our own country. The position of the
Senator from New York would send more money in tax and royalty revenues
outside our economy. I don't know how that will strengthen our dollar
or lower prices at the pump at all. It is not a question of supply and
demand, it is a question of a long-term commitment to restore our
capability to produce oil and gas in this country.
Had President Clinton not vetoed the ANWR bill before, we would be
producing at least 2 million barrels a day more out of Alaska right
now. I don't like to be chided by the Senator from New York about why
we don't have more production in this country. He is suggesting we ask
the foreign producers to produce more oil and send it to us. That will
send more money out of the country and take more of our jobs. I don't
understand that.
In 1995, when we approved the amendment allowing development of the
Arctic Plain, President Clinton vetoed that legislation, and we are
paying for the consequences of that today. Had he not vetoed the
legislation, the Trans Alaska Pipeline--which currently operates at
less than 50 percent of capacity--as a matter of fact, it is even worse
than that, about 38 percent of capacity. We are sending out about
700,000 barrels a day instead of 2.5 million barrels a day. We could
easily have that pipeline--we call it a barrel--full and offset imports
and keep our trade deficit down and keep jobs and money in our economy.
In the long run--not short run--increased production does affect the
price at the pump. We would continue to increase domestic production of
oil and that, in effect, would give us competition against the price
set by foreign producers, and we would be able to reduce the price at
the pump in the long run.
Between the Outer Continental Shelf, ANWR, the National Petroleum
Reserve in Alaska--which is now ready to be leased--and the resources
remaining in Prudhoe Bay, we believe we would have at least 45 billion
barrels of oil left to produce. That is an estimate. When they
estimated how much oil was in Prudhoe Bay, they estimated 1 billion
barrels. We produced 18 billion. I remind the Senate of that. So we
have produced more than that, and it is still producing. At full
capacity, we ought to be able to deliver at least 2.5 million barrels
to the daily market. We have oil from outside the Arctic, by the way.
We can reduce the impact of sending more and more money out of the
country and affect the American economy as we spend that money here at
home. That money would generate tax and royalty revenues, fund research
into alternative energy sources, create jobs, help strengthen the
dollar, and lower our energy prices in the long run.
The weak dollar is what is causing speculation in oil futures and
increasing the price of oil and gas at the pump. We need investment in
our own country, which develops our own resources, instead of relying
on those from other countries. By increasing domestic production, we
would meet our own Nation's needs, strengthen the economy, and begin
creating jobs and generating revenue, which would be reinvested back
into our economy. That is the way to a strong economy, a stable dollar,
lower energy prices, and to reduce the demand on foreign oil and the
cost of gasoline at the pump. We have to stop sending our money abroad
and sending jobs abroad to pay for energy resources, when we can use
the money at home to develop the vast resources we have.
Alaska is the storehouse of energy for the future. It should not be
cast aside as it has been. I hope we will find a way to vote on ANWR
this year.
I yield the floor.
Mr. DORGAN. Mr. President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. DORGAN. 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. DORGAN. Mr. President, my understanding is the pending business
is on the FAA reauthorization bill; is that correct?
The PRESIDING OFFICER. The Senator is correct.
Mr. DORGAN. Mr. President, I hope no one is out of breath this week
as a result of working on this bill. We had
[[Page S3669]]
one vote on Monday at 5:30 p.m. and have not voted since. With
legislation this important to this country, why are we not able to move
ahead and cast votes and finish this legislation?
This is about FAA reauthorization which includes the issue of
modernization of our air traffic control system, which is very
important. We read in the newspapers these days about the additional
inspections that are required of airlines. We read about airlines going
bankrupt because of fuel costs. We read that the FAA system for air
traffic control is archaic. We are told that the GPS system in your car
is more sophisticated than the system by which we move airplanes around
this country in the air traffic control system. We hear the problems
with the air traffic controllers, the contract problems they have had
with the FAA, the shortage of air traffic controllers, the number who
will retire in the near future, and the need for training of additional
controllers. We read about all these things in the news. We read about
systems that still use vacuum tubes in the air traffic control system
because it is that old.
The question for this Congress is, can we pass legislation that
reauthorizes the FAA functions and then provides the funding to
modernize this system of ours?
We have a lot of people who visit this Capital city, and most of them
fly in by airplane. This country moves back and forth quickly from
coast to coast using, in most cases, commercial air transportation.
They don't think very much of it, frankly. You can fly from one coast
to the other in 5 or 6 hours. It is not unusual to leave one part of
this country and end up in another part before lunch. It is a wonderful
thing to have this system of commercial air travel. The fact is, this
system will not survive for a number of reasons under the current
circumstances.
As I indicated the other day, I believe there are four airlines that
have declared bankruptcy in recent weeks. We also understand, in
addition, what high fuel costs are doing to the airlines, and we are
talking now about the airlines in this legislation before us. But I
could talk about the trucking industry, or I could talk about families
and farmers. I can talk about what the high fuel prices are doing to
all of this country. There is no heavier user of fuel than an airline.
What is happening is the fuel prices are undermining the opportunity
for many of these airlines both to continue operating, in some cases,
and, in other cases, to continue operating serving smaller areas or
less populated areas of the country. So fuel prices are a serious
problem.
The other issue is the modernization of the air traffic control
system, the system by which we provide for the safety of the American
people. There is going to be a catastrophe one of these days, and then
everybody is going to stand around thumbing their suspenders,
scratching their heads, and saying: Why didn't we do something about
it?
We have a bill on the floor of the Senate right now to try to address
this situation, to try to modernize this system, and we have been at
parade rest since Monday because we are not allowed to move forward.
Everything is blocked. Everything is plugged up. This is unbelievable.
This is important. Some people around here treat the serious things
far too lightly and then treat the light things too seriously and never
understand the difference. Why is it on a Thursday that legislation as
important as this, that should have been passed in previous years,
cannot even get amendments up and cannot get votes off because we have
people who have decided they are just going to block everything?
I told a group in North Dakota a while back about Mark Twain. Mark
Twain once was asked if he would engage in a debate. He said: Oh, sure,
as long as I can take the negative side.
We haven't even told you the subject of the debate.
He said: It doesn't matter, the negative side is going to require no
preparation.
The negative side never requires preparation. Those who are out here
saying, no, you can't, they want to block it. That requires no
preparation. What requires preparation is to advance public policy that
is in the interest of this country. Does anybody really think
modernizing our air traffic control system is somehow a back-burner
issue? We see what is happening in the skies in this country. They are
absolutely clogged. In fact, because of fuel prices and other reasons,
we have airlines now switching to smaller planes, these little regional
jets skirting around the sky, hauling as many people but just takes
more planes to do it. So that puts an unbelievable strain on the air
traffic system.
The question is, Are we going to modernize it? Are we going to do
what is necessary? Are we going to provide the funding? Are we going to
finally get off this delaying nonsense that is going on and allow
legislation to move forward that is essential for the safety of the air
traveling public?
I hope the answer at some point soon is yes. This includes items such
as the Airport Improvement Program, what is called the AIP, investing
in infrastructure in this country. That is very important. Land at some
of these airports and take a look at the infrastructure and ask
yourself whether we need this investment.
It is interesting, if you travel around the world. If you go to
Tegucigalpa, Honduras, and then get in a car and drive to Juticalpa.
Take a look at the roads and ask yourself whether infrastructure
matters. Land in some of the airports in some of these remote areas and
take a look at what you are landing on and the infrastructure needs of
that airport. Then ask yourself whether infrastructure is important.
We have always prided ourselves in this country on the investment in
infrastructure. When you come to America, you see infrastructure that
is maintained. We have always prided ourselves on that until recently,
and now somehow infrastructure doesn't matter. It takes a back seat.
In my little subcommittee on appropriations that I chair, the
President says: Let's cut water funding by $1 billion from last year's
levels for the Corps of Engineers and the Bureau of Reclamation. These
agencies fund much of the nation's water projects and were cut by $1
billion, even as we have 950 water projects in this country which we
are paying for in Iraq. Think of that. Let's cut water projects in this
country and investment in the future of this country by $1 billion, the
President says. However, let's have 950 water projects that the
American taxpayers will pay for in Iraq.
I think it is time to start taking care of a few things at home. One
of them is the legislation on the floor of the Senate right now, and
that is the FAA Reauthorization Act and the investment and the
modernization of the air traffic control system. If we do not pay
attention to that, we are going to run into very serious problems. I
might also say, tragic problems because there is going to be some sort
of spectacular tragedy, and then we are all going to sit around and say
that somebody should have done something.
We are trying to do something. The fact is, we cannot even get a vote
on an amendment on the floor of the Senate. It is unbelievable. As I
said in the Mark Twain example, the easiest thing in the world is to
oppose. It takes no talent, it takes no time to prepare, just oppose,
oppose everything.
My hope is in the next couple of hours, perhaps there will be some
here who wish to move ahead. I know Senator Reid has been on the floor
offering unanimous consent requests. He has talked with the minority to
see if there are conditions under which we might be able to move
forward and get something done on some legislation. I understand it
takes a while to get things done. I understand we should be
deliberative. I understand there should be enough research so we don't
have unintended consequences to what we do. Nobody has ever accused
this body of speeding, ever, But this is ridiculous. This makes a
glacier look fast.
My hope is that those of us who are elected to come here, who try to
make some improvements in this country, who do what is necessary for
the health and safety of the people of this country will soon
understand that the FAA reauthorization bill is not just some other
piece of legislation, that it is an optional piece of legislation. The
modernization of the air traffic control system is not some option that
we ought to consider like any other bill. This is urgent and necessary
and timely, and we ought to do it now.
[[Page S3670]]
Energy
Mr. DORGAN. Mr. President, I wish to talk about energy. Several
colleagues have spoken about energy prices, and I related energy prices
to the airline industry a few moments ago. I mentioned several
bankruptcies that have occurred recently, intensive heavy users of
energy in the airline industry, and what it might mean. This country
needs a commercial airline industry that works. Without it, there will
be devastating consequences to our economy. The question is, What do we
do here?
My colleague from Alaska made a point with which I agree. He talked
about the speculation in these markets with respect to energy. I wish
to talk about that issue. I have some charts.
This is a chart that shows the speculator activity in the oil futures
market from January 1996 to April 2008. This is the activity by
speculators in the futures markets. These are not people who want to
buy oil or hold oil. They have no tanks in which to put oil. They are
not interested in oil. They want to buy what they will never get from
people who never had it. This is what speculating is about.
Here is the increase in speculation in the commodities market for
oil. It is an unbelievable ramp-up, an orgy of speculation, having
nothing to do with the fundamentals of oil supply and demand. There is
no justification for the current price of oil if we simply look at
supply and demand. Supply is up a bit; demand is down a bit. There is
no justification with the current fundamentals of supply and demand
that would seriously justify the current price of oil.
So then what has changed? What is different? Why is this price $115
or $120 a barrel for oil, acting like a yo-yo at the upper end? A
couple issues have changed, especially this. We have hedge funds that
are now neck deep in the commodities markets speculating on oil. We
have investment banks that are speculating on oil. For the first time
in history, I believe, investment banks are actually buying oil storage
capacity to buy oil and take oil off the market to sell it later when
it is more expensive. This is speculation, raw speculation. I suppose
everybody is making money. The brokers are making money, the investment
banks, the hedge funds--they are all wallowing to the bank full of
cash, driving up the price of oil beyond what the fundamentals would
suggest the price should be.
We know those people who are winning, but who are the losers? Well,
our country. This is something that is providing great damage to our
country's economy. Families drive up to the gas pumps, and it hurts to
fill the tanks. Farmers, heavy users of energy and fertilizer that
comes from energy, are losers. It is an unbelievable burden on family
farmers. Airlines, they just cannot fly through this storm. They go
belly up. The list goes on and on.
If this is what is happening with the ramp-up of speculation and it
is causing an increase in prices, here is what has happened to oil
prices. No one needs a chart to know this, but oil prices doubled in
just over one year. Speculation goes up, up, way up, and oil prices
have doubled in one year.
Let me cite some folks who have talked about this issue. Stephen
Simon, senior vice president of ExxonMobil, April 1, a month ago:
``The price of oil should be about $50-$55 per barrel.'' This from an
executive in the oil company. I do not think his company is complaining
about where the price is. He is just being candid. According to him,
the price of oil ought to be about $50 or $55 per barrel, assuming
current fundamentals.
Clarence Cazalot, CEO, Marathon Oil, October 30, 2007:
$100 oil isn't justified by the physical demand in the
market.
Experts, including the former head of ExxonMobil, say
financial speculation in the energy market has grown so much
over the last 30 years that it now adds 20 to 30 percent or
more to the price of a barrel of oil.
Think of that.
Speculation in the energy markets has grown so much over the last 30
years that it now adds 20 to 30 percent or more to the price of a
barrel of oil.
I understand the need for a marketplace futures market. It is
required for hedging. It is required for liquidity. I understand it is
necessary, and I understand we want one that works so there needs to be
a futures market, but I also understand that when the futures market
becomes something much more than just something that provides for
hedging and liquidity. When it becomes an object of intense
speculation, then there is a requirement for some intervention. No one
quite knows what that intervention should be, but everyone ought to
know that it is unhealthy when you have an unbelievable amount of
speculation.
There are books written about bubbles in speculation. We have been
through recent speculations. The tech bubble that occurred almost a
decade ago. The bubble in housing prices is occurring. We have seen and
understand about bubbles. This is a bubble of speculation.
Go back 500 years and read about tulip mania. If you have not read
about it, I encourage to you do it. Yes, tulip mania. There was a time
you could buy a tulip bulb for $25,000. With the hindsight of 400 or
500 years, we can understand how unbelievably absurd it was, but it was
a bubble, a financial speculative binge that was almost indescribable.
What is happening in this marketplace now--and most experts will
agree--is we have this unbelievable amount of speculation in the
futures market that does not justify the current price. The American
people and American industry deserve to have a government, in those
cases, that steps in and says: There is something wrong here, and we
are going to find a way to set it right. This is one of the areas.
This man--in fact, I talked to this man last evening--Mr. Fadel
Gheit, the top energy analyst for Oppenheimer Company. He has been
there 30 years, he has testified before the Congress, and he is a very
interesting fellow.
There is absolutely no shortage of oil . . . I'm absolutely
convinced that oil prices should not be a dime above $55 a
barrel. . . . Oil speculators include the largest financial
institutions in the world.
He said further:
I call it the world's largest gambling hall . . . it's open
24/7 . . . unfortunately it's totally unregulated . . . this
is like a highway with no cops and no speed limit and
everybody's going 120 miles an hour.
That is pretty well said, it seems to me. It describes this bubble of
speculation that does damage to our economy and needs to be addressed
by this Government. It is not the case that everybody hurts as a result
of this.
This is a Wall Street Journal article of February 28, 2008. This is
Andrew Hall. I wouldn't know Andrew Hall from a cord of wood. I just
see his picture here. Over the past 5 years, Mr. Hall's compensation
has totaled well over a quarter of a billion dollars.
What does Mr. Hall do? He makes money by speculating in the
commodities market, according to this article. He is not alone. I
pulled this because it is an article about him and he has made a lot of
money. He has made a lot of money as someone who speculates in these
commodity markets.
Is speculation something that is good for these markets? Absolutely
not. When you have a speculative binge that drives these prices way out
of sight, well above that which would be justified, it can be
devastating to the country's economy.
That describes what is happening with respect to speculation. To
address the issue of energy, it requires a lot of things. We must do
this. If we do not address the issue of speculation, we are not going
to solve the problem. We are just not.
But there are other things to do. For example, this administration is
putting close to 70,000 barrels of oil a day, every single day,
underground. It is being put in something called the Strategic
Petroleum Reserve. The Strategic Petroleum Reserve is a pretty good
idea because it saves some oil for a rainy day. But just not for any
rainy day, for an emergency, strategic emergency, something
unanticipated, so we developed it for this purpose. That makes sense to
me. But should we take oil when it costs $115 or $120 a barrel and
stick it underground, 70,000 barrels? Of course not. That is absolutely
nuts. Why would you take the highest priced oil in history, take it out
of the supply, stick it underground and by doing so increase the price
of oil and increase the price of gasoline?
A man named Dr. Philip Verleger testified before the Congress. He is
an economist and energy expert. He said that, by taking a
disproportionate amount of oil, a subset of oil called
[[Page S3671]]
sweet light crude, out of the supply chain, it has increased the price
of oil by 10 percent. You know, with more than $100 a barrel oil, that
is at least $10 a barrel for light sweet crude. It is the most
Byzantine thing one can imagine.
I have a piece of legislation to stop it. There are now 67 U.S.
Senators who have declared themselves to be in support of my approach.
There is also a very similar bill that was introduced just the other
day by some in the minority, and John McCain running for President out
in the country said he supports it. So I have 51 who have signed a
letter saying they support suspending the SPR fill for 2008. On top of
that, some Republican Senators numbering 15, led by Senator Hutchison,
also sent a letter to the President. That takes it to 66. John McCain
is out there saying he doesn't believe we should do it, so there are at
least 67. That makes it a veto-proof margin. So I say let's do it. End
the speculation, and there are ways to do that. Second, stop putting
oil underground. That ought to be important.
In addition to all of that, let me just say the other menu of issues
is not really very complicated either. Should we produce more? My
colleague from Alaska says you have to produce more. I don't disagree
with that. I was one of four Senators here in the Senate who introduced
legislation, now law, that opens up Lease Sale 181 of the Gulf of
Mexico. It opens up an opportunity to substantially increase our
production of both oil and natural gas in a new region of the Gulf of
Mexico. Frankly, if you look at the offshore capability of the Gulf of
Mexico and compare it to the offshore options off the West Coast, East
Coast or in Alaska, by far the most significant reserves that are
achievable by us are in the Gulf of Mexico. We have not even tapped the
potential of the Eastern Gulf either.
I and three others initiated the legislation that opened up a portion
of the Gulf of Mexico, Lease Sale 181. But there is a lot more to do
because it got too narrow. Ought we go back there and produce? You bet
we should. There is more production to be had.
In addition to that, conservation is unbelievably important and so is
efficiency. Production, conservation, efficiency, and then renewable
energy.
Again, we have new technology that allows us to take energy from the
wind. I come from a state that has the most wind potential in America.
My state has a distinction of being No. 50 in trees, so we are last in
America in trees, and we are first in wind. I am not sure where the
merits are there, but all of us who live there lean to the northwest
because it blows almost every day. We are the Saudi Arabia of wind, as
the Department of Energy suggests, and with the new modern wind
turbines, we will continue to take energy from the wind and produce
electricity.
We have a great experiment going on in which we produce electricity
from wind energy and use that electricity in the process of
electrolysis, separating hydrogen from water and storing hydrogen for
vehicle fuel. It all makes a lot of sense and helps contribute to our
energy future.
There are a lot of things we can and should do. This is not some
mysterious illness for which we do not know the cure. This is not some
strange disease for which we have no cure. We understand what is
happening here, and with a little common sense, perhaps a deep
reservoir of common sense, we could begin to fix it. At the very least,
we ought to begin to take immediate action to stop putting oil
underground, and stop it now. It is time to take some action to stop
the unbelievable orgy of speculation in the futures market, and do that
soon. Those are the first two steps, and they will reduce the price of
gasoline. There is much more to do beyond that, but those are the first
two sensible steps we ought to accomplish now.
I yield the floor.
The PRESIDING OFFICER (Mr. Nelson of Nebraska). The Senator from
Minnesota.
Ms. KLOBUCHAR. Mr. President, I am here today to speak on climate
change. Before I do that, I commend my colleague, Senator Dorgan, for
all of his good work on this oil and gas issue. We have been working
together on a number of things he talked about and I do believe that,
while I will talk today about the long-term solutions to our energy
crisis and the way this can work hand in hand with climate change if we
show the kind of leadership we need to show, there are also short-term
issues. That means, as he said, cutting down on the speculation,
putting things in place, closing down the Enron loophole. In terms of
enforcement, to have the Justice Department get some meat on the bone--
as a former prosecutor, I know how important that is--and pushing those
OPEC nations with which we have business dealings. If we are going to
have business dealings with them, then they should not be cutting down
or artificially keeping low the production of oil.
Climate Change
Ms. KLOBUCHAR. Mr. President, I think there are a number of things we
can do in the short term, but I am here today to talk about the long-
term energy future and climate future for this country.
In 1944, President Franklin Delano Roosevelt invited delegates from
the Allied Powers to a remote New Hampshire resort called Bretton Woods
to discuss the future of the global economy. Although the world was
locked in a terrible war, these leaders had fresh memories of the Great
Depression, a worldwide panic that had left the world's major economies
in tatters. They wanted their countries to emerge from World War II on
a more stable financial footing.
Over the course of 3 weeks, they created the World Bank and the
International Monetary Fund to battle world poverty and to avert
currency crises of the sort that had led to the worldwide economic
meltdown in the 1920s. It worked. Both the World Bank and the IMF have
had their share of controversies in the last decade, but they succeeded
in stabilizing the world's financial systems so that in the ensuing six
decades there has never been a global financial disaster comparable to
the Great Depression.
I draw on this chapter of history because today the world faces
another grave international threat that demands imagination and
leadership. This time, the threat is environmental. I am speaking, of
course, of global climate change.
The heating of the Earth is a threat every bit as grave as the
financial catastrophe that threw the developed world into chaos 80
years ago. The science is clear. Global temperatures are up 1 degree in
the last century. That doesn't sound like much, 1 degree in the last
century. To put it in perspective, they have risen only 5 degrees since
the height of the ice age. The Environmental Protection Agency of this
country predicts that temperatures could rise another 3 to 7 degrees in
the next 100 years. The consequences are frightening: rising ocean
levels, which we are already seeing, increased drought, wildfires, and
destructive weather patterns.
The Presiding Officer knows from being in the Midwest that our
constituents aren't as focused on rising ocean levels. But I can tell
you, in Minnesota they are focused on the fact that last year Lake
Superior was at the lowest level in 80 years. Why would the oceans be
high and Lake Superior be low? That is because Lake Superior, as you
know, is a lake, and when the ice that forms on that lake melts
quicker, the water evaporates and the water level goes down. Why do we
care about that? You think, are you going to swim in that cold lake? A
lot of Minnesotans, probably not, but it matters because our barges
cannot get through and it has had a severe economic impact for barge
traffic and the economy in the Duluth area.
You can see the rising impacts of global warming and what we are
seeing across the country: increasing wildfire risk--remember the fires
we had this year in California? We had some in northern Minnesota as
well--decreasing water availability. That is in 2007. You go up to the
2020s, increased mortality from heat waves, floods, and droughts; in
the 2050s, millions more people face flooding. You go up, if we do not
do anything, to some profound and very serious consequences.
Two weeks ago, President Bush gave a speech in the Rose Garden to
announce a new initiative on global warming. To be perfectly blunt, I
really didn't see anything new in the President's announcement and no
initiative that had not been discussed before. The President has
proposed that we wait
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until the year 2025 before we even stop the increase in the emissions
of greenhouse gases.
He did not call for a cut in emissions that was immediate. He did not
call for concrete steps to meet the goals. He said it would be unwise
to do it at this time.
I believe Americans are leaders not followers. When the world faces a
crisis, they do not wait for someone else to go first. Our country has
always stepped in and taken leadership. When we see a problem in our
own backyard--and my people in Minnesota see shrinking wetlands and
endangered wildlife, they have seen what has been going on with our ski
resorts and ice fishing--they do something about it.
Our friends across the seas in Europe have recognized the challenge.
They have introduced a plan to cut greenhouse gas emissions covering 27
countries. It is a plan covering more than 12,000 industrial sites in
27 countries. And they did it using a concept known as cap and trade.
This was actually started in our country. That is how we reduced acid
rain. The European Union did not do everything right. They will be the
first to admit that. Their emissions targets were too high. They issued
too many carbon permits. But they are getting it back into equilibrium.
I believe we are going to learn from what they did, and we will do
better when we do it in this country. But the point is, many of these
European countries rose to the challenge and took leadership.
Here at home, our country's private investors and business leaders
already recognize this challenge. Nationally, venture capital
investments in green and clean technologies have increased
dramatically. In 2006, venture capital investment in green technologies
in the United States reached $2.9 billion, up 78 percent from a year
earlier.
Not only is clean technology the fastest growing venture capital
sector, it is now the third largest category of venture capital
investment. So when we talk about some of the things Senator Dorgan and
I have been talking about with energy, and we mentioned wind, we
invented a lot of that wind technology in our country. But now we have
fallen behind in wind production to other countries that have
government policies in place that pushed that investment.
From what I can see, wind is going to bring jobs across our country.
So is solar. So is biofuels. All of these things that cut our
dependency on foreign oil and invest in the next generation of new
technologies, that money is starting to filter into that area. But I
think we can do better in our country.
CEOs from major corporations such as DuPont, Duke Energy, and General
Electric see the opportunities, and they are making investments of
their own. More than 200 major U.S. corporations such as American
Electric Power and DuPont have started buying carbon offsets that are
now traded on the new Chicago Climate Exchange. You can see the global
investments I talked about in renewable technologies that have been
increased in wind, in solar, and other kinds of renewable technologies.
A company subsidizes a project that reduces greenhouse gas pollution,
building a wind turbine, for example, then recoups its investments by
selling that offset to another company on the Chicago Exchange. The
Chicago Exchange is new, but it reports that it kept 10 million tons of
carbon dioxide out of the atmosphere over the last 4 years.
Meanwhile our Nation's Governors and mayors have also stepped up to
the challenge. Governors in five Western States, including California
and Arizona, have announced they will work together to reduce
greenhouse gasses by setting regional targets for lower emissions and
establishing a regional cap-and-trade system for buying and selling
greenhouse gas credits.
California alone plans to cut its greenhouse gas emissions 25 percent
by the year 2020. The Western Greenhouse Gas Initiative builds on other
regional initiatives, especially the landmark New England Regional
Greenhouse Gas Initiative, with seven Northeastern and Mid-Atlantic
States that have also agreed to a regional cap-and-trade system set to
take effect next year. You can see all of the States that have been
involved.
In my home State of Minnesota, we have one of the most aggressive
renewable electric portfolio standards in the country; a 25-percent
reduction. We did this on a bipartisan basis. We did it with the
support of ExelEnergy, our biggest electricity company. We did it the
way we do things in Minnesota, with a focus on results and getting
things done--Leadership.
There is also the U.S. Mayors' Climate Protection Agreement. More
than 400 mayors representing over 59 million Americans have pledged to
meet or beat the Kyoto Protocol greenhouse gas reduction goals in their
own communities. Among the signatories to this agreement are cities in
my home State of Minnesota: Minneapolis, St. Paul, Rochester, and
Duluth.
I admire these States and communities that have signed onto this
agreement for their initiatives and what they are doing. They should be
an inspiration for this Congress for national action. There is a famous
phrase, ``the laboratories of democracy.'' That is what Justice
Brandeis said in one of his most famous opinions when he described the
special role of States in the Federal system.
He said:
It is one of the happy incidents of the Federal system that
a single courageous State may, if its citizens choose, serve
as a laboratory; and try novel social and economic
experiments without risk to the rest of the country.
But Brandeis did not mean this would serve as an excuse for inaction
by the Federal Government. We have States all over this country,
Governors, legislatures that have been brave, that have been courageous
in taking action on climate change. But never, when Justice Brandeis
talked about the one courageous State going above the norm, doing
something different, did he mean there should be inaction by the
Federal Government. Good ideas and successful innovations are supposed
to emerge from the laboratory and serve as a model for national policy
in action. That is now our responsibility in Congress.
In about 1 month we will have the chance to take up that
responsibility. We will have the opportunity to vote in the Chamber on
landmark climate change legislation, the Lieberman-Warner bill. I thank
my colleagues, Senator Warner and Senator Lieberman, for their hard
work on this bill. I thank our chairwoman, Senator Boxer for her
leadership as it moves forward. At this very moment we are listening to
Members make changes to the bill, doing everything we can to make the
bill as strong as possible.
The truth is, we can no longer delay. I have been to Greenland and
have seen those humongous icebergs melting in the ocean, and I have
seen the effect of this in my own State.
The Union of Concerned Scientists estimates if we start today and cut
emissions by just 4 percent a year, we could achieve an 80-percent
reduction in greenhouse gas emissions by 2050. But if we wait just 10
years, we would have to double that annual rate of reduction.
This is forward-looking, bipartisan legislation. It is comprehensive,
and it is carefully tailored. It is our opportunity to show the
leadership for which Americans have always been known.
I pledged last week I was going come to the Senate floor and give a
speech about this legislation on different aspects of why it is so
important to move forward and to show leadership on climate change.
Today, I think it is obvious that as we face these long-term
consequences of doing nothing with our energy policy, when it comes to
electricity or oil, this is our chance. This climate change legislation
will play a major role in developing the new technologies we need.
Mr. DORGAN. Will the Senator yield for a question?
Ms. KLOBUCHAR. I will yield.
Mr. DORGAN. Mr. President, the Senator from Minnesota talked about
the importance of renewable energy, which I certainly agree with her.
Is it the case with renewable energy that we have done a pretty
pathetic job as a country to incentivize renewable energy?
In 1916, we put in place tax incentives to produce oil and gas. They
have been in place permanently for almost a century now, tax incentives
to produce oil and gas. By contrast, with wind and solar and renewable
energy, we put them in place in 1992 short term incentives. We have
extended them short
[[Page S3673]]
term five times and have let them expire three times. It has been a
pathetic response to renewables.
The current tax incentives expire at the end of this year, and I have
introduced legislation to extend the production tax credit for 10
years. I believe our country ought to say to the world and to
investors: Here is where America is headed for a decade. Count on it.
Believe in it. Renewables, solar, wind, and so on need a clear signal
for investment. You can count on these investments because this is
where America is going.
Is it not the case, I would ask the Senator from Minnesota, that we
have not nearly done the job in incentivizing renewables and
establishing a national policy. Does she agree?
Ms. KLOBUCHAR. Senator Dorgan, that is completely accurate. When you
look at what we have done with oil companies, with the giveaways that
we had for years and years and years, this Senate was one vote short of
blocking a filibuster. We tried to change that, tried to take some of
those oil giveaways and put them in the hands--we see record profits
from the oil companies--put them in the hands of some of these
renewables producers.
We were one vote short, but we have another opportunity. That is what
the Senator from North Dakota is talking about, extending the tax
credits for wind energy, solar, geothermal, and other kinds of
renewables.
We did it in the last bill we passed through this Senate. We were
able to, with some of the economic work we did with the mortgage
crisis, extend that tax credit for 1 year. But we would like to do it
for longer. Senator Dorgan has a bill for 10 years. I have a bipartisan
bill with Senators Snowe and Cantwell expanding it for 5 years. The
problem is, it has been a game of red light, green light. It goes on
again, off again. It is hard to follow that investment, to follow in
the way that we would like and the way that happens in other countries
because they never know. You can show, 8 months before these tax
credits go off, that the investment decreases.
This is no way to run a national energy policy. It is no way to run a
national environmental policy. And that is why today I spoke about the
leadership and the potential for leadership in this country.
We once put a man on the Moon. With that came not just winning the
race against Russia, with it came all kinds of technology: the CAT
scan, the space sticks that my family would take on camping trips in
the 1970s. With that came technology. That is what we are trying to do
with this bill.
I yield the floor.
The ACTING PRESIDENT pro tempore. The Senator from Montana.
Drugbusters' Summit
Mr. TESTER. Madam President, I would like to thank the Senator from
Minnesota and the Senator from North Dakota for their comments on
renewable energy and climate change. That is definitely an issue I hope
we take up sooner rather than later, and hopefully we will have some
commonsense solutions to the problem so we can move this country
forward both in the area of reducing our effects on climate but also
economically because it is a tremendous opportunity with the right
piece of legislation.
I rise today to urge the inclusion of the JAG/Byrne grant funding in
the emergency supplemental that we will consider in the coming weeks. A
week ago, I organized a summit of drugbuster law enforcement in my home
State of Montana. I asked all of the leaders of Montana's drug task
forces to come together to talk about Federal funding. It is a
critically important issue.
Many of them drove hundreds of miles across the State in a spring
blizzard to take part in this summit. The drug task forces are made up
of dedicated law enforcement officers from every part of Montana:
sheriffs' deputies, narcotics officers, local and State police, and
undercover agents. They work together across jurisdictions to bust drug
smugglers, as well as those who grow or manufacture instate.
Our State of Montana has 56 counties. There are, of course, a lot of
different regions that deal with the task forces, that deal with
catching the drug manufacturers and smugglers. It is critically
important that these folks work together.
There is cause for concern because the President proposes slashing
$350 million from the drug task forces nationwide. If that happens,
Montana will lose a staggering 70 percent of its national drug fighting
money for the upcoming year, and the task forces would probably have to
lay off 27 agents, leaving only 22 agents to battle drugs statewide. In
a State the size of Montana that is impossible.
We should not let that happen. We should find a way to fund these
drug task forces in this supplemental, this spending bill that we are
going to be considering in a few weeks. If we do not, these cuts will
cripple the progress that we have made up to now in the war on drugs in
rural States such as the State of Montana.
These drug task forces are success stories. The officers who are on
the front lines keep drugs, the drug smugglers, and the drug dealers
off our streets. They make our communities safer; they reduce crime,
and they make a place like Montana a whole lot safer to live and raise
a family. These drug busters work together to get the job done.
Because drugs are not limited by borders, these tasks forces rely on
Federal funding to facilitate the cooperation across the many
jurisdictions of Montana, and it works.
Last weekend, folks picking up some trash in Havre, MT, stumbled
across a dumped meth lab. They called the police, and within minutes
the task force agents were there on the scene to help clean it up and
keep the community safe.
A week ago Monday I heard about a drug operation busted in a remote
part of southeastern Montana; so remote, in fact, the task force needed
the help of the National Guard helicopter to find it. Officers found 3
pounds of methamphetamine.
Last summer, the Northwest Montana Drug Task Force investigated a
case that took them across State lines to Salt Lake City, UT. In the
end, they seized 2 pounds of cocaine. They took 20 illegal weapons off
the streets, and they say they couldn't have done it without their
ability to work across jurisdictional lines and work together. For
example, one task force busted a meth lab in a home. Through
surveillance, they knew children were present. They took the
precautions not to put the children in any more danger. When the bust
was made, one child inside tested positive for meth because he was
living in a house where they were cooking meth. Even his toys were
covered with meth resin. This case set the standard for the way
officers deal with and protect children in harm's way. In only 1 year,
Montana'a drug task forces rescued 84 children from homes where they
were being exposed to drugs and drug dealers.
To me, restoring this funding is a no-brainer. As one of the officers
put it: We will end up spending much more money in the future if we
have to play catchup.
During the summit last week in Montana, officers told me again and
again that without Federal funding our small communities will be
devastated. Our children will be exposed to more drugs and, therefore,
more crime, and families will be torn apart.
I hope we can all work together to restore this funding. Montana and
the Nation cannot afford to do otherwise. Americans deserve better.
I yield the floor and suggest the absence of a quorum.
The ACTING PRESIDENT pro tempore. The clerk will call the roll.
The bill clerk proceeded to call the roll.
Mr. BINGAMAN. Madam 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. BINGAMAN. Madam President, I ask unanimous consent to speak as in
morning business for 15 minutes.
The ACTING PRESIDENT pro tempore. Without objection, it is so
ordered.
Energy Prices
Mr. BINGAMAN. Madam President, I wish to take a few minutes to
discuss what has become a very tortured topic for the entire country;
that is, the prices for oil and gasoline and diesel.
I would like to respond, first, to the President's misstatements
about Congress's role in this situation. These
[[Page S3674]]
are misstatements he made on Tuesday at his press conference. Then I
would like to talk about what I believe are some of the real causes of
the energy situation and what constructive steps we can take to address
those causes.
First, with regard to the President's statements, on Tuesday he
suggested the Congress is to blame for the current price situation
Americans are seeing when they go to fill up at the gas pump. He cited
three reasons to conclude that.
First of all, he was blaming Congress for preventing oil companies
from exploring for oil and gas in the United States. Second, he was
blaming Congress for blocking efforts to build more refineries in the
United States. Third, he was blaming Congress for blocking increases in
the U.S. nuclear electricity production capacity.
Frankly, I think the President's comments are disappointing in
several regards. First, of course, they are very partisan. But second,
the charges the President made are simply not borne out by the facts.
On exploration and production of natural gas in this country,
Congress has taken significant steps on a bipartisan basis to enhance
oil and gas production. Through enacting the Gulf of Mexico Energy
Security Act of 2006, Congress made available 4.74 trillion cubic feet
of natural gas and 1.26 billion barrels of oil off the Florida
Panhandle.
Ironically, Congress was required to pass that law because of steps
that were taken early in the Bush administration. In her first year in
office, in 2001, Secretary of the Interior Gale Norton cut the size of
the scheduled Outer Continental Shelf lease sale in the area by 75
percent. So with the stroke of a pen, the Secretary of the Interior, in
2001, put off limits over 6 trillion cubic feet of natural gas and over
1 billion barrels of oil from an area that had been proposed for
leasing by the Clinton administration, I would say, with the
concurrence of our former colleague, Lawton Chiles, who was then the
Governor of Florida.
So while, undoubtedly, a politically popular stance for the Bush
administration in Florida when this action was taken by Secretary
Norton, this was hardly an action that was intended to enhance oil and
gas production in the country.
In fact, large areas of the Outer Continental Shelf are currently off
limits to oil and gas development and production not just because of
congressional moratoria but because of Presidential withdrawals that
were first put in place, in 1990, by the first President Bush. This
current President Bush could exercise real leadership in this area, if
he wished to, by eliminating these Presidential withdrawals that were
first put in place by his father.
We are talking about a significant area. There are some 574 million
acres of the OCS, or Outer Continental Shelf, that are unavailable for
leasing, and virtually all that is covered by Presidential withdrawals,
which could be eliminated by this President with the stroke of a pen.
The Arctic Refuge is another issue raised by the President. He failed
to mention drilling in the Refuge will do nothing to address the high
price of gas people are faced with today. I think everyone who has
looked at the issue recognizes that not a single drop of oil would come
to the lower continental United States from the Arctic Refuge for at
least 10 years.
The Energy Information Administration has estimated that production
from the Arctic Refuge would, at its peak, reduce our reliance on
imports by about 4 percent, from 68 percent to 64 percent. That is the
estimate the Energy Information Administration has given, which, of
course, is part of our own Department of Energy.
Other areas of Federal lands that are much more appropriate for
development can and should be drilled. In fact, of the 45.5 million
acres of Federal onshore lands currently under lease by industry, there
are over 31 million acres of those lands that are not currently being
produced. Likewise, there are 33 million acres of Federal Outer
Continental Shelf that are under lease; that is, the Government has
done what it should do to make these areas available, but they are not
being produced.
The processing of drilling permits on Federal lands has surged over
the past several years. It has more than doubled between 2001 and 2006.
At the same time, the administration reported that in five key basins
in the Rocky Mountain States, 85 percent of oil resources and 88
percent of natural gas resources are currently available for leasing
and for development.
Congress has also funded important research and development programs
to enhance the best of production. It is simply inaccurate finger
pointing to say that Congress is impeding oil and gas development in
this country.
On refinery capacity, which is the second point the President made in
his press conference, refining capacity has increased by about a
million barrels per day during President Bush's tenure, from 16.6
million barrels per day in 2001 to 17.5 million barrels per day in 2007
through capacity expansion and existing refineries. There have been no
efforts from Congress to try to slow down that expansion. Refiners have
been asked whether they would like to build new refineries as opposed
to expanding capacity at existing refineries, and those refiners have
told us in hearings before our Energy Committee that they would rather
expand capacity at existing refineries. We have never heard support
from anyone inside the oil industry regarding the President's curious
plan to build refineries on former U.S. military bases. As far as I
know, no Member of Congress objects to that; it is just that the
companies that are in the business of constructing refineries have not
decided that it makes good sense for them from an economic point of
view.
The economics of refining are not very good at the moment, as
gasoline prices are not yet fully reflecting the jump in crude oil
prices. U.S. refining capacity is at about 85 percent utilization at
the current time, as many refiners are losing money on every gallon of
gasoline they produce. Clearly, constraining refinery capacity is not
our current problem.
The third issue the President attacked the Congress about was nuclear
energy production. Here again, Congress is not standing in the way of
increasing nuclear production capacity. In fact, Congress over the past
3 years has put in place one of the most favorable sets of incentives
for nuclear power development anywhere in the world.
For example, if a nuclear plant is proposed for licensing and is
delayed because of a lack of action by Federal regulators, the
proponents of the plant can get Federal payments to compensate for that
delay. Now, that was part of the 2005 legislation we passed. No wind
power developer can get that kind of a subsidy. No solar power
developer can get that kind of a subsidy. We also provided tax
incentives for the construction of new nuclear powerplants. So if the
Congress passes global warming legislation--I know the administration
and the President are opposed to that, but if we do, according to the
Energy Information Administration, the most significant impact of that
global warming legislation would be to provide a powerful new incentive
to promote more nuclear power development in this country.
So let me move on from the discussion of the President's charges to a
short discussion of what I consider the real causes of current oil
prices. I think to understand what is going on here, it is critical to
put these oil prices in the broader economic context. The current
increase in oil prices is, to a large degree, a symptom of our ailing
economy. Oil prices and the value of the U.S. dollar have been very
strongly linked over the last year. As the value of the dollar
declines, oil prices go up.
We have heard recent testimony before our Energy Committee that
confirms that investors are seeking protection from inflationary risks
associated with the weak dollar and from credit and wider financial
markets in which they have lost confidence. As one witness put it, oil
has become the new gold, and that is why speculators and others are
investing in oil. Higher oil prices in turn weaken our economy, so we
are caught in a downward spiral in which a weak economy is resulting in
high oil prices, and high oil prices are, in turn, further weakening
the economy.
So the question is how do we stop this downward spiral. This is a
large task. It requires, first and foremost, a return to rational
fiscal policy that will restore balance and investor confidence in our
markets. That includes
[[Page S3675]]
an honest accounting of the costs of the war in Iraq, a figure that we
now know is going to be in the trillions of dollars. Spending has also
been accompanied by the administration's tax policies which have been
extremely damaging to the country's long-term fiscal health. Every
American family that sits around the kitchen table and tries to balance
a budget recognizes the simple fact that spending more than you earn or
more than the revenue you can bring in results in, after a period, your
creditors eventually coming calling. That is what is happening to the
dollar today. Apparently, the stewards of the U.S. economy and this
administration have failed to absorb that simple reality.
Let me talk a little about policies to reduce oil prices in the short
term. There are modest but important measures we can enact to increase
our oil supply and reduce our demand. On the supply side, we need to
immediately stop removing oil from the market to fill the Strategic
Petroleum Reserve. It simply makes no sense to be putting $120 per
barrel oil underground. According to the most recent Energy Information
Administration forecast, oil demand in the United States is expected to
decline by 90,000 barrels per day in 2008. This is the kind of signal
we need to send to the market in order to see some relief from current
prices. However, we are taking 70,000 barrels per day off the market to
add to the Strategic Petroleum Reserve which we all recognize is about
97 percent full right now. We are basically wiping out any positive
effects from the decrease in demand. This is a policy completely
wrongheaded and should be stopped immediately. I compliment all three
of the candidates for President for embracing this recommendation that
we eliminate the filling or we suspend the filling of the Strategic
Petroleum Reserve. I wish the administration would support that simple
measure.
On the demand side, we need to decide whether we are ready to get
serious about educating consumers to take more responsibility to reduce
consumption. We know that 5 miles per hour slower that a person drives
will increase our fuel efficiency for that individual by about 7.5
percent. We also know that energy-efficient, properly inflated tires
increase fuel efficiency by about 4 percent. Regular car maintenance
can increase fuel efficiency by about 2 percent. So Americans
individually could use about 10 to 15 percent less gasoline by adopting
these commonsense measures. But to see we do that, we will need
publicity out there to educate folks on the simple steps they can take
to reduce consumption. In the medium term, we need to ensure there is a
cop on the beat on the oil markets.
There are two key steps we should take to improve Government
oversight of the oil markets. First, the Secretary of Energy needs to
have a role in overseeing oil markets. It troubles me that the people
at the New York Mercantile Exchange on which oil is traded and the
Commodity Futures Trading Commission which regulates that exchange seem
to be the only people who think that speculators are not influencing
oil prices.
Here is a quote from the Wall Street Journal on March 21 of 2006. It
says:
Hedge funds are taking ever-larger bets in a futures market
that is smaller than the stock or bond markets, and the funds
are using borrowed money to maximize their bets, magnifying
the impact on energy market prices.
So clearly, the Secretary of Energy and the 500-plus employees he has
there in his Energy Information Administration who work every day to
analyze energy data, forecast energy supply and demand, and prices
should at a minimum provide insight and advice to market regulators at
the Commodities Futures Trading Commission. Perhaps this could help the
Commodities Futures Trading Commission come to understand the role of
speculators in that market.
Second, we need to shed light on the so-called dark markets. Markets
that trade U.S. oil or are located in the United States should be
subject to U.S. regulation. It is unacceptable that an exchange that is
based in Atlanta, GA and trades U.S. crude oil that is delivered in
Oklahoma is regulated in the United Kingdom, not subject to the laws
and regulations that we in Congress put in place to govern the U.S.
futures market. It is also unacceptable that over-the-counter markets
are regulated neither here in the United States nor in the United
Kingdom. There is simply no regulatory body that can see these over-
the-counter transactions.
Let me also say a few words about policies that will not reduce
gasoline prices. First, there is a proposal to suspend the tax on gas
and diesel. While I can appreciate the temporary public relations
success that might accompany this tax suspension, it would come at the
expense of fiscal common sense and sound energy policy. I agree that
high gasoline and diesel prices are hurting consumers, but additional
deficit spending will only help accelerate the downward trajectory of
our economy as a whole. This is simply the latest in a long line of
proposals that seek to score political points during an election year
at the expense of good energy policy.
There are three main objections to the proposal. First, it would
increase deficit spending by nearly $10 billion while saving motorists
about $25 per person. If you do the math, you find that even if all of
the savings are passed on to the consumer, which is a very unlikely
outcome, the savings per person is negligible.
If you assume that the average motorist drives 12,000 miles per year
and gets 22 miles per gallon, you can calculate that the amount the
average person would save in a 3-month period is $25.50. So adopting
the fuel efficiency measures I have discussed earlier, including
shaving a few miles per hour off the top highway speed, would be much
more effective in reducing the cost of gasoline to the average
consumer.
Madam President, how much time remains?
The ACTING PRESIDENT pro tempore. I believe the Senator has used his
15 minutes.
Mr. BINGAMAN. Madam President, I ask unanimous consent for an
additional 5 minutes.
The ACTING PRESIDENT pro tempore. Without objection, it is so
ordered.
Mr. BINGAMAN. Madam President, the second argument I wanted to raise
related to this proposed suspension of the gas tax is the idea that it
would be reinstated in September when prices might well be as high or
higher than they are today would be very difficult and very unlikely to
occur, frankly. We are talking about reinstating the gas tax in
September. I think that is the proposal the Senator from Arizona has
made: Let's suspend the gas tax now, or at Memorial Day, and let's
reinstate it on Labor Day. Well, the problem with that is Labor Day is
about 2 months before the election. It would not be politically
feasible to have a single-day price increase on September 1st of 18.4
cents per gallon for gasoline and 24.4 cents for diesel. I don't think
anybody--any politician in his or her right mind--would vote to impose
that kind of a tax increase at that time. Prices could easily be as
high or higher on September 1 as they are today. It is simply not
possible to me that Congress will then choose to increase the price
that consumers pay at the pump.
The third argument is that this tax suspension would stimulate demand
for motor fuels without increasing supply. In fact, we would see
something in the nature of a price increase. The best explanation of
this was done by Paul Krugman, a respected economist who writes for the
New York Times and teaches at Princeton, in an article he did on April
29. He said in that article, I think the conclusion was, the McCain gas
tax plan is a giveaway to oil companies disguised as a gift to
consumers.
The obvious point he was making is that under the basic rules of
economics, the fact that Congress would suspend the gas tax would do
nothing to ensure that consumers benefited from the suspension of the
gas tax. The whole notion that you are going to see the price of gas at
the pump drop 18 cents because Congress says the tax is all of a sudden
suspended is not realistic.
In conclusion, we as a country and we as a Congress need to get
serious about energy policy. It is an election year. While there is
always a tendency to take rhetorical stands in the runup to an
election, the American people understand that. I think they discount
what they hear from Washington as the
[[Page S3676]]
election date begins to arrive. That is one reason they don't always
hold Congress in the highest esteem. Proposals that are mostly feel-
good propositions do not fool voters for long--if they fool them at
all.
That said, there are a number of concrete steps we can take that will
help. We should freeze the filling of the Strategic Petroleum Reserve--
suspend that for the time being. We should take some effective actions
to bring the oil markets under better control with U.S. laws and
regulations. Let's be sure consumers know what they themselves can do
to reduce their own demand. I hope that with oil at $110 to $120 per
barrel, which it has been for several weeks and which it may well be
for several more weeks or months ahead--or even a longer period--I hope
we will give this topic the serious attention it deserves.
I yield the floor and 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. CORNYN. Madam 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. CORNYN. Madam President, today, marks more than 2 years--by my
count, 738 days--since Speaker Pelosi said:
Democrats have a commonsense plan to help bring down
skyrocketing gas prices.
That was on April 24, 2006--738 days ago. I think it is important to
look at what has happened to the price of gas and to see whether her
prediction was correct.
Lo and behold, we find the average price of a gallon of gasoline in
America at $3.62, up $2.33 from the time when Speaker Pelosi became
Speaker in January of 2007. Again, that is a rise from $2.33 a gallon
to $3.62 a gallon.
I will tell you we have been asking and waiting, and the American
people have been waiting and watching, to see what Congress is going to
do to help relieve some of this pain at the pump. The American people
want us to work together to try to find commonsense solutions to help
them with this increasing pain they are feeling in the family budget.
Do you know that taking the difference between $2.33 a gallon and
$3.62 a gallon represents roughly a $1,400 increase in the cost for
gasoline for the average American family? Of course, I don't have to
tell anybody here, or anybody listening, that this is necessary for
driving the kids to school, driving to work; it is necessary also to
provide fuel for the airplanes Americans fly in. This is an American
problem, and I suggest we need to come up with an American solution.
The problem has been that about 60 percent of our energy needs in
this country are now satisfied by imported oil and gas from other parts
of the world. That is a national security challenge because, of course,
to the extent which others supply our energy needs, it means they can
turn off the spigot; or if hostilities were to occur that would, let's
say, for example, block the Strait of Hormuz, there could be an
economic body blow to the United States as a result of the restriction
on our energy supply.
We need to recognize there are certain things that are irrefutable
or, I should say, maybe unchangeable by Congress. We can pass a lot of
laws and repeal laws, but we cannot change the law of supply and
demand. Try as we might, Congress has neglected that for these many
years. While we have done some good things on conservation, passing
fuel efficiency standards recently, and we have also supported
renewable fuels, which are an important part of the energy supply, you
cannot put wind energy in your tank to drive your kids to school.
We need to recognize that with a fixed supply of oil, which is 70
percent of the price of gasoline, we are competing globally with
countries such as China and India, rising economies where people want a
better quality of life, and they realize one key to that is affordable
energy. America has not had that exclusively, but we have had it pretty
much to ourselves, and others want what we have, which is a good
quality of life and standard of living. That comes with affordable
energy.
So what are we going to do about satisfying the laws of supply and
demand? Of course, we know Congress is the primary culprit when it
comes to obstructing access to American natural resources. I remember
that when I was growing up, we would talk about different countries in
school and about how some were blessed with abundant natural resources
and how that was a good thing because the citizens of that country
could use those natural resources to enhance their quality of life--in
this case, provide for affordable energy. But we have simply, by our
inaction--and I would say to the extent it applies--actually acted
affirmatively to place our natural resources out of bounds in a way
that has exacerbated and not solved the problem.
I know how popular it is these days to say it is all big oil's fault.
The blame game. Then we have people saying we need another
investigation. Well, the blame game and investigations are important,
and investigations and oversight is for Congress, but that is not
producing a single drop of additional energy. We need to do that and we
need to act today.
A moment ago, a group of Senators announced an omnibus energy bill
that would satisfy America's need for more American solutions to our
energy supply. My hope is that by taking advantage, for example, of the
million-barrel-a-day capacity Alaska could supply, by taking advantage
of the Outer Continental Shelf, such as we have in the Gulf of Mexico,
with the vast oil deposits there, and by taking advantage of our
abundant natural resources in the form of oil shale in the West, we
could relieve our dependence upon imported oil in this country to the
tune of some 3 million barrels a day.
I know there are environmental and safety concerns with developing
our oil and gas resources right here at home. But I invite the people
who are concerned about that and who do not believe we can do so to
come to Fort Worth and see the Barnett shale, which is an abundant,
plentiful source of natural gas being developed right in the city of
Fort Worth. As a matter of fact, if you fly into DFW Airport, you will
see drilling rigs on the airport property. The tract of land in Alaska
that is going to be explored and used for producing this million-
barrel-a-day-plus oil that is located in the Arctic is going to be on a
postage stamp-size piece of property.
I see the distinguished ranking member of the Energy Committee. I was
saying the city of Fort Worth is producing the Barnett shale and
actually drilling gas at DFW Airport and that you can see the rigs
there.
I suggest that if we can produce those natural resources in Texas and
in Fort Worth on the DFW Airport property, American energy producers
can do it in Alaska. People are concerned, as they should be--and I
wish they would act on those concerns and not just complain about it--
about $120-a-barrel oil. It has been projected that if we were to take
advantage of the natural resources God has blessed us with in the
Arctic, we could produce oil there that costs roughly $55 a barrel. So
$120 a barrel or $55 a barrel? You pick.
If we are talking about developing oil resources from the Outer
Continental Shelf, even beyond the horizon, as we did in lease sale 181
in the Gulf of Mexico--it is 300 miles off the coast of Texas. You
cannot even see it. Yet we have a way of producing those abundant
resources. If Congress will simply quit the blame game, the finger-
pointing and wake up to the fact that the American people are feeling
pain not only at the pump but in their family budgets--they are looking
for Congress to get out of the way and let the American people produce
the natural resources we have been blessed with, in a way that will
satisfy the laws of supply and demand, by producing as much as 3
million barrels of additional oil, which will then have a dramatic
impact at the pump and help American families meet their energy needs
at a reasonable price.
The ACTING PRESIDENT pro tempore. The Senator from New Mexico is
recognized.
Mr. DOMENICI. I didn't hear the Senator from Texas say he was
finished.
(The remarks of Mr. Domenici pertaining to the introduction of S.
2958 are printed in today's Record under ``Statements on Introduced
Bills and Joint Resolutions.'')
[[Page S3677]]
Mr. CORNYN. Yes, I yield the floor.
Mr. DOMENICI. I thank the Senator.
Mr. DOMENICI. Madam President, I ask unanimous consent that the floor
time now be given to Senator Kennedy, who has been patiently waiting,
for which I am grateful.
The ACTING PRESIDENT pro tempore. The Senator from Massachusetts is
recognized.
The ACTING PRESIDENT pro tempore. The Senator from Massachusetts is
recognized.
Mr. KENNEDY. Madam President, I thank my friend and colleague from
New Mexico. We will not have a chance today to talk about mental health
parity. But whenever I see him speak on the floor I am further inspired
to make sure we are going to get that legislation passed in this
Congress. I thank him for all of his good work in that undertaking. We
are strongly committed to ensuring that this very important health
policy issue is going to be addressed in the Congress.
I see my friend from Illinois. I know he was seeking the floor. I ask
unanimous consent that he be recognized after I finish.
The ACTING PRESIDENT pro tempore. Without objection, it is so
ordered.
Unemployment Insurance Extension
Mr. KENNEDY. Madam President, tomorrow we are going to have the
report by the Bureau of Labor Statistics about the unemployment figures
in this country. Those unemployment figures may be statistics to some,
but they are lost hopes and dreams to millions of our fellow citizens.
They are a key indicator of the state of our economy. I think most of
us who have had the opportunity to travel our States and listen to
working families understand the extraordinary pressures these families
are under, the incredible anxiety that goes to the heart and soul of
these families. They really wonder if somehow they are guilty in some
way for not being able to deal with the economic challenges they are
facing, whether it is the increased cost of gas at the pump, or whether
it is the increasing cost of tuition, the increasing cost of health
care, or the challenges they are facing with their mortgages.
This afternoon I want to speak for a few minutes about the issue of
unemployment and how that has impacted so many of our fellow citizens
and what the implications are for so many of our fellow citizens. Even
though we do not have the figures, I think we can reliably suggest
there is going to be a further increase in the number of unemployed
Americans when we get the figures tomorrow morning. These are the
figures so far this year: we see 76,000 jobs lost in January; in
February, 76,000; some 80,000 in March--232,000 jobs were lost over the
period of these 3 months. There were 50,000 construction jobs lost.
That sends a message in and of itself.
If we look at this chart, we see the total number of unemployed.
These are the Bureau of Labor Statistics figures. In March of 2008 we
have 7.8 million unemployed and only 3.9 million jobs. That's two
workers for every job. Here we have individuals, Americans, who have
worked hard, played by the rules, and, through no fault of their own,
because of the failure of fiscal and monetary policy, they have lost
their jobs. Yet when we look back at the total number of job openings,
they are limited. These Americans are getting squeezed. How are they
going to be able to find jobs when the jobs are not available even if
they have the skills? We are going to come back to that in just a
moment.
These families are hurting. That is why it is so important that we
have an increase in the unemployment compensation program that is now
in surplus of about $35 billion. That fund has actually been paid into
by American workers. They have paid into the fund $35 billion, and the
reason they paid in was for circumstances such as this, a fiscal and
monetary economic policy which has failed them. They are entitled to
receive the unemployment compensation. Yet we have an administration
which has consistently opposed extending unemployment benefits. I am
going to come to that in just a moment too.
Here are recent veterans who having served, are having a hard time
finding work. The total workforce, 5.1 percent unemployed; for these
veterans serving after 2001, we can see their unemployment is 6.1
percent. And the young male veterans, serving after September 2001, are
at 11.2 percent. These are all veterans, but this is young men--11.2
percent. These young Americans were the ones who had the burden of
conflict and now they are facing the burden, at home, of an economy
that will not serve them and serve their interests. Where is the burden
falling? It is falling on our young veterans, and it is falling
particularly hard.
This chart indicates where the burden of this economy is falling. We
are finding out it is increasingly falling on adult women, who are
seeing a sharper rise in unemployment rates than men. There is a 21-
percent increase for women, and 15 percent for men, between March of
2007 and March of 2008. Do we understand how it is squeezing women?
Women are more likely to have subprime mortgages than men, despite
having slightly better credit scores. Women are having their homes
foreclosed at a more rapid rate than men, their unemployment rates are
going up, and their savings are lower. They are the ones who are taking
the brunt of this recession along with young veterans.
Here we find women's earnings are falling faster than men's. Men's
median income in 2007 fell one-half of 1 percent for men, women's fell
3 percent. We see increasing numbers of women are unemployed, and the
wages of women who have jobs are being adversely impacted to a much
higher and more significant degree.
We see what has happened generally with regard to the economy. The
stock market lost $2.7 trillion in value since May of 2007. This crisis
has wiped out $2.7 trillion in home values. The dollar has lost one-
third of its value, and the Federal debt has nearly doubled since this
President took office. Again, we are looking at home values, which is
the wealth for so many middle-income and working families--$2.7
trillion effectively has been wiped out during this last year.
All these figures show middle-income families, working families, are
taking the heavy brunt of the recession we are facing. We should ask
ourselves what are we doing about this. If we look at what we have done
at other times, we have granted extended unemployment benefits. Look at
the last recessions we have had, from January 1980 to July 1980, and
then July 1981 to November 1982, the average number of weeks of
unemployment was 16 weeks. And we extended unemployment compensation.
The next recession we had was July 1990 to March of 1991. The average
weeks of unemployment was 13.9 weeks, but we had an extension of
unemployment compensation.
In March 2001 to November 2001, 15 weeks was the average number of
weeks of unemployment, and we had an extension of the unemployment
compensation.
Here, look at this: 16.2 weeks is the average number of weeks workers
are unemployed today--16.2 weeks--and this administration refuses to
say the $35 billion that is in the unemployment compensation fund that
you have worked for and contributed into that fund, should be available
to you when we have adverse economic conditions. These are just the
kind of conditions that they are there for. This administration refuses
to do anything about it. It is a striking difference for working
families who are trying to make it and provide for their families.
Very briefly, this chart demonstrates that during a recession, among
the limited economic stimulus measures, unemployment compensation is
among the most promising investments--every dollar we invest in
unemployment compensation has the effect of $1.64; for infrastructure
it is $1.59 for every dollar invested; and it is $1.73 in food stamps.
This is from Moody's chief economist. There is much less impact,
obviously, for the Bush extended tax cuts.
We should look at what is happening in food stamps--we do not
frequently think about the numbers of our fellow American citizens who
are dependent on food stamps, but we should pause now. We certainly
should if we have been back home and listened to those who have been
running the food banks in our States and we find out the condition of
those food banks. 28 million Americans are projected to receive food
stamps in fiscal year 2009--28 million Americans are going to be
eligible for food stamps in 2009. Look at the indicators. This is
another indicator
[[Page S3678]]
about what is happening in the economy, the kind of pressures that
middle-income and working families have.
We could also ask, Why aren't we trying to provide training for these
workers who are struggling to find a job? If we improve their skills,
they will be able to find a job--is that right? No, it is wrong. What
we are finding is Americans cannot access job training programs. This
administration has been cutting back virtually every year on job
training programs.
Look at this. In Massachusetts alone, for every available slot in a
job training program there are 21 workers on a waiting list. Do we
understand? There are 21 workers on a waiting list. These are American
men and women who want to work, have worked, want to provide for their
families, and they cannot even get the training in order to be able to
fill the jobs. We have 83,000 jobs in my State that are not being
filled today, but we have cut back. This administration has cut back on
the training programs. This is the kind of misstep this administration
has taken time in and time out.
I just remind the Senate about action that we took just yesterday
with regard to students and the student loan program. One urgent step
that we must take to ensure that the slumping economy does not prevent
young people from going to college is to provide some help and
assistance, and we did yesterday.
Right now, in May, students and their parents are applying for
financial aid and the loans they need to attend college in the fall.
This is happening just as some banks have said they are no longer
offering student loans. We cannot allow the slumping economy to limit
the horizons of a new generation of Americans. Students and parents
need to know we will do everything we can to guarantee that every
single student who needs a loan to go to college in the fall will get
one, even in these troubled economic times. We will increase the amount
of grant aid available to relieve the debt burden on needy students.
Yesterday the Senate passed legislation to do just that. The House of
Representatives also passed the legislation just a few hours ago, and
President Bush has indicated that he will sign it into law. This is
what the emergency legislation does: For students, if private loans
through the banks dry up, they can get lower cost government-guaranteed
loans to take their place. So no matter what happens in the private
loan market, the government loans will be there, and they will be there
for them.
This guarantee comes in two ways. First, the bill expands the amount
of Federal loans available for a student for 4 years of college from
$23,000 to $31,000, an $8,000 increase. Second, it ensures that
students will have easy access to Federal loans.
If banks are not willing to make these loans to students, State-
based, nonprofit agencies, called the guaranty agencies, will take
their place.
So for every student, there will always be someone to provide the
loans, either through the private sector or through the Government.
Also, for thousands of low-income students, we increased the grant
aid by up to $1,300 a year for underclassmen and $4,000 a year for
upperclassmen. That is not a lot, but it is a part of an ongoing
commitment to help low-income college students avoid the crushing
burdens of debt that inevitably distort their choices for the future.
The bill also helps parents by providing them with better options and
better access to the low-cost Federal PLUS loans alternative. This
provides help to parents. It allows the parents to delay the repayment
on the loans until their child has graduated from college. It makes it
easier for parents who have been hit by the mortgage crisis to obtain
these low-cost loans; help for the students, help as well for families.
Finally, the bill helps stabilize the overall student loan market by
authorizing the Secretary of Education to purchase outstanding federal
loans, allowing private lenders to replenish their capital so they can
make new loans to students and parents.
For the 6 million students and over 700,000 parents currently relying
on low cost federally subsidized loans, these steps mean they will
continue to have ready access to these funds, even as the credit
markets discourage lender participation in the Federal program. In
other words, students and parents will now have multiple avenues to
obtain low-cost Federal loans.
Fortunately, Congress has taken prompt action to prevent college
students from becoming the next victims of our failing economy, and I
commend President Bush for urging us to do so. I am grateful to Senator
Enzi, Congressman Miller, Congressman McKeon for their partnership on
this legislation, and for the support and assistance of the Secretary
of Education.
I hope we can replicate this bipartisan effort in tackling other
urgent economic issues. There is much work to be done to ensure that
Main Street is insulated from the problems of Wall Street. It is clear
that the Nation faces a serious ongoing economic challenge. We know
what we have to do to put our economy and our country back on track. To
do that we need to seize the moment and act immediately to help the
millions of Americans who need our help the most.
I yield the floor.
The ACTING PRESIDENT pro tempore. The Senator from Illinois is
recognized.
Mr. DURBIN. Madam President, I see the Senator from Michigan on the
floor. I know she is here to address the same topic as the Senator from
Massachusetts, and she has a 5 o'clock conference committee on an
important bill pending before the Senate. I ask unanimous consent that
she be allowed to speak in my place and that I follow her.
The ACTING PRESIDENT pro tempore. Without objection, it is so
ordered.
The Senator from Michigan is recognized.
Ms. STABENOW. I thank our distinguished assistant majority leader for
allowing me to do this. It is very important. I thank my colleague and
friend, the champion from Massachusetts, for all of his efforts as they
relate to the efforts to make sure college loans are available. Also I
want to speak to the fact that we are working together to extend
unemployment insurance benefits, and I greatly appreciate his
leadership.
I want to specifically today speak to that piece of the effort we are
working on together. Because since my colleagues across the aisle
blocked extending critical unemployment benefits from the part of our
first stimulus package, frankly, the situation has only gotten worse
for families in Michigan and all across the country.
National unemployment is on the rise, with our Nation losing 80,000
jobs in March. It is stunning to me when we look at what is happening
across the country. I have to say, these are not new kinds of numbers
for us in Michigan. We have been seeing these kinds of numbers now for
a number of years but we see nationally, in this last January, 76,000
jobs were lost; in February, 76,000 jobs were lost; in March, the
highest number, 80,000 jobs were lost; 232,000 jobs cut in the past 3
months.
I remember coming to the floor and having colleagues say: Well,
overall unemployment is not high. We do not have a problem. It is below
5 percent. Well, now it has crept up above 5 percent, and we are being
told by Goldman Sachs and the Bureau of Labor Statistics that by
January, this coming January, the national unemployment rate will be
6.5 percent.
We in Michigan would actually consider that a decrease, because ours
is at 7.2 percent. But nationally when we look at that kind of steep
increase in those people who are out of work, we need to be paying
attention to this. Families, middle-class families, who have worked
hard all their lives are finding themselves in a situation, due to no
fault of their own, where they are looking for work, trying to keep
their family together and, in fact, are looking for us to do what we
have always done in times such as these, which is to extend
unemployment benefits across the country for families, and particularly
for those States that are hardest hit.
We have 10,000 people right now in Michigan every month who are
losing unemployment benefits. That for us relates to the fact that we
are one of the highest States in mortgage foreclosures, why people
cannot afford to pay for their mortgage. So the ripple effect
throughout the economy is staggering when we look at the fact that on
[[Page S3679]]
top of what is happening to people who are losing their jobs and cannot
afford their mortgage, their gas, when we look at what is happening
with gas prices.
We in the majority have been coming to this floor and have been doing
everything we can in putting forward proposals to deal with the high
gas prices. We have not been able to get support from colleagues to
truly address this, what needs to be addressed, and even putting food
on people's tables and health insurance.
Everything is going up in the wrong direction, including the fact
that people are now losing their unemployment benefits. We have been
suffering in Michigan through several years of high unemployment, as I
mentioned. We have 7.2 percent unemployment right now. In the first
half of this year, over 72,000 people exhausted their unemployment
benefits. But we are not alone. This is not only a Michigan problem
anymore. Alaska, California, Rhode Island, Mississippi, Nevada,
Missouri, Oregon, South Carolina, Kentucky, Ohio, all have unemployment
rates at or above 5.7 percent. Across the country, millions of
Americans are losing what are insurance benefits. We are not talking
about public assistance, we are talking about an insurance system that
they paid into, that employees come into for these circumstances.
We have not seen the President's willingness, up to this point, to
support extending unemployment benefits and, subsequently, my
colleagues on the other side of the aisle. This makes absolutely no
sense. Frankly, from an economic standpoint, it makes no sense.
Moody's economy.com chief economist Mark Zandi estimates for every $1
spent on unemployment benefits, the economy is stimulated by $1.4. We
knew that when we passed the original stimulus package. Rather than a
rebate, many of us were arguing that the best way, the fastest way to
stimulate the economy was to give dollars directly to people out of
work, struggling to make their payments, who on average make 40 percent
of their wage from this unemployment insurance system. The people would
have to turn right around and go to the grocery store, buy clothes for
their children, spend the dollars they receive in unemployment benefits
in order to be able to keep going. What we have heard over and over
again from colleagues on the other side of the aisle is: We should
wait; we should wait; it is not that bad; it is not bad enough. I do
not know how many times we have heard the President say, up until
recently, ``Well, the underlying fundamentals of the economy are good''
or ``Things really are not as bad as people think.''
Well, they are. They are. The American people know that when they are
being hit on all sides with rising costs and lower wages. So I am here
today to urge my colleagues to come together to understand what
American families are going through, and to support, strongly support,
an extension of unemployment compensation.
Let me say in conclusion that this unfortunately is a pattern we have
seen over and over again when it comes to blocking those programs that
are critically important for American families. Over and over again we
see colleagues filibustering issues, stopping us from moving forward on
what makes a real difference in people's lives.
It is not only extending unemployment insurance for families and
workers in Michigan and across the country, but it is part of a pattern
of blocking and obstructing what is important to families in this very
difficult economy. Last year my colleagues on the other side of the
aisle blocked an energy tax bill that would have increased the
production of renewable fuels and helped bring more advanced technology
vehicles to the marketplace to reduce our dependence on foreign oil and
begin to address what is happening on the gas price side of things.
But, unfortunately again, these efforts were blocked time and time
again when we brought forward proposals that relate to energy and
pricing and accountability for the industry. Moving tax breaks from oil
companies to alternative fuels or to consumers, we have been blocked. I
have to say also in conclusion today that once again, a critical issue
to this safety of the American public has been blocked, and that is the
question of whether we are going to modernize air service in this
country; whether we are going to truly have a passenger's bill of
rights; whether we are going to update a system that is clearly
overloaded, clearly in crisis. We have been trying all week to bring to
the floor critical changes to upgrade the American airline system, and
once again these efforts have been blocked and blocked and blocked. We
have a whole range of needs in this country that are urgent for the
safety of those of us who are flying with our families and are counting
on the fact that everything that is being done to make sure that system
is the best in the country and it is safe.
We see that families are struggling with gas prices. We see in my
home State again 10,000 people a month losing unemployment insurance
who are trying to figure out how to make ends meet while we see
blocking after blocking, filibuster after filibuster, here in the
Senate stopping us from moving forward on important legislation.
I urge my colleagues to listen to the folks at home and what they are
going through, and to join us to extend unemployment insurance, to
address what are outrageous gas prices, and also make sure we are being
serious and responsible about important issues such as airline safety.
I yield the floor.
The PRESIDING OFFICER (Mr. Whitehouse). The Senator from Illinois is
recognized.
Mr. DURBIN. My thanks to my colleagues from Massachusetts and
Michigan for bringing to our attention the struggle this economy
presents to many families across the United States.
You would almost find it hard to imagine that this Senate could meet
with such regularity and not address these issues directly. But this
administration and its economic policies have not focused on working
families. They have focused on tax breaks for those in the highest
income categories in America. That is something they do without
embarrassment. They suggest that if the wealthy people in America have
extra money to spend, it will be good for everyone else. That is a hard
message to deliver and even harder to believe.
Elizabeth Warren is a professor of law at Harvard Law School in
Cambridge, MA, and has become a good friend and adviser to many of us.
She recently made a presentation to a number of Senators and showed an
analysis which she had done relating to the middle of the middle class.
Professor Warren took a look at real middle-income families and
basically asked the question: What has happened to them during the last
7 years?
Her findings are troubling. From 2000 to 2007, she writes, the
American family lost ground. Measured in real dollars, incomes declined
while basic expenses skyrocketed. By the time today's family makes a
few basic purchases--housing, health insurance, food, gasoline, and
phone--it has about $5,700 less than it had been in 2000.
Now, this is a family that is making in the range of $40,000 to
$45,000. So a decline in buying power of $5,700 over the last 7 years
causes real hardship. By every measure, incomes are down for the same
hypothetical family for this same period of time; down for fully
employed males, fully employed females, down for households.
Adjusted for inflation, median household income has declined across
America by $1,175. Prosperity has not arrived to the working class, the
working families of America. In fact, the opposite has been true.
Of course, the biggest thing we face going home is the increasing
cost of gasoline. The increase in the cost of gasoline has more than
doubled since President Bush became President. In that same period, the
profits of the oil companies have more than quadrupled. It is no
coincidence. They are making more money as families, rich and
especially poor, reach deeper into their pockets to pay for gasoline.
Families have reduced driving. They have to spend an average of $2,000
more a year for gasoline than they did back in the year 2000, when
President Bush was elected. Our friends on the Republican side of the
aisle like to talk about cutting people's taxes, sending out rebate
checks. Of course, those are all well and good. But it turns out the
expense which has been passed along to working families for the cost of
gasoline
[[Page S3680]]
since President Bush became President is more than $2,000 a year. There
is a tax. It is a tax families have to pay if they have to drive to
work or if they want to take their family on vacation.
Increases in mortgage costs took another big bite out of middle-
income families, almost $1,700 each year. Health insurance, food,
telephone, appliances, another $750 a year knocked out of the family
budget. The increases mean the average family is spending $4,564 more
for basic expenses now than they did in 2000. How about families with
kids? Childcare costs under this President have gone up by $1,321 a
year, more than $100 a month; afterschool care, $511 a year. All
parents, regardless of the age of children, see the rising cost of
college. Under this Presidency, the net cost of college, including
scholarships and grants, has increased by more than $1,000. Is it any
surprise, when Members of the Senate and the House go home over the
weekends and run into these families, they want to talk about the
latest outrage, which happens to be the price of gasoline?
My understanding is ExxonMobil made its report of quarterly earnings
public today. It was a little bit off for them. Their earnings only
increased 17 percent, hardly keeping pace with the recordbreaking
percentage increases of the past. But trust me, there will be no tag
days for those CEOs and members of the executive board and management
of the biggest oil companies in America. They are doing quite well. The
question is whether this Congress can do well by American families who
pay the price for those profits. That is a challenge we will face.
President Bush is going to send us a supplemental appropriations
bill. It is because of the emergency in Iraq. He is going to ask for
$108 billion for Iraq and Afghanistan. He is not going to ask for the
emergency in America, and there is one. He will not be asking for
increasing unemployment compensation for families out of work, watching
unemployment rates rise by the day. He will not be asking for tax
breaks for those struggling families I have described. He focuses on
the Middle East.
I am from Illinois. I focus on the Middle West. I try to look at the
whole Nation, but I start with my obligation at home. When I look out
the window in the morning, I see America. When this administration
looks out the window in the morning, it sees Iraq. So when it comes to
emergency spending, drop everything, highest priorities, it is not
about America. This administration focuses on the Middle East.
I think that is unfortunate. We need to understand a strong America
begins at home. It begins with a strong economy, strong families,
strong churches, strong temples, strong neighborhoods, strong cities,
strong communities that build a great nation. They are suffering at
this moment.
During the course of this week, there has been precious little done
on the floor of the Senate. Senator after Senator has come to talk
about their concerns about energy costs. That is good. We should raise
awareness of this particular issue. But we need to do more than give a
speech, come up with a quick gimmick or a quick idea. We have to focus
on changing some fundamentals, and it ought to start with the Tax Code
and programs that help working families.
Mr. President, I have a friend in Illinois whose name is Harold
Ramis. Harold Ramis and I share a birth date and a lot of friends.
Harold Ramis has done quite well for himself. He ia a writer, a
producer of movies. Harold got started writing ``Animal House,'' went
on to write ``Caddyshack'' and a few others. But one of his most famous
movies, which he released over 15 years ago, was a movie called
``Groundhog Day.'' I bet every American has seen it. It is hard to
believe it has been more than 15 years since it was released. In that
movie another Chicagoan, Bill Murray, wakes up every morning in
Punxsutawney, PA, and looks over at the clock radio as Sonny and Cher
are singing ``I Got You, Babe,'' and relives the same day over and over
again, until finally it stops at the end. A fascinating movie, it has
been analyzed by so many people. What is the message of the movie? I am
not sure. I sure enjoy it and continue to watch it. I drive my wife
crazy when she says: How many times have you seen that movie? But I
like it a lot.
I am reminded of that movie when I think about what is going on in
the Senate. It is almost like ``Groundhog Day'' around here because
every day that you get up in the Senate and every week, it is the same
music playing. It is the same script playing. The script that is
playing is the strategy on the other side of the aisle, on the
Republican side of the aisle. Their strategy is very simple. It
involves the use of a filibuster.
A filibuster is a uniquely Senatorial institution that says,
historically, any Senator can stand up at any time and stop anything--a
nomination, a bill, anything. It gives us a lot of power. But
unfortunately, that power can be misused. ``Mr. Smith Goes to
Washington,'' Jimmy Stewart on that famous set, the brandnew Senator
who stood up and filibustered until he dropped right next to his desk,
we all remember that image. It doesn't quite happen that way anymore. I
have not seen anybody fall to the floor in the middle of a filibuster,
but it does eat up a lot of time, and it slows things down.
In the history of the Senate, there is a record book. The record book
says that in the history of this great body, in a 2-year period, the
maximum number of filibusters is 57; 57 times in 2 years there was an
effort to stop the debate, stop a nomination, and a filibuster was
initiated.
For those who follow the history of the Senate, they are watching a
historic session. Because in the last year and 4 months, the
Republicans in the Senate have broken the record. They have gone beyond
57 filibusters. At this point, they are now up to 68 Republican
filibusters and still counting. On 68 different occasions, they have
initiated a filibuster to stop us from taking up legislation.
You say to yourself: Maybe that had to be done. Not until you look at
the legislation involved. Two weeks ago, we had something called a
technical corrections bill. This is a bill that notices there were
spelling errors and grammar errors in a highway bill that passed
several years ago. They change it with technical corrections. It
usually is a bill which passes with no debate, no comment, and not even
a record vote. It just goes through when we have to clean up some
problems we had in previous legislation.
In this new era of Republican filibusters, they decided to filibuster
the technical corrections bill. If there was ever an embarrassing
moment in the history of the Senate, it is the notion that we would
filibuster a bill that corrects grammatical and spelling errors, but
they did it. They held the Senate in session for a full week while we
waited to complete the technical corrections bill. Then came the
veterans' health benefits bill. Veterans' health benefits? Is this an
issue anyone contests, that we would not provide all the benefits
promised and all we can afford to the men and women who have served our
country so valiantly and continue to? We brought this bill to the floor
figuring this was an easy one, a bipartisan bill. It would pass. It was
the subject of a Republican filibuster that held that bill on the floor
for a full week.
Time and again, we came to the floor and said to the Republicans: Let
us call up this bill. If you have an amendment, if there is something
you want to change, then let's do it. No. Day after weary day this
``Groundhog Day'' script played out. We got up every morning. We didn't
hear Sonny and Cher. We heard the Republican minority leader singing
the same song every morning: We are going to try to get around to
looking at this bill. Days passed.
If the Senate was paid for piecework as opposed to a general annual
salary, we would be hurting at this point. We don't do much around
here, and that is unfortunate. By the end of the week, after they had
burned another week off the calendar, a week where we didn't consider
the problems with our Nation's energy policy, where we didn't do a
thing about gasoline prices but were stuck in a Republican filibuster,
we had one vote on one amendment and passed the bill virtually
unanimously when it was all over.
There was no controversy.
The object from the Republican side: Slow everything down. Stop it if
you can.
[[Page S3681]]
So this week comes another bill. This bill is 288 pages. This is the
reauthorization of the Federal Aviation Administration. Unfortunately,
it is now subject to a Republican filibuster. A motion for cloture is
about to be filed. This week in the Senate, for those who want to keep
up with the ongoing and developing saga of our ``Groundhog Day''
script, Republicans are blocking safer, more efficient air travel. We
have spent the entire week here and had one vote. I know it is not a
secret. It is in the Congressional Record. But it is embarrassing. We
tried time and again to get Senate Republicans to give us an amendment,
call it up for a vote. Let's get moving on this bill. No, let's wait
until next week.
Is there anything else we could have been considering in the Senate
this week? We should have passed this in a hurry. First, it is a
bipartisan bill. Is it necessary or important? For those of us who live
on airplanes, you bet it is. Twenty-five million more passengers flew
on U.S. commercial air carriers last year than the previous year.
Almost 800 million passengers flew on U.S. commercial carriers in 2007,
double the number of 1985. The FAA predicts the aviation system will
transport more than 1 billion airline passengers annually by 2020.
There is a problem though. As modern as the airplanes may be, as new as
some of the airports may be, we are running our air traffic system on
radar that was established during World War II. This technology is not
equipped to handle the volume increase in air travel we anticipate. We
are already seeing it in airports across the country. Passengers are
feeling it in my home State in the great airport at O'Hare, where I
spend a large portion of my waking hours.
U.S. News and World Report placed O'Hare recently at the top of the
airport misery index. In defense of that great airport, we are in the
process of modernizing it and things will get better. But it is fat.
The magazine cited that almost 30 percent of flights in and out of
O'Hare are delayed. One of the main reasons is the incapacity of our
air traffic control system to deal with this increase in volume. We
need to move to a more modern, satellite-based air traffic control
system. This technology, known as NextGen, will give pilots and air
traffic controllers the ability to accurately pinpoint aircraft in the
sky to avoid any problems, to monitor traffic, to move things more
smoothly and efficiently.
The second reason for the increase in delays comes from the lack of
capacity in our airports. O'Hare Airport was designed in the 1950s and
built in that era. It doesn't handle, as it should most efficiently,
the aircraft of today. We have a big expansion under way. But the bill
that has been held up all week in the Senate, a bill that was brought
to us on a bipartisan basis by Senator Jay Rockefeller of West
Virginia, who has worked his heart out to pass this bill, and Senator
Kay Bailey Hutchison of Texas, who helped in crafting this bill, will
provide funding for programs to give airports the money they need to
expand and handle the growth in air traffic.
Lastly, the FAA bill also provides important provisions giving
passengers rights when they are stuck in airplanes on the tarmac. Has
it ever happened to you--stuck out there for an hour, if you are lucky?
It used to be a lot longer. There are some horror stories that have
come out of this. I will not go into the details other than to tell you
we try to provide in this bill basic protections for airline
passengers. We never want an airline to hurry into a circumstance that
might compromise safety, but we do believe they should inform their
passengers about what is going on and be mindful of the need for basic
human comforts that passengers need when they are stuck on the runway
for hour after weary hour. That is in this bill. You will not get a
chance, if you look at the Congressional Record of this week, to hear
any debate about it. We did not get to it. We were stuck in a
filibuster--stuck for I think it will be the 69th filibuster of this
senatorial session.
I believed when I came here that this was the world's greatest
deliberative body. Maybe it is self-promotion for us to continue to say
that because we have precious few amendments, very little debate, and
we really lack the kind of legislative activity that has, I guess, been
the hallmark of the Senate for as long as it has existed. We have
ground to a halt because we are facing the slowdown strategy from the
other side of the aisle.
When you think about how many important issues we need to work on for
this country, for the families of this country, important decisions we
need to make, it is sad that the Senate rules allow this to continue.
Well, we will return next Tuesday, after a long weekend. After having
one vote this week, we need a rest. I hope you understand. We will come
back Tuesday in the hopes we can start up this bill again. Maybe in the
second week this bipartisan bill just might draw an amendment from the
other side of the aisle, just might draw some debate on the floor, and
just might get passed, so we can move on to the next issue, which I
believe will be energy policy. And I can just guarantee you, it is
likely to face another filibuster from the Republican side of the
aisle.
The GOP is the, I guess, nickname for the Republican Party. It stands
for the ``Grand Old Party.'' When you watch the progress, or at least
the strategy of the Republicans in the Senate, you come to believe that
GOP stands for ``Graveyard Of Progress.'' That is what they see the
Senate. That is unfortunate.
There is a lot of work we need to do. The American people sent us
here to do it on a bipartisan basis. I hope we can get it done.
I yield the floor.
Several Senators addressed the Chair.
The PRESIDING OFFICER. The Senator from Rhode Island.
Mr. REED. Mr. President, the custom is to alternate to each side.
Senator DeMint is here. After he has concluded his remarks, I ask
unanimous consent to be recognized.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. DeMINT. Mr. President, I thank the Senator.
Mr. President, I need to start by expressing my disappointment at the
misleading and distorted information that was just presented on the
floor. Actually, I was amazed at what was just said.
The Commerce Committee had come up with an aviation modernization
bill with strong bipartisan support. But, like many other bills we have
faced with our Democratic colleagues in the majority, some of my
Democratic colleagues chose to add special provisions for some interest
groups and very wasteful and questionable earmarks, tax earmarks, using
unprecedented methods to fund things through changing our Tax Code,
things that there is a lot of consternation about: changing a pension
plan.
The reason this bill has been held up is the majority decided to add
things to it that had nothing to do with aviation. We want this bill to
come through, and it has strong support.
Mr. DURBIN. Mr. President, will the Senator yield for a question?
Mr. DeMINT. Mr. President, no, I will not. I have been down here
several times today, and I will continue my remarks. But I will be glad
to have the Senator say anything after I complete my remarks.
The Senator mentioned the technical corrections bill for
transportation. He said this was just typos. This bill added hundreds
of millions of dollars of new earmarks to our transportation budget. It
was not a technical correction bill. It was an opportunity for the
majority and some others to add things that did not need to be a part
of this bill. The Senator even knows, on bills such as consumer product
safety where special provisions were added for manufacturers in that
bill, we had to slow the bill down in order to get those things taken
out.
So there is a reason the majority has not been able to move any
significant legislation. It is because they tend to clutter it up with
wasteful special interest earmarks that need to be taken out.
Hopefully, we can come to an agreement to take out these unnecessary
and unprecedented tax provisions in our aviation modernization bill so
we can get this thing done.
Health Care
Mr. President, I did not come down to talk about aviation
modernization, as I hope the majority will clean this bill up so we can
get it through. But I want to talk a little bit about health care.
[[Page S3682]]
Health care is a priority for the Nation. Americans deserve access to
affordable health insurance. Yet we are wasting time here and not doing
anything to help with the health care crisis in this country today.
Fortunately, one of our colleagues, John McCain, has come out this
week strongly for a health care plan that would help every American to
be insured. He talks about guaranteed access to health insurance--plans
people can own and can afford and keep, plans they choose for
themselves and that are not chosen by the Government. This is the
direction we need to move.
Unfortunately, my Democratic colleagues--at least many of them--do
not want everyone to be insured with personal health insurance
policies. They would much rather the Government take over the whole
health insurance industry and decide for us what type of health plans
we are going to have. The evidence of this is abundant.
There are a number of efforts Republicans have made to try to improve
access to private health insurance. One is to allow people in this
country to buy health insurance from anywhere in the country. Right
now, they are restricted to buying it in the State where they live. So
a few insurance companies have a monopoly on the business. We have had
a Health Care Choice Act that would give Americans a chance to shop
anywhere in the country. Yet the Democrats have blocked this bill.
Only a couple weeks ago, we had an amendment to the budget bill that
would allow individuals to deduct the cost of health insurance, just as
businesses do. But I believe every Democrat in the Senate voted against
that, to give some kind of fair tax treatment to individuals who are
buying health care. They blocked it. Yet they complain about
individuals being uninsured. They do everything they can to keep
individuals from owning health insurance.
Now the Democrats are trying to destroy health savings accounts. It
started in the House with a bill that will change the way health
savings accounts are set up. The fastest growing way for the uninsured
to get insurance is new types of health plans that have health savings
accounts and insurance, where people can buy most of their health care
with their own dollars or in dollars their employers put in this health
savings account that is tax free. It gives them a lot more choices and
flexibility, and it takes out, importantly, the cost of third-party
administration.
Health savings accounts are a way to restructure health insurance
plans so that every time you go to the doctor or the hospital, there is
not a third-party insurance company filing claims or dealing with
billing and running up the cost of administration. We know today there
are more administrative people in a doctor's office or a hospital than
there are health care providers. The reason for that is, every time we
use the health care system, there is a third party involved, whether it
is private health insurance or Medicaid or Medicare, and there are a
lot of administrative costs.
Health savings accounts not only give people more flexibility, but
they begin to take the cost of administration out of health care. It
allows an individual to make their own decisions with their doctors or
with their pharmacists as to their health care, and they do not need
approval from some health insurance company or from some Government
bureaucrat whether they are going to spend this money. Certainly, the
way health savings account dollars are spent is restricted to real
health care, and that is the way it is working.
But, unfortunately, a company that provides this service of
substantiating the way health care dollars are spent has come to
Washington and convinced Democrats that we need a third party to
determine whether a health savings account spending event can be
substantiated. This is definitely a special interest provision that the
Democrats have bought into. But what it does is it adds the
administrative costs back to health savings accounts and takes away the
flexibility we are giving to individuals.
Keep in mind, people who are uninsured and people who did not have
insurance before and a number of people who are switching from
traditional plans--and we have gone from 1 million people covered by
health savings account-type plans to over 6 million in the last few
years. It is the fastest growing type of health care plan because that
is the kind of plan people want.
Let me just read some statistics. The reason for all this is the
Democrats have inserted, on the House side, in the bill they call the
Taxpayer Assistance and Simplification Act, provisions that would put
an administrative burden on health savings accounts. They are trying to
kill health savings accounts so we will all end up with Government
health care.
I already mentioned that we have gone from 1 million people covered
by health savings account plans in 2005 to over 6 million today.
Thirty-one percent of the people who have these health savings account
plans plus insurance were previously uninsured. Eighty-four percent of
health savings account policies in the group and individual market
provide first-dollar coverage for preventative care. So this claim that
health savings accounts keep people from seeking preventative care is
totally bogus because the plans are designed that when someone seeks
preventative care, diagnostic care, the insurance pays for it and it
does not come out of the health savings account.
Health savings accounts give people better access to the type of
health care they want. We found that it even helps with chronic-disease
management. If people have access to $1,000 or $2,000 more per year to
use the way they need to for their own health, then they can manage
their diabetes or congestive heart failure or other types of illnesses
that are often restricted by traditional health insurance.
I want to encourage my colleagues--my colleagues who really believe
Americans should have the freedom to own their own health insurance and
not have to go to the Government for their health care--to help us
preserve and promote and expand health savings accounts for those who
want them.
I want to make it clear, health savings accounts are health
insurance. They are just health insurance plans that have savings and
insurance with them, so that most of health care can be accessed with
dollars of patients doing direct business with their physician, with
their pharmacist, with the hospital. It will save millions--even
billions--as a nation in administrative costs. Already, Americans have
well over $3 billion saved in health savings accounts for future health
care needs.
This is an idea we need to expand across the country, not to destroy.
I would ask particularly my Democratic colleagues on the Senate side
not to take up this provision that the House included that will hurt
and probably destroy the whole idea of health savings accounts.
Mr. President, I thank the Senator for allowing me to speak, and I
yield back the time.
The PRESIDING OFFICER. The Senator from Rhode Island.
Mr. REED. Mr. President, we are here today in the midst of another
filibuster in which the FAA reauthorization bill is before us, but we
have to wait for a cloture vote and we have to wait many, many days
past, I think, what was appropriate. But it does give us an opportunity
to talk about the issue that is of most concern to Americans at this
moment; that is, the economy.
We have an economy that is heading, unfortunately, toward recession.
Some economists have already declared it here. Over the last few
months, I have spoken about the situation and particularly, I say to
the Presiding Officer, in our home State of Rhode Island where, as we
go about, we are stopped constantly by our constituents, our neighbors,
our friends who, quite rightly, complain about the current economic
situation.
The Senator from Illinois was very accurate and very insightful when
he noted that the incomes of most Americans have not risen over the
last decade or more and that these individuals--and we are not talking
about low-income Americans, entry-level workers; we are talking about
going way up close to $100,000 or more--they have seen no real income
growth. But what they have seen is accelerating prices.
Now, for several years, they thought they would be buttressed against
these
[[Page S3683]]
accelerating prices and slow income growth by the value of their homes.
But, as we know now, we are seeing a huge recession in the real estate
market. The values of homes are beginning to fall. They certainly are
not rising as they were. The foreclosure situation is deepening
everywhere. Again, in Rhode Island, there were traditionally a few
notices each week in the paper. Now it seems there is a whole section
devoted to foreclosures in the Providence Journal. It is evidence of
the worsening of the economic situation.
Now, the pressure of flat wages, flat incomes, housing values
falling--these accelerating prices are becoming very difficult to
endure by Americans everywhere.
According to a review, a recent survey by the Pew Research Center,
fewer Americans now than at any time in the past half century believe
they are moving forward in life.
One of the great aspects of my youth in the 1950s, 1960s, and 1970s
is not only did families deal with moving forward, they also were of an
unshakeable belief that their children would have a much better life
than they enjoyed. That belief is being shaken today, seriously. Many
parents--again, we are not talking about low-income workers; we are
talking about a range of Americans--believe that unless we take
positive and effective action, we are going to be in a situation where
the next generation of Americans will have it even more difficult than
we do today. That is why it is very difficult to bear these filibusters
because ultimately, this is not about parliamentary maneuvering. It is
about whether we can provide the leadership and the policies to reverse
course in America today and provide for that better future for our sons
and daughters tomorrow.
Seventy-nine percent of Americans today believe it is more difficult
to maintain their middle-class standard of living. In fact, one of the
great hallmarks of this country in the last century was the creation
and the expansion of the middle class. Again, there are many people who
are sensing that the middle class is not expanding any longer, but that
it is shrinking. It is shrinking on the load of increasing prices, flat
incomes, and decelerating housing values. That is not just the sum of
statistics and analysis and reports; that is what people are talking
about everywhere in this country.
In Rhode Island, for example, with respect to prices, the average
price of gasoline is soaring to record levels. Regular unleaded is
currently at more than $3.60 per gallon. Diesel is getting close to
$4.50 per gallon. For our trucking industry, for all of the businesses
that depend on moving their goods around, for the service people who
have to get to their service calls, when prices go up--gasoline and
diesel--that is an additional business cost. It is an additional tax on
them because of, I think, the failed policies of this administration,
and it is a tax that is taking a big bite out of their well-being and
the welfare of their families.
One thing we can do, and I think we should do--we could do it
immediately--is we can refrain, at least temporarily, from filling the
Strategic Petroleum Reserve. That seems to be a very simpleminded
approach to lessening, at least in a small way, demand for oil at a
time that oil is surging to around $119 per barrel. I think it also
will send a signal that we are at least doing something to relieve the
pressure on working families, and that can be done with the signature
by the President and ordered by the President, and it should be.
At the same time families across this country and businesses across
this country are seeing extraordinary price increases, oil companies
are seeing extraordinary profits. I think we have to take action, and
that action, once again, stalled on the Senate floor several months ago
to eliminate some of the tax breaks that oil companies are receiving. I
thought that at $119 a barrel, there would be sufficient incentives to
go drill, but apparently the oil companies need tax incentives as well.
I thought the market would be working in this case, but apparently it
works in strange ways for these oil companies.
I think we also have to think about a windfall profits tax. We have
huge expenditures. The President, as the Senator from Illinois pointed
out, is sending up a supplemental appropriations bill for Iraq for
billions of dollars. All of that is expended, and yet we can't tax some
of the extraordinary profits of companies that are doing very well and
don't seem to be reinvesting it robustly in drilling or searching for
alternative sources.
I think we also have to protect consumers from price gouging at the
pump, and something else--and that is speculation in the world oil
markets. There are experts who suggest that more than 25 percent of the
cost of crude oil may be the result not of supply and demand but of
market speculation. We need to give the principal regulator for the
energy-commodities markets, the Commodities Futures Trading Commission,
the tools they need to review these transactions and to ferret out
unscrupulous conduct in speculation.
That is why I support the Close the Enron Loophole Act that has been
introduced by Senator Levin. It has been included in the Senate-passed
farm bill, and I continue to advocate that provision should be adopted
very quickly because without it, I don't think we can effectively
provide regulation to a market that is exacting, in some estimates, a
25-percent premium, not because of supply and demand but because there
are financial forces at work speculating in these commodities, and that
speculation will go on until we authorize the appropriate regulatory
authority to begin to supervise, regulate, and review those
transactions.
The price of food is also, in many cases, spinning out of control for
so many working Americans. Since March 2007, the price of eggs has
jumped 35 percent, a gallon of milk is up 23 percent, a loaf of white
bread has gone up 16 percent, and a pound of ground chuck is up 8
percent. Overall, food prices in 2008 are expected to rise 4 to 5
percent, about double the increase of recent years.
Again, this is not just an economic statistic. Talk to the bakers--
and the Presiding Officer knows these families, such as the Calise
family and other families in Rhode Island who have been baking
Italian bread for 70 or 100 years--they have never seen the increase in
wheat prices they have seen over the last several months. It is
affecting their ability to make ends meet for their businesses. When
you have accelerating energy prices, oil prices, gasoline prices,
accelerating commodity prices such as wheat, a business such as that, a
family-owned bakery, it is very difficult. It is extremely difficult
for those families who are struggling to get by to get, frankly, to the
supermarket, fill up their basket, and not walk out very much
impoverished by the experience.
That is why I have requested the Senate Agriculture Committee to hold
a hearing on the food versus fuel balance in U.S. agriculture policy.
We have been encouraging ethanol production. That would bar us using
some of our commodities, our agricultural commodities, but I believe we
have to begin to focus on the tradeoff between energy production and
food production.
I have also sent a letter to the Agriculture Secretary expressing
concern with the cost of wheat, as I indicated, based upon comments I
received from our bakers in Rhode Island, and requested that the
Secretary work with the Environmental Protection Agency and the
Department of Energy to look at the need to develop a mechanism to
balance this tradeoff between food production and fuel production, and
requesting information about how the Department of Agriculture is
managing the wheat stockpile--which is something that will influence
the price of wheat--as well as requesting information on how it is
monitoring new speculative investment in commodities and its impact on
prices. All of this has to be done.
What is becoming also more difficult to bear on top of everything we
have talked about--flat income, rising prices, declining home values--
is the fact that now we are seeing unemployment begin to accelerate. In
Rhode Island, we are unfortunately experiencing a 6.1-percent
unemployment rate--higher than the rest of New England. It is causing
real problems, and it is something we have to address. I think we have
to begin to recognize that as we lose jobs, we have to think seriously
about employing people again.
As I mentioned, Rhode Island has a 6.1 percent unemployment rate
right
[[Page S3684]]
now. It is close to the highest unemployment rate in the United States,
only behind Michigan, Alaska, and California. It is the highest
unemployment rate in Rhode Island since August of 1995, more than 12
years ago. There are 35,100 people in Rhode Island who are unemployed,
and this is a trend that has been going up, unfortunately, not down.
We have also seen a shift in employment recently from February to
March of 2008. In just a single month, 3,100 less people were without
jobs in Rhode Island, a decrease in 3,100 jobs. For a State with a
population of just 1 million, that is a significant factor. It adds not
only to the decline in the unemployment, but the velocity of that
decline. Things seem to be trending much quicker downward than
rebounding.
Now, it is no wonder that the Labor Department announced today that
the number of first-time claims for unemployment benefits rose to
380,000 nationwide. That is the highest level in 4 years. Today's
announcement concluded that Rhode Island had one of the largest
increases in initial claims numbering 1,779. The direction is
unfortunate, and it is the wrong direction. Approximately half of those
unemployed workers were eligible to collect unemployment insurance
benefits, and of this number, nearly 19 percent face long-term
unemployment.
The number of Rhode Islanders in 2008 who continue to collect
unemployment benefits has also increased--14.1 percent above the number
of the same period last year. As a result of this situation of
deteriorating employment and longer term unemployment, a significant
number of Rhode Islanders are exhausting their benefits. They are
receiving their final payment. That has occurred for more than 1,900
people, and that percentage is increasing also.
All of these numbers suggest something very obvious: more and more
people need unemployment insurance. More and more people are on
unemployment longer. The economy is not responding to their needs. This
economy is not generating jobs, it is shredding jobs. That ultimately
leads to the fact that the benefits run out if we do not extend
unemployment insurance benefits.
Now, I think that is something we have to do. I think we have an
obligation in this economy--which is getting worse, not better--to go
ahead and provide extended unemployment benefits. By the way, these
benefits are one of the best stimulus programs we have because the
proportion of the money that is expended that gets reinvested quickly--
respent in the economy--is significantly higher than other programs.
I was pleased the Senate passed and the President signed into law the
Economic Stimulus Act in February. I voted for this package. It will
provide tax rebate checks. They are on their way out to many families
across the country. But given the historically high unemployment in
Rhode Island and in other parts of the country, I believe we need to do
much more. This is a national problem. It needs attention. That is why
I believe we have to extend unemployment benefits. In those States that
are hit hard by this economic crisis, individuals should be eligible
for benefits for an additional 13 weeks and another 13 weeks of
emergency benefits in States where the unemployment rate is
exceptionally high.
I pressed, as so many did, for inclusion of these extended
unemployment insurance benefits last February, and I commend my
colleagues who have fought also for this benefit, including Senators
Kennedy and Durbin and Stabenow.
As I indicated, many economists have also pointed to the extent of
unemployment benefits as not only something that helps the individual,
but it provides further stimulus for our economy. An extension of these
benefits provides a very high rate of return on the money expended,
generating approximately $1.64 in gross domestic product per dollar
invested in this program. This is especially helpful when we are
looking for ways to get the economy moving again.
We get news each day of declining economic statistics. The last
notice of our gross domestic product for the last quarter was a very
unimpressive .6 percent. We need urgent action to move the economy. We
need urgent action to help families who are struggling. They have
worked. They have worked hard, and they are running out of their
benefits. We can't run out on them.
That is why we need an economic stimulus package that will not only
recognize obligations overseas, but we will recognize obligations at
home. I hope we will enact a very robust extension of unemployment
benefits for all Americans.
Mr. President, I yield the floor.
The PRESIDING OFFICER. The Senator from Kansas is recognized.
Ethanol
Mr. BROWNBACK. Mr. President, I appreciate hearing my colleague from
Rhode Island. I am standing here thinking: Thank goodness we have
ethanol. Without ethanol--we are supplying 8 percent of our fuel
needs--it would drive up gasoline prices another 15 percent. I am
certainly pleased we have that.
We had a hearing in the Joint Economic Committee today on the price
of corn and its impact on food prices. It is interesting from the
standpoint that economists are putting it in front of us that a 40-
percent increase in corn prices would only lead to a 1.3-percent
increase in the price of food, and that is because corn goes into a
whole bunch of different substances. Thankfully, with the corn-based
ethanol we have, we are holding gasoline prices down approximately 15
percent.
A Merrill Lynch analyst estimated oil and gasoline prices would be 15
percent higher, or $4.14 a gallon at today's prices, if biofuel
producers weren't increasing their output. That is significant in this
marketplace. Thankfully, we have that.
I also note that on wheat prices something is significant in Kansas.
We have had a fall of $4 a bushel in the price of wheat since January,
from $12 a bushel to $8 a bushel. Plus, in a loaf of bread, you
probably have 10 cents' worth of wheat. I hope they would say the farm
is not the problem in the system.
Our oil prices are high and we need to hold them down. Part of the
answer to that is domestic production--more oil and gas production in
the United States but also biofuels. That is not the reason I came to
the floor to speak. It was a good use of time to be able to put that in
the Record, though, because we are going to debate, apparently, the
role of biofuels in the economy and around the world. I wanted to note
it has a positive impact.
Mr. President, I will speak on the FAA reauthorization bill. I thank
the chairman and ranking member of the relevant committees for bringing
to the floor a balanced FAA reauthorization bill. It takes into account
the needs of the air traffic control system and pays for them and
distributes that in a fair manner.
I am not pleased we are not able to move the bill forward. I wish it
wasn't loaded up with extraneous provisions but, rather, that it would
stay with the FAA.
I am particularly happy to see the bill contains no user fees for the
general aviation industry. It would have placed an inordinate burden on
what has been and continues to be a thriving American industry, a true
domestic manufacturing success story. I might note to people here and
those watching, we are recruiting for jobs. We need people in this
industry. We have a number of manufacturing jobs in my State. I have
traveled around and they are saying we need more people coming in to
work. Some in Hays, KS, were telling me they need a thousand people for
jobs they have.
The aircraft industry is recruiting individuals and, hopefully, we
can keep that moving forward with a good FAA reauthorization bill. I
think it helps the industry further if you don't put a tax on the
industry; it will hurt it. This is a domestic industry, and we need to
take care of it.
Importantly, however, this bill provides for the needed upgrade of
our Nation's air traffic control system, which has been outdated for
many years and the technology is outpaced by many countries around the
world. That should not be the case.
Aviation and manufacturing are very important to my State. We have
five major aviation companies located there, including Cessna, Hawker
Beechcraft, Bombardier Learjet, Spirit AeroSystems, and Boeing
Integrated Defense Systems.
The aviation industry has a huge ripple effect. Every manufacturing
job
[[Page S3685]]
created adds 2.9 other jobs. It is a vibrant industry that, for the
first time this past year, exported more of its product than it sold
domestically. This is the first time we have been able to do that.
However, I wish to note some disturbing trends on things I think we
need to attack so we don't lose this domestic industry. This is one
that a lot of people in the world are trying to get a big piece of.
Honda is coming into the aviation manufacturing sector, and others are
coming into it. It has high-paying manufacturing jobs of a key product
used around the world.
In 1985, the United States produced 80 percent of the world's new
aircraft. This past year, that number was down to 60 percent--from 80
to 60 percent. There is increasing competition, and I hope we can
address this trend as we move forward. To that end, I intend to offer
an amendment to the bill that would create a blue-ribbon commission of
experts in aviation manufacturing to study the current trends in the
industry and recommend ways in which we, as a Government, can respond
to those trends and ensure the vibrancy of this important commercial
sector.
Parenthetically, one of the things we should not be doing is
exporting our aviation defense jobs--such as sending the major tanker
contract to Europe and to Airbus, rather than having it done in the
United States. This is a major battle that will engulf this Congress--
whether that $40 billion contract, that the base plane should be an
Airbus plane, made primarily in Europe, or if the base plane should be
a plane primarily made in the United States. It is a key part of the
long-term trends of this industry, and we are already losing a lot of
that, even as the industry continues to do well and is exporting well.
We are not maintaining the market share we have had internationally
because the Europeans, through government subsidies, are buying into
this, and other countries are following as well.
I think as we look for what can help support our overall exports in
our economy, aircraft sales can continue to be that. Presently, they
provide a $56 billion trade surplus for our country. We sold $76
billion in airplanes and parts to foreign buyers. I think we need to
watch and I think we need to be very aggressive to protect and see that
this industry grows. One of the needed things is the FAA
reauthorization program. We need a modern air traffic control system,
and we need to have a fee structure that doesn't penalize general
aviation.
There is one final note. One of my colleagues from Missouri is
talking about bringing up an amendment that I think would have some
positive impact on a repair and maintenance program but would have in
it some features--if it continues in the way I have seen it--that could
harm our aviation industry domestically. If that amendment comes up, we
are going to look very critically at it, with the possibility of
putting forward second-degree amendments to make sure we don't
unintentionally harm the domestic U.S. aviation industry.
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. NELSON of Florida. Mr. President, I ask unanimous consent that
the order for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Military Housing
Mr. NELSON of Florida. Mr. President, there is a colossal waste of
taxpayers' money that is occurring at Patrick Air Force Base in the
State of Florida near my home of Melbourne, FL. Happily, the Senate
Armed Services Committee has addressed the issue to try to expose the
spotlight on the problem to get the U.S. Air Force to come clean as to
what has happened in this huge fiasco of waste of taxpayers' money.
It is born out of the privatization of housing for military families.
Throughout the country, there has been some success at other military
bases, but on a particular contractor, a contractor who got the
contract to build housing for the Air Force on four Air Force bases,
including Patrick Air Force Base and three others in other places such
as Georgia and Arkansas, the contractor went belly up and now, in order
to try to keep some semblance of housing being built, what is happening
is the Air Force now wants to use all of the land that is supposed to
be for housing at Patrick Air Force Base as the equity to build the
houses on the other bases in three other States.
You will be surprised when I tell you how bad this is. There were 300
acres on the barrier island south of Patrick Air Force Base. This is in
the town of Satellite Beach in Florida. It is near Cape Canaveral and
the Cape Canaveral Air Force station. The 300 acres were basically
given by the Air Force to a joint venture, a corporation, that included
this developer that ultimately went bust. The deal was so bad that the
Air Force agrees, of the 300 acres, they are going to outright give 100
acres to the developer. The developer goes off and sells it for
something like $13 million or $15 million and pockets the cash. On the
remaining 200 acres the developer is supposed to build 550 new homes
for airmen and their families and commensurately tear down the old
dilapidated housing that had been there for several decades.
The developer only builds 163 houses and then stops, and all these
other old dwellings are there, of which the developer has the authority
to rent on the market, and since they are run down, almost slum-like
conditions, you can imagine the kind of tenants you are now getting
living next to Air Force families.
The Air Force's idea of rescuing this is to say we are going to take
that remaining 200 acres, we are going to give it to a new developer,
and that equity is going to help that developer build additional
houses, but not at Patrick, no, in these three other States.
So Patrick Air Force Base and our Air Force families who thought they
were going to get 550 new homes now only have 163 homes sitting next to
slum dwellings, and the Air Force is going to give away the rest of
this 200 acres?
Well, something smells awfully fishy. Fortunately, this has come to
this Senator's attention. I am happy to say I had to strain and grunt a
little bit to get my point of view across to the Senate Armed Services
Committee yesterday in a markup, but when the test came on a recorded
vote, it was 22 to 0 in favor of the amendment that would require the
Air Force to do a cost-benefit study before they can transfer the
property. That is the policy set forth in the Defense authorization
bill.
I want to say a word to the U.S. Air Force: No, technically, you
don't have to pay attention because legally you can go on and transfer
that property now because our Defense authorization bill is not law. It
has only been passed out of the Senate Armed Services Committee. But it
is going to be law once it gets through the House and the Senate and
goes to the President for signature.
I strongly suggest to the U.S. Air Force, and I am memorializing
these comments in a letter to the Secretary of the Air Force, Secretary
Wynne: Withhold, forbear on any transfer of the title to a new
developer utilizing that very valuable asset of barrier island,
oceanfront land until you do the cost-benefit analysis so we can bring
this out into the full light of day and we will know how we can best
protect the taxpayers' investment.
We want to serve the U.S. airmen and their families, we want to serve
the U.S. taxpayers and their families, and the best way to do that is
get this story out in the open with this cost-benefit analysis.
Mr. President, I yield the floor.
The PRESIDING OFFICER (Mr. Nelson of Florida). The distinguished
Senator from Vermont is recognized.
Energy
Mr. SANDERS. Mr. President, in the last several weeks in a number of
venues, I have met with hundreds, in fact thousands, of Vermonters, and
to nobody's great surprise, the issue that is uppermost on their minds
is the very high price of gas and the price of oil. I know that is true
in all 50 States in this country and in thousands of communities. It is
especially true in rural States because in rural States, especially
cold-weather States, it is not uncommon for people to travel 50 miles
to their jobs and then 50 miles back. If you drive 100 miles to work,
the mileage runs up.
I should mention, I know it probably didn't snow in Florida, but it
did snow
[[Page S3686]]
in Vermont. We had a small amount of snow. That simply indicates that
people know when it gets cold in Vermont it gets very cold. We have a
lot of elderly people right now wondering how they are going to heat
their homes next winter. We have a combination of working people in a
rural State--this is true all over rural America--paying outrageously
high prices in order to get to work and, in colder weather States,
people very worried about whether they can stay warm next winter.
The arithmetic is not really hard to figure out. If you put 25,000
miles on your car going to work every year and you are paying a buck
more than you used to and you get 25 miles per gallon on your car, that
is a thousand dollars. If you make $30,000 a year and you get a 3-
percent raise, that is 900 bucks. So all of your raise, all of your
cost-of-living increase on your job is now in your gas tank. That is
happening to millions of American workers. Then these same workers are
paying more for health care, are paying more for food, more for
education, which, added together, is why the middle class in America is
collapsing.
For many years, as good-paying jobs have gone to China, as our people
are struggling to make ends meet, people have been worried about how
they are going to survive economically. On top of that, we now have the
foreclosure crisis and we have the escalating cost of gas and oil in
this country, which then leads some 80 percent of the people in this
country to believe this country is going in the wrong direction, and
one wonders, really, what the other 20 percent are thinking. Clearly,
for the middle class in this country, we are facing a very serious
problem.
I did an interesting thing a few weeks ago in Vermont. We were having
some town meetings on the economy. We brought a professor from Harvard
Law School, one of the best writers in America on the economy. Her name
is Elizabeth Warren.
In preparation for that meeting, we sent out an e-mail to people in
my State and said: Tell me what is going on in terms of the collapse of
the middle class and how that impacts your life. Frankly, we expected a
few dozen people to reply. As of today, we have received over 700
responses. This is doubly surprising because in Vermont people are
quite reticent, not wanting to talk about personal aspects of their
lives--700 people. I recommend you and Members of the Senate read some
of these responses. They are up on our Web site. The tales people are
telling are heartbreaking, they are poignant, they come from the heart,
and there are hundreds of them.
Let me just read a few segments of some of the letters we have
received and how they touch on gas prices and the general collapse of
the middle class in our country.
We are hard-working people. We want to pay our bills. We
want to keep what we worked so hard for. The constantly
increasing cost of gas, oil, groceries are drowning us. I
hear the same thing from most of our friends on a daily
basis--hanging on by a thread, robbing Peter to pay Paul. It
is such a stressful way to live. There are days when I get so
discouraged I just want to call the banks and say just take
it all. I don't have it in me to fight for it anymore.
This is a family in the State of Vermont.
Here is another one. This comes from an elderly couple in Vermont:
My wife and I are both 77, retired and living on a very
limited income. We live in the country, and driving the 60-
plus miles round trip for shopping and health care has become
a financial hardship.
Traveling 60 miles for shopping and health care has become a
financial hardship.
Even though we drive a car that gets 35 miles to the
gallon, a tankful of gas eats up an awfully large amount of
our disposable income.
That is true all over America. You have older people who
get in their car, they go out to buy groceries, they go to
the doctor, and suddenly they are finding that just getting
into their car and going where they have gone their whole
lives is now a very expensive proposition, in this case
eating up a large part of their disposable income.
Another family writes:
I live in the Northeast Kingdom, which is a very rural area
in the northern part of Vermont near the Canadian border, and
I have to drive a 30-mile round trip to work in Morrisville
and even farther to Stowe, where most of the jobs are now.
With the gas prices high and most employers paying $8.50 to
maybe $10 per hour, you spend much of your paycheck traveling
to and from work.
In other words, in the real world, there are millions of people in
rural Vermont and all over this country and in Florida who are making
$8.50, $9, $10 an hour, and if you are paying $3.50 a gallon to get to
work and you have to travel any kind of distance, what do you have
left? Not a lot.
The average price for a gallon of gas recently hit a recordbreaking
$3.62 a gallon, which is more than double what it was when President
Bush first took office. The price of diesel fuel is now averaging over
$4.17 a gallon, which is more than $1.36 higher than it was just a year
ago. The price of oil is now $110 a barrel. I think these prices say it
all. They tell every Member or should tell every Member of Congress
what the American people understand, which is that we have a national
emergency on our hands. If we do not act boldly and rapidly to lower
gas and oil prices, the economic situation for millions of working
families will only deteriorate even further.
What we are talking about is not just the worker who can't afford to
fill up his gas tank, it is the entire economy. It is small businesses,
it is farmers, it is truckers. The trucking industry is convoluting
right now with these high prices. It is the increased cost of
groceries, it is tourism. People come to Vermont and people go to
Florida to enjoy vacations. They are not going to be able to drive
there with these prices. In fact, what we are looking at is a major
economic crisis impacting every segment of our economy.
Sadly, as in so many other areas regarding the needs of ordinary
Americans, when it comes to gas prices the Bush-Cheney administration
is just not there. This is an administration where, in area after area,
you can count on them to stand up with the large multinational
corporations. You can count on them protecting the wealthiest people in
the country. Now, when the middle class is in crisis, when people
cannot afford the rapidly rising costs of gas and oil, they are nowhere
to be found.
What is particularly interesting, of course, as most people know, is
both President Bush and Vice President Cheney have backgrounds in the
oil industry. That is what they did before they assumed the Presidency
and Vice Presidency.
Ironically--and this would really be almost funny if it weren't so
sad--when President Bush ran for office in the year 2000, he touted his
experience in oil as one of the reasons he should be elected President.
He knew the oil industry. He would make the energy situation better
based on his experience.
Here is a direct quote from what candidate Bush said in the year
2000, in his first campaign, regarding how he would improve our
relations with some of the OPEC countries. This is what he said:
I will use the capital that my administration will earn
with the Kuwaitis or the Saudis and convince them to open the
spigot.
That is what candidate George Bush said in the year 2000.
Then he said, also in that campaign:
The President of the United States must jawbone OPEC
Members to lower the price.
End of quote from candidate George Bush in the year 2000. That was 8
years ago. When then-candidate Bush made those comments, the price of
oil was $30 a barrel. Today, after 7\1/2\ years of the Bush-Cheney
administration, the price of oil is now $110 a barrel.
It seems to me that it is imperative that among many other things,
many other actions Congress must take, one of them is to do what
President Bush talked about in 2000 but never did, and that is we must
demand that Saudi Arabia and Kuwait produce the kind of oil they can.
We must also move forward as a Congress to address the reality that
OPEC is a cartel. That is their reason for existence. A cartel is
formed in collusion in order, in this case, to prevent production of
oil, control the production of oil in order to artificially keep prices
high.
This Congress must demand two things: that Saudi Arabia and Kuwait
and other OPEC members increase their production so we can lower
prices, and second, we must be aggressive in telling the World Trade
Organization that OPEC is a cartel; it must be disbanded.
Back to President Bush.
In 2004, when Saudi Arabia led the fight within OPEC to cut
production
[[Page S3687]]
and raise prices, the Miami Herald reported that President Bush
``refused to lean on the oil cartel'' and ``refused to even personally
lobby OPEC leaders to change their minds.''
It is true that last January President Bush did visit Saudi Arabia to
ask OPEC nations to increase production, but guess what. The Associated
Press reported that President Bush's request was ``ignored.''
In 2000, as a candidate, he told us he was going to open the spigot,
he was going to get them to produce more oil, but that, of course, has
not happened.
Last March, after meeting with Saudi Arabia's oil minister, the Wall
Street Journal reported that ``Vice President Dick Cheney suggested
there is little more Saudi Arabia can do to increase oil production and
relieve price pressures in global markets.'' But Stephen Brown, the
energy economist at the Federal Reserve, has disputed this. He has said
that ``Saudi Arabia is restraining its production, probably by about
1.8 million barrels a day. And OPEC is probably holding back 2.3
million barrels a day altogether.'' In other words, despite all of the
rhetoric from President Bush, all of his experience in the oil
industry, the reality is that Saudi Arabia is not producing the kind of
oil it should be producing and we are hurting as a result of that.
Many of us are tired of waiting for the Bush administration to act.
Congress must act. There are a number of things we must do in order to
lower the price of gas and oil in this country. One of them is to
demand that Saudi Arabia, Kuwait, and the other OPEC countries start
producing the quantity of oil we know they can produce.
That is one thing we can do, but it is certainly not enough. The
national oil emergency we currently face in our country and in many
other countries demands both short-term and long-term solutions.
Long term, I think many people in the Senate and the vast majority of
the American people understand that we must break our dependency on
fossil fuel. We must move to energy efficiency. We must move to such
sustainable energies as wind, solar, geothermal, biomass, and others.
In my view, the potential is absolutely staggering in terms of the
amount of energy we can produce through sustainable energy and the
amount of energy we can save through energy efficiency.
Not only that, obviously we need to significantly improve public
transportation. Our railroads today lag far behind Europe and Japan. In
doing that, building a broad mass-transportation system, we can break
our dependency on the automobile.
In terms of automobiles, people are just now beginning--and we must
help them--to move to electric cars, move to hybrid plug-in cars. There
is just enormous potential out there. Clearly, that is the long-term
solution of where we have to go.
But I sometimes hear my friends coming here and they talk about a
long-term solution and yet they forget about what is going on in
America today for a family making $30,000 or $40,000 a year, and maybe
they have two cars because they have two workers, and those people are
going broke today.
So I do not think it is an either/or. I think we have got to be
aggressive right now in moving toward energy efficiency and sustainable
energy, but we have also got to be aggressive today in lowering the
price of gas and oil. It is not an either/or. We move forward in
parallel tracks.
One of the steps we have to take is to put pressure on OPEC nations
to increase the production of oil. I think also we have got to break up
OPEC, and let the free market work in that area. But that is only one
of the things we have got to do.
Second, I believe it is absolutely imperative that we impose a
windfall profits tax on the oil and gas industry. The American people
do not understand, nor do I understand, why they are paying record-
breaking prices at the gas pump, while ExxonMobil has made more in
profits than any corporation in the history of the world for the past 2
consecutive years.
I know ExxonMobil and their propaganda machine will no doubt explain
it. But the average person does not believe it and the average person
should not believe it. ExxonMobil and the other major oil companies are
ripping off the American people. That is clear. We need a windfall
profits tax to address that.
Last year alone, ExxonMobil made $40 billion in profits, and rewarded
its CEO Rex Tillerson with a $21 million compensation package. That is
nothing. He is getting shortchanged, because the guy who went before
him, when he retired--his name was Lee Raymond--got a $400 million
retirement package. So my suggestion to Mr. Tillerson is: Go back to
your board. You are getting ripped off 21 million bucks. How are you
going to make it on that?
Here you have a company charging record-breaking prices, having given
its former CEO a few years ago $400 million in a retirement package.
But ExxonMobil is not alone. Chevron, ConocoPhillips, Shell, and BP
have also been making out like bandits. In fact, the five largest oil
companies in this country have made over $600 billion in profits since
George W. Bush has been President. Not bad, $600 billion in profits in
7.5 years. And people in Vermont and Florida cannot afford to fill
their gas tanks.
Last year alone, the major oil companies in the United States made
over $155 billion in profits and, not surprisingly, those profits
continue to soar. Today, ExxonMobil reported a 17-percent increase in
profits, totaling $10.9 billion, $10.9 billion for one quarter.
Earlier this week, however, BP, British Petroleum, announced a 63-
percent increase in their profits. Shell's first quarter profits jumped
by 25 percent to over $9 billion; one quarter, 3 months.
ConocoPhillips' profits increased by over 16 percent in the first
quarter to over $4 billion.
It is hard to come up with the words to describe it, because I know,
and I am sure you know, Mr. President, the problems middle-class people
are facing today and what these high oil and gas prices are meaning to
families, and at the same time this is going on, these major oil
companies are enjoying obscene levels of profit. With their profits,
among many other things, they are very lavish in the kind of benefits
and salaries they provide their CEOs. Last year, Occidental Petroleum,
one of the ``smaller'' companies, gave its CEO $34.2 million in total
compensation. The CEO of Anadarko Petroleum received $26 million.
Chevron's CEO made $15 million, as did ConocoPhillips' CEO. He made
$15.1 million in compensation.
Let me be clear. I believe oil companies should be allowed to make a
reasonable profit and CEOs of big oil companies should enjoy decent
compensation. That is a tough job and they should earn a good salary.
But they should not be allowed to rip off the American people at the
gas pump, especially at this moment in our history when the middle
class is stressed out and in many ways collapsing.
The time has come to impose a windfall oil tax on those companies so
they cannot continue to gouge the ordinary people of our country.
Unfortunately, however, imposing a windfall profits tax on big oil will
not be easy. I think we all know the reason, and that is, since 1998
the oil and gas industry has spent over $616 million on lobbyists.
And dare I say that right now on the floors of the Senate, and on the
floors of the House, you have very well paid lobbyists, former
congressional leaders, big-time law firms, floating all over this place
right now trying to convince Members of the House and the Senate to
leave big oil alone. Not only have they spent, since 1998, $616 million
on lobbying; since 1990 they have spent over $213 million in campaign
contributions. That is the way the world goes--lobby, campaign
contributions from powerful multinational corporations.
What is the end result? Their profits are soaring and ordinary
Americans are hurting. The time has come, it seems to me, for the
Senate to stand with working families all over this country, to have
the courage to stand up to this very powerful industry and say ``yes''
to a windfall profits tax and ``no'' to the continued urges of the oil
and gas industry to pat them on the back and do nothing.
While it is true that oil companies and their executives are making
money hand over fist, it is also true they are not the only culprits in
this situation. We must begin focusing on the very powerful speculators
and hedge fund managers who have also been making obscene sums of money
by speculating
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on futures and driving an unregulated market up and up and up.
There are some people who estimate, in fact, that half of the
increase in oil costs is attributable to the cost of production but to
the speculation that takes place.
In my view, Congress must act to rein in greedy speculators by
closing what has been referred to as the Enron loophole and increasing
oversight over the energy futures industry.
The Enron loophole was created in 2000 as part of the Commodity
Futures Modernization Act. At the behest of Enron lobbyists, a
provision in this bill was inserted in the dark of night and with no
congressional hearings. Specifically, the Enron loophole exempts
electronic energy trading from Federal commodities laws. Virtually
overnight, the loophole freed over-the-counter energy trading from
Federal oversight requirements, opening the door to excessive
speculation and energy price manipulation. Since the Enron loophole has
been in effect, crude oil prices jumped from $33 a barrel in 2000,
after adjusting for inflation, to over $110 a barrel today.
Last January, a veteran oil analyst at Oppenheimer estimated there is
as much as a $57 a barrel ``speculative premium'' on the price of oil.
In other words, he estimates that about half of the price of a barrel
of oil is due not to the production and distribution of that product
but simply to speculation.
The CEO of Marathon Oil said late last year that $100 oil is not
justified by the physical demand in the market. In other words, those
guys see that the price of oil is being driven up by speculation.
Closing the Enron loophole would subject electronic energy markets to
proper regulatory oversight by the Commodity Futures Trading Commission
to prevent price manipulation and excessive speculation.
I thank Senators Levin and Feinstein. I know Senator Dorgan and
others have been involved in producing legislation and ideas to close
this loophole. We must move forward and pass that type of legislation
as soon as possible.
In addition--and this is an issue where there appears to be a degree
of bipartisan support--some of our Republican friends also agree the
Bush administration must stop the flow of oil into the Strategic
Petroleum Reserve, and in my view, my view, immediately release oil
from this Federal stockpile to reduce gas prices.
This action has been taken in the past. It is not a new idea. Goldman
Sachs has estimated that continuing to fill the Strategic Petroleum
Reserve has increased gas prices at the pump by as much as 25 cents a
gallon, and that clearly is unacceptable.
Releasing oil from the Strategic Petroleum Reserve in the past, under
both Democratic and Republican administrations has, in fact, lowered
the price of gas and crude oil. For example, when President Clinton
ordered the release of 30 million barrels from the SPR in 2000, the
price of gas fell by 14 cents a gallon in 2 weeks.
When President George H.W. Bush, the first President Bush, released
13 million barrels of crude oil from the SPR in 1991, crude oil prices
dropped by over $10 per barrel.
Let me conclude by saying that the issue we are dealing with today,
in my view, is not only the high price of gas and oil. As serious as
that is, and as much impact as that is having on our economy, the
deeper issue here is the degree to which people in our country, the
hard-working citizens of our country, will or will not continue to have
faith that their Government represents them.
It is no secret that President Bush will likely go down in history as
perhaps the least popular President and, in my view, one of the worst
Presidents we have ever had. But it is also true that the ratings of
this Congress are extraordinarily low; they are even lower than where
President Bush is.
I think the reason for that is people are suffering terrible problems
right now. In almost every area you can think of, this country is going
in the wrong direction. The middle class is hurting. We talked about
oil prices, food prices, the loss of good-paying jobs, the health care
system, Social Security falling apart, people are paying 25, 30 percent
interest rates on credit cards. People are in trouble. In a Democratic
society, when people are in trouble, they look to the people whom they
elected, to their Government, to protect their interests. They are
looking to Washington right now. They are looking here. They are
hurting, and they are asking whether the Congress of the United States
has the courage to stand up to the very powerful financial interests
which have so much influence over what goes on here.
So I hope very much we have the courage to once again earn the
confidence of the American people, that we understand the pain they are
feeling, and that we act properly, that we lower gas prices, that we
lower oil prices.
We can do this with bold action, and we can move this country to a
new energy policy dealing with energy efficiency and sustainable
energy. I think the American people want us to do that. I think that
is, in fact, what we should do.
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. REID. I ask unanimous consent that the order for the quorum call
be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. REID. Mr. President, it is really difficult for me to comprehend
the reasoning of my friends on the other side of the aisle. All week we
have done nothing. One of the most important bills that has been
brought before this body this year, the Federal Aviation Administration
reauthorization, as we speak there are thousands of airplanes going all
across the United States. The equipment that allows those airplanes to
take off and land is antiquated and way out of line for making air
travel in America as safe as it should be. This legislation is very
important and would be good for America, good for passengers.
We have in this legislation the passengers bill of rights, money to
replace antiquated equipment. But the Republicans have stopped us from
legislating. We have tried virtually everything.
I wanted to have an orderly process, which I think is not
unreasonable. So last night I said: We have filled the different trees
to allow amendments, but if you want to offer one, come on. No.
I said: Well, give us a list of the amendments you want to offer. No.
They said: Bunning has an amendment. Let us see it. That went on all
day yesterday. Finally, they told us today the subject matter of that
particular amendment. When I learned about the subject matter, I said
fine. It is something about coal being changed so they can use the fuel
for flying airplanes. No.
I said: I will tell you what we will do. We will take down the tree.
You can offer anything you want. No.
We heard what they didn't like were provisions that would allow rail
service in this country to be updated and modernized. They didn't want
that. There was some language in the bill that would do something to
help make highway safety paramount. Don't want that. Offer an amendment
to take it out. No.
Finally, I came to the conclusion that their objection was to a
provision contained in the President's budget. I couldn't make up a
story that is more ridiculous than the one I am relating, which is the
truth. There is a provision in this bill that gives the State of New
York the final amount of $20 billion that was promised them after 9/11
by President Bush. That amount of money is in his budget for this year,
which he gave us. I talked to the distinguished Republican leader and
said: Offer an amendment to take it out. This is in the President's
budget. We still oppose it, is what I was told.
So it is obvious. The Republicans don't want to do anything to
improve, to modernize the Federal Aviation Administration. I hope
people who are within the sound of my voice think about that when they
are flying across the country.
We are not going to be able to do it this year, more than likely.
There will be room made in the schedule by the Republicans to take up
$170-odd billion for funding the war in Iraq from now until a year from
this June. With glad hands, they will all come to the Senate floor and
spend more money in Iraq. I
[[Page S3689]]
guess they don't want to pull the plug on spending $5,000 every second.
Maybe they are trying to up the ante. I will have more to say about
this tomorrow, but it is really a disappointment.
This is not a victory for the Republicans to maintain the status quo,
is it? Of course not. Would it be a big victory for the Democrats to
pass the Federal aviation reauthorization? No. It would be something
good for the American people. I hope the American public sees this for
what it is. We Democrats are in the majority. It is a slim majority. It
is 51 to 49. The Republicans obviously are upset over the fact that we
are in the majority. They want the record to show that this Congress
accomplished nothing.
In spite of the obstacles and their obstruction, we have still
accomplished quite a few things. We are proud of what we have
accomplished, considering all the hoops we had to go through to get
where we did.
I never give up hope. I hope there will be a new day in Washington
starting next week. One way we can have a new day: We give all the
blame to the Republicans in the Senate. They certainly are the ones who
are on the firing lines. But do you know how much it would mean if the
man down at 1600 Pennsylvania Avenue would call the Republican leader
and say our country needs this FAA reauthorization? We need it. The
President could call down here and break this logjam, as he could have
done on all the other legislation they have stopped. How in the world
do these people go to bed at night not worrying about the air traffic
system falling apart, because it is going to. It is in desperate shape.
Out in this parking lot there are new automobiles that have GPS
systems in them. That is better equipment than the FAA has moving all
the airplanes around the country.
Cloture Motions
I send a cloture motion to the desk to the substitute amendment No.
4627.
The PRESIDING OFFICER. The cloture motion having been presented under
rule XXII, the Chair directs the clerk to read the motion.
The legislative clerk read as follows:
Cloture Motion
We, the undersigned Senators, in accordance with the
provisions of rule XXII of the Standing Rules of the Senate,
hereby move to bring to a close debate on the substitute
amendment No. 4627 to H.R. 2881, the FAA reauthorization.
Harry Reid, John D. Rockefeller IV, Barbara Boxer, Kent
Conrad, Patrick J. Leahy, Robert P. Casey, Jr., Mark L.
Pryor, Sherrod Brown, Patty Murray, Ken Salazar, Max
Baucus, Thomas R. Carper, Amy Klobuchar, Sheldon
Whitehouse, E. Benjamin Nelson, Richard Durbin, Blanche
L. Lincoln, Daniel K. Inouye.
Mr. REID. I now send to the desk a cloture motion on the bill.
The PRESIDING OFFICER. The cloture motion having been presented under
rule XXII, the Chair directs the clerk to read the motion.
The legislative clerk read as follows:
Cloture Motion
We, the undersigned Senators, in accordance with the
provisions of rule XXII of the Standing Rules of the Senate,
hereby move to bring to a close debate on H.R. 2881, the FAA
reauthorization.
Harry Reid, John D. Rockefeller IV, Barbara Boxer, Kent
Conrad, Patrick J. Leahy, Robert P. Casey, Jr., Mark L.
Pryor, Sherrod Brown, Patty Murray, Ken Salazar, Max
Baucus, Thomas R. Carper, Amy Klobuchar, Sheldon
Whitehouse, Blanche L. Lincoln, E. Benjamin Nelson,
Richard Durbin, Daniel K. Inouye.
Mr. REID. Mr. President, I ask unanimous consent that the cloture
vote on the substitute amendment No. 4627 occur at 2:30 p.m., Tuesday,
May 6; further, that the mandatory quorums for both motions be waived.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. REID. 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.
Ms. CANTWELL. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER (Mr. Sanders). Without objection, it is so
ordered.
Ms. CANTWELL. Mr. President, are we in morning business?
The PRESIDING OFFICER. We are not.
____________________