[Congressional Record Volume 154, Number 120 (Tuesday, July 22, 2008)]
[Senate]
[Pages S6985-S6997]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




    STOP EXCESSIVE ENERGY SPECULATION ACT OF 2008--MOTION TO PROCEED

  The ACTING PRESIDENT pro tempore. Under the previous order, the 
Senate will resume consideration of the motion to proceed to S. 3268, 
which the clerk will report by title.
  The assistant legislative clerk read as follows:

       Motion to proceed to the bill (S. 3268) to amend the 
     Commodity Exchange Act to prevent excessive price speculation 
     with respect to energy commodities, and for other purposes.

  The ACTING PRESIDENT pro tempore. Under the previous order, there 
will be 1 hour of debate, equally divided and controlled between the 
two leaders or their designees prior to the vote on the motion to 
invoke cloture.
  The Senator from New Mexico.
  Mr. BINGAMAN. Mr. President, later this morning, we are scheduled to 
vote on the motion to proceed to the legislation that the majority 
leader was referring to. This legislation is entitled the Stop 
Excessive Energy Speculation Act of 2008. This is legislation that is 
designed to shed additional light on trading activities in global oil 
markets.
  I hope very much the Senate will vote to invoke cloture this morning 
and that we can proceed, and do so in a bipartisan fashion, to debate 
the legislation. The topic of speculative investment in our energy 
markets has been the subject of many hearings throughout many 
committees of the Senate.
  In our own committee, the Senate Energy and Natural Resources 
Committee that I chair, along with a handful of other committees, we 
have had something approaching 30 or 40 hearings during the 110th 
Congress on this subject. We have heard testimony from industry 
analysts, traditional producers and consumers of petroleum products, 
that the recent runup in crude prices can be attributed, at least in 
part--and there is debate about whether it is 20 percent or more or 
less, but this runup in prices can be attributed, at least in part, to 
what are referred to by some of the experts as the ``new fundamentals'' 
in our energy markets.
  We had Dan Yergin, from Cambridge Energy Associates, who testified at 
a workshop we had in the Energy and Natural Resources Committee last 
week, and he talked about the new fundamentals, as he has now for some 
time. These new fundamental forces include nontraditional investment 
flows into energy commodity markets, as asset managers seek to hedge 
against inflationary risks and hedge against the decline in the value 
of the dollar.
  This flight of investments into commodities is a symptom of our 
ailing economy in general. But it also poses a number of serious 
questions from an energy market perspective. Among those are whether 
and how the influx of billions of dollars in relatively passive 
investment is impacting the fundamental price-discovery functions these 
financial markets are intended to perform; that is to say, to some 
pension fund managers and index investors taking positions in the oil 
markets, the price of a barrel of oil on any given day may not be very 
important. Whether the price is $5 or $500 per barrel, their oil market 
positions are designed to balance the risk they have in other parts of 
their portfolio, and they have made a policy judgment to put 10 percent 
of their portfolio in commodity markets, the oil market being prime 
among those.
  So the question for policymakers is whether this investment--this new 
fundamental: the demand for paper barrels, as it was referred to at our 
workshop last week--has begun to swamp the price signals that are 
generated by the more traditional hedgers, the large producers, and 
consumers of petroleum products in tune to the real-time dynamics of 
supply and demand. Supply and demand is still a significant factor in 
the price of oil. There is no question about that. But these new 
fundamentals are also a significant factor in the view of many experts 
who have testified to our committee.
  During the course of the multiple hearings we have held in the Energy 
Committee, through a series of related correspondence we have had with 
the Commodity Futures Trading Commission, and in the ensuing debate in 
the Senate, I believe that a compelling case has been made that the 
Commodity Futures Trading Commission requires more authority, needs 
more authority, needs more resources, needs more explicit direction 
from Congress to examine these issues in detail.

  That is what Senator Reid's legislation tries to accomplish. Senator 
Reid's legislation would provide the CFTC, the Commodity Futures 
Trading Commission, with the tools to do that. It does several things. 
Let me mention a few.
  It codifies recent CFTC initiatives related to the conditions under 
which the United States will allow traders access to foreign boards of 
trade on which energy commodity contracts are listed. That is an 
important signal to the market that the United States will take a 
stronger stand on efforts to circumvent domestic trading rules.
  The second thing it does is it provides much greater transparency in 
over-the-counter markets. This is another key building block to putting 
in place forward-leaning regulatory policies adapted to the 
increasingly global and electronic environment in which energy is 
bought and sold.
  The third thing this legislation does is it includes a number of 
provisions designed to shine additional light on the nexus, or 
connection, between the physical commodity and the financial energy 
markets, and to ask some of the same questions about natural gas 
markets that we have been asking about petroleum over the last few 
months. I believe this is an important effort. Particularly it is an 
important effort in light of what may prove to be a very difficult 
winter heating season.
  There are clearly ways in which this underlying legislation can be 
improved

[[Page S6986]]

if we have the bipartisan will to do so. In addition, I know some on 
the other side of the aisle would like to expand the debate on the 
energy speculation bill to address, in addition, supply and demand-
related issues. I believe Senator Reid has indicated an openness to 
having that done as well, if we can come together on a plan for 
consideration of amendments.
  It is clear to me there is indeed more we can do on the topic of 
curtailing demand and expediting the availability of domestic supply in 
the United States. I hope we can offer proposals along these lines in 
the days ahead. Hopefully, we can find some areas of commonality on 
those measures as well.
  The first step toward getting to this serious debate--which I think 
we all believe should occur--the first step to achieving consensus in 
the Senate is to invoke cloture this morning on the motion to proceed 
to the energy speculation bill that Senator Reid has brought forward.
  I urge my colleagues to do so.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Texas.
  Mr. CORNYN. Mr. President, I thank the distinguished chairman of the 
Senate Energy Committee, who is very knowledgable on this subject. I do 
say to him that I do believe that I and others on this side of the 
aisle will vote to invoke cloture on the speculation provision. But I 
do have some questions about it.
  First of all, I asked the majority leader how much of the problem of 
the high price of oil was caused by speculation. He said some people 
say 20 percent. I cited to him Warren Buffett, a multibillionaire, 
somebody who knows a lot about financing, and he said he thought it was 
supply and demand. T. Boone Pickens, one of my constituents, who has 
made a lot of waves here recently, talking about the importance of wind 
energy and talking about the importance of natural gas, said that 
focusing on speculation is a waste of time.
  Now, I do not know whether it is a waste of time or whether it is 20 
percent. But I would ask the majority leader, why are we only going to 
focus--assuming you are right and speculation is 20 percent of the 
problem--why are we only going to focus on a 20-percent solution? Why 
not focus on the 80 percent he is leaving on the table by not talking 
about supply and demand?
  Of course, while Congress continues to not do things that might have 
an impact, we have seen, since January 4, 2007--since the Democratic 
majority took power--the price of gasoline, which was $2.33 a gallon, 
today has dropped just a little bit, dropped a nickel, to $4.06 a 
gallon.
  Here is what Warren Buffet, the chairman and CEO of Berkshire-
Hathaway, told us:

       It's not speculation, it is supply and demand.

  I am not saying this, but let's say somebody would say he is wrong 
and Senator Reid is right, it is 20 percent. How come we are not 
talking about that remaining 80 percent? That, frankly, is what our 
side of the aisle would like to talk about. We would like to talk about 
a 100-percent solution, assuming that is humanly possible.
  I was in Texas this weekend. Yesterday I hosted a press conference at 
the Flying J truckstop on I-35 in Waco, TX. I must tell you, all I hear 
from my constituents back home is how the high price of gasoline is not 
only pinching their budget but making it harder for them to get by.
  I also went to the North Texas Food Bank in Dallas. Of course I 
talked to a lot of the volunteers and other staff there who are doing 
great work providing food for people who are hungry. What they are 
telling me is that the high price of fuel is increasing the cost of 
food. Using ethanol, using corn for fuel, is causing additional 
pressure on food prices. We are finding that not only are people 
suffering more at the pump when they go to fill up their tank, actually 
they are finding it harder to put food on the table, putting more and 
more pressure on charitable organizations such as the North Texas Food 
Bank.
  Try as we might, there is one law that we simply can no longer refuse 
to acknowledge, and that is the law of supply and demand. We know world 
demand is going up because rising economies such as China and India, 
countries of more than 1 billion people each, want more of what we 
have. They want to be able to buy cars, they want to be able to drive 
those cars, they want the prosperity that comes with access to energy 
that we in America have had pretty much to ourselves for a long time.
  It is important for Congress to realize the one power we do have, 
frankly, is the power to lift the moratorium on the 85 percent of the 
Outer Continental Shelf where we know there are vast supplies of oil 
and natural gas. For every barrel of oil that we produce in America, 
that is one barrel less we have to buy from the Middle East, including 
OPEC, the Organization of Petroleum Exporting Countries, which includes 
countries such as Iran, or from countries such as Venezuela, from Hugo 
Chavez, someone who obviously does not wish us well.
  We know there are ways to come up with new sources. Unfortunately, 
every time we bring up new energy sources to try to bring down the 
price of oil by producing more supply at home we are told we cannot do 
that; that is, offshore exploration was blocked, oil shale was blocked, 
which reportedly accounts for about 2 million additional barrels of oil 
that we can produce in America, in Colorado, Utah, and Wyoming. ANWR, a 
2,000-acre postage stamp in a huge expanse of land in the Arctic that 
could produce as many as 1 million barrels of oil a day, that is 
blocked.
  It does not just stop there. We say we need to do something about 
rising electricity costs as well, so why can't we build some nuclear 
powerplants? We have been told we cannot do that either; that is 
blocked.
  Why can't we figure a way to use the coal we have in America? We have 
been called the Saudi Arabia of coal. The problem is, coal is dirty. 
But we have the technology, we have the know-how, I believe, using good 
old-fashioned American ingenuity and our world class institutions of 
higher education to do the research, to learn how to use it cleanly. 
Clean coal research and technology--that has been blocked as well.
  Increasingly, it sounds as though either we are engaged in a 
nonsolution, if you believe Mr. Buffet--and the majority leader is 
going to confine us simply to a speculation provision--or, at best, 
according to the majority leader's own words, we are only going to be 
dealing with 20 percent of the problem. I think we ought to deal with 
100 percent of the problem. Unfortunately, it seems as though every 
time we bring up the issue of more domestic supply, our friends on the 
other side of the aisle, who control the floor and control the agenda 
by virtue of their being in the majority, have simply said: No. No.
  Unfortunately, no new energy continues to mean higher prices for the 
American consumer.
  On this side of the aisle we have introduced a bill that has the 
support of 46 Republicans. We skinnied it down to try to eliminate 
controversial issues, and we said: Let's look at the speculation 
component. Let's look at greater transparency. Let's look at putting 
more cops on the beat, more human resources to make sure we supervise 
and we analyze and we make sure we police the commodity futures market 
for abuses. But we don't just stop there. We don't stop with a 20-
percent solution. We provide a comprehensive solution by saying yes to 
domestic oil supply, using what God has given us in this country in a 
way that will allow us to be less dependent on imported oil from the 
Middle East.
  As we continue to do that--and this is the other component of the gas 
price reduction bill I am referring to, that has 46 cosponsors--we say 
let's continue to do the research on renewable and alternative fuels 
because one day it may well be that we are all driving battery-powered 
cars that we literally plug into the wall socket at night to charge 
those batteries. That is what the major car companies are going to be 
introducing into the marketplace in 2010.
  As we continue to do research in wind energy or solar to generate 
electricity, we continue to do research into how to use coal to 
transform it into liquid so we can turn it into aviation fuel. Believe 
it or not, that is what the U.S. Air Force is doing right now. It is 
flying some of its most sophisticated airplanes using synthetic fuel 
made

[[Page S6987]]

from coal, coal to liquid. The challenge we have, of course, is to try 
to make sure we can sequester the carbon dioxide produced from that.
  I don't know why every time we try to find more and we try to talk 
about the importance of conservation that our Democratic friends, 
including the majority leader, just simply say no. Why they would offer 
either a nonsolution or a 20-percent solution, depending on whether you 
want to believe T. Boone Pickens or you want to believe the majority 
leader--T. Boone Pickens, who said just addressing speculation is a 
waste of time; Warren Buffet, who said it is not speculation but supply 
and demand that is the problem. But let's say the majority leader is 
right, and both of them are wrong. At best we have a 20-percent 
solution. I think America needs better than that.
  The strange thing about it is I don't know why we would resist going 
onto this bill and offering amendments that would provide a 100-percent 
solution to America's energy problems. Find more and use less is the 
formula we would like to see enacted in this legislation.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from North Dakota.
  Mr. DORGAN. Mr. President, it is fascinating to come out here and 
listen to false choices. Let me describe this issue of find more, drill 
more. I am for drilling. I am for everything. But that is yesterday 
forever. It is the same folks who every 10 years show up and say: Let's 
keep doing what we have been doing, that sure is good, except the hole 
keeps getting deeper. If we don't have something that is game changing, 
10 years from now they will be back talking about ``find more.''
  The false choice is this: This chart shows the National Petroleum 
Reserve Alaska. We have made all 23 million acres of it available for 
drilling. Only 3.8 million acres have been leased. There is more oil in 
the National Petroleum Reserve Alaska than exists in ANWR. An estimated 
9 million barrels of oil and 60 trillion cubic feet of natural gas are 
available in the National Petroleum Reserve Alaska. Yet some 
policymakers trot out their little horn ornament called ANWR and say: 
You have to agree to drill in ANWR or you are not for drilling.
  How about this? How about this 23 million acres? It is a canard and 
false choice to come out and suggest that somehow, as my colleague 
said, Democrats are against drilling. That is absurd. It is just not 
the case.
  What we need to be for, it seems to me, is something that is game 
changing, something that says let's not be in this same position 10 
years from now. John F. Kennedy didn't say let's try to go to the Moon 
or I would like to think about going to the Moon or maybe we will make 
an effort to go to the Moon. He said: We are going to put a man on the 
Moon by the end of a decade.
  That is what we ought to do with respect to the change in energy 
policy. You will get no change from those who come to the floor of the 
Senate and say let's keep doing what we have been doing even though the 
hole is getting deeper.
  Here is what is happening. We need to do first things first. The 
first hurdle in front of us is to shut down the dramatic speculation on 
the oil futures market. Speculators were 37 percent of the people in 
the oil futures market in the year 2000. Now oil speculators are 71 
percent of the market. They have broken the market. There is nothing my 
colleagues can point to in the last 12 months that happened in supply 
and demand that would justify a doubling of the price of oil--nothing. 
Yet, interestingly enough, 47 Members of the other side of the aisle 
have said speculation is at least part of the problem. In fact, there 
is a provision on speculation in the bill of Senator McConnell, the 
minority leader's bill that was offered in the Senate.
  If 47 of them believe speculation is part of the problem, let's at 
least address that first. It seems to me if you are running the 
hurdles, you jump the hurdles in front of you. Why not do this first, 
even as we work on a wide range of other issues as described by my 
colleague, Senator Bingaman? We are drilling, and we should continue to 
drill in a responsible way in certain areas of the country.
  I was one of four Senators who helped open lease 181 in the Gulf of 
Mexico. It was a big fight. Guess what. It has been open now for a 
couple of years, and there is not one drilling rig on it because the 
oil folks aren't there. Yet they send folks to the floor of the Senate 
to say we need to get Democrats to allow us to drill more. There are 8 
million acres we opened in the Gulf of Mexico. There is substantial new 
oil and gas available on those 8 million acres. Yet they are not there 
drilling. Why?
  The entire master narrative in this debate in the Senate is the 
minority wanting to say somehow the majority doesn't support drilling. 
It is a false choice, and they know it.
  The question is this: Will they support shutting down the excessive 
relentless speculation in the oil futures markets? Will they support 
that? Are they going to stand on the side of the oil speculators and 
say we kind of like what is going on; we like seeing the price of oil 
double in a year?
  Let me point out again that there is nothing that has happened in 
supply and demand that would remotely justify the doubling of the price 
of oil in a year. Yet they come to the floor with their charts and say: 
Produce more.
  I am for producing more. It is a false choice to suggest they support 
producing more and we do not. But the question is, what are you going 
to do to deal with the problem today? Then, what are you going to do as 
we go forward to suggest something that is really game changing, that 
allows us to be free and escape from the need to rely on Saudis to ship 
us oil?
  My colleague just described a quote from T. Boone Pickens. He must 
have forgotten the quote from R. Boone Pickens that says: You can't 
drill your way out of this mess. You can't drill your way out of this. 
What we need to decide as a country is we are not going to have to go 
begging for oil from the Saudis, from Venezuela, Iraq, and elsewhere 
because we have changed our energy mix.
  So if 47 members of the minority have talked about speculation being 
a problem, perhaps we can at least address this first issue. Then we 
should work on the wide range of other things--substantial 
conservation; substantial new initiatives with respect to energy 
efficiency; yes, more production; and most important, dramatic moves 
toward renewable energy: wind energy, solar, geothermal, biomass.
  It is long past the time for this country to decide we are going to 
change our energy mix. How are you ever going to get to hydrogen fuel 
cell vehicles--or, in the interim, to electric vehicles--if you do not 
get serious about deciding we are going to change our energy future? If 
you want to be yesterday forever, God bless you, but don't count me 
among you. I don't want to be here 10 years from now--I don't know that 
I would be--but I don't want to be here every single decade to see the 
same folks coming to the Senate floor to say let's keep digging the 
same hole. How? Just because drilling is the only answer.
  Mr. President, how much time have I consumed?
  The ACTING PRESIDENT pro tempore. Six-and-a-half minutes.
  Mr. DORGAN. I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Michigan is 
recognized.
  Mr. LEVIN. Mr. President, day after day record-high oil and gasoline 
prices are hurting millions of American consumers and businesses. 
Unless we act, the record-high prices will continue to reverberate 
throughout our economy, increasing the prices of transportation, food, 
manufacturing and everything in between, endangering the economic 
security of our people and our Nation.
  The price of crude oil recently reached a record high price of about 
$147 per barrel. Sky-high crude oil prices have led to record highs in 
the price of other fuels produced from crude oil, including gasoline, 
heating oil, diesel fuel, and jet fuel. The national average price of 
gasoline is at a record high of about $4.11 per gallon. Jet fuel costs 
nearly $4.30 per gallon. The price of diesel fuel, which is normally 
less expensive than gasoline, has soared to a record high of nearly 
$4.85 per gallon.
  Rising energy prices greatly increase the cost of getting to work and 
taking our children to school, traveling by car, truck, air and rail, 
and growing the food we eat and transporting it to market. Rising 
energy prices greatly increase the cost of producing the

[[Page S6988]]

medicines we need for our health, heating our homes and offices, 
generating electricity, and manufacturing industrial and consumer 
products. The relentless increase in jet fuel prices has caused airline 
layoffs, fare increases, and service cuts. ``If fuel continues to go 
up, this industry cannot survive in current form,'' the president of 
the Air Transport Association said recently. Rising diesel prices have 
placed a crushing burden upon our Nation's truckers, farmers, 
manufacturers, and other industries.
  My Senate Permanent Subcommittee on Investigations has conducted four 
separate investigations into how our energy markets operate. Last 
December, we had a joint hearing with Senator Dorgan's Senate Energy 
Subcommittee on the role of speculation in rising energy prices. As a 
result of these investigations and hearings, I have proposed several 
measures to address the rampant speculation and lack of regulation of 
energy markets which have contributed to sky high energy prices.
  These investigations have shown that one key factor in price spikes 
of energy is increased speculation in the energy markets. Traders are 
trading contracts for future delivery of oil in record amounts, 
creating a demand for paper contracts that gets translated into 
increases in prices and increasing price volatility.
  Much of this increase in trading of futures has been due to 
speculation. Speculators in the oil market do not intend to use oil; 
instead they buy and sell contracts for crude oil in the hope of making 
a profit from changing prices. The number of futures and options 
contracts held by speculators has gone from around 100,000 contracts in 
2001, which was 20 percent of the total number of outstanding 
contracts, to almost 1.2 million contracts, which represents almost 40 
percent of the outstanding futures and options contracts in oil on 
NYMEX. Even this understates the increase in speculation, since the 
CFTC data classifies futures trading involving index funds as 
commercial trading rather than speculation.
  There are now, as a result, 12 times as many speculative holdings as 
there were in 2001, while holdings of non-speculative or commercial 
futures and options are up but 3 times. According to the basic law of 
supply and demand, the more demand there is to buy futures contracts 
for the delivery of a commodity, the higher the price will be for those 
futures contracts.
  Not surprisingly, therefore, this massive speculation that the price 
of oil will increase, together with the increase in the amount of 
purchases of futures contracts, has, in fact, helped increase the price 
of oil to a level far above the price that is justified by the 
traditional forces of supply and demand.
  The president and CEO of Marathon Oil recently said, ``$100 oil isn't 
justified by the physical demand in the market. It has to be 
speculation on the futures market that is fueling this.'' Mr. Fadel 
Gheit, oil analyst for Oppenheimer and Company describes the oil market 
as ``a farce.'' ``The speculators have seized control and it's 
basically a free-for-all, a global gambling hall, and it won't shut 
down unless and until responsible governments step in.'' In January of 
this year, as oil hit $100 a barrel, Mr. Tim Evans, oil analyst for 
Citigroup, wrote ``the larger supply and demand fundamentals do not 
support a further rise and are, in fact, more consistent with lower 
price levels.'' At the joint hearing on the effects of speculation we 
held last December, Dr. Edward Krapels, a financial market analyst, 
testified, ``Of course financial trading, speculation affects the price 
of oil because it affects the price of everything we trade . . . It 
would be amazing if oil somehow escaped this effect.'' Dr. Krapels 
added that as a result of this speculation, ``There is a bubble in oil 
prices.''
  The need to control speculation is urgent. The presidents and CEOs of 
major U.S. airlines recently warned about the disastrous effects of 
rampant speculation on the airline industry. The CEOs stated ``normal 
market forces are being dangerously amplified by poorly regulated 
market speculation.'' The CEOs wrote, ``For airlines, ultra-expensive 
fuel means thousands of lost jobs and severe reductions in air service 
to both large and small communities.''
  As to reining in speculation, the first step to take is to put a cop 
back on the beat in all our energy markets to prevent excessive 
speculation, price manipulation, and trading abuses. In the spring of 
2001, when my Senate Permanent Subcommittee on Investigations began 
investigating our energy markets, the price of a gallon of gasoline had 
spiked upwards by about 25 cents over the course of the Memorial Day 
holiday. We subpoenaed records from major oil companies and interviewed 
oil industry experts, gas station dealers, antitrust experts, gasoline 
wholesalers and distributors, and oil company executives. We examined 
thousands of prices at gas stations in Michigan, Ohio, California, and 
other States. In the spring of 2002, I released a 400-page report and 
held 2 days of hearings on the results of the investigation.
  The investigation found that increasing concentration in the gasoline 
refining industry, due to a large number of recent mergers and 
acquisitions, was one of the causes of the increasing number of 
gasoline price spikes. Another factor causing price spikes was the 
increasing tendency of refiners to keep lower inventories of gasoline. 
We also found a number of instances in which the increasing 
concentration in the refining industry was also leading to higher 
prices in general. Limitations on the pipeline that brings gasoline 
into my home State of Michigan were another cause of price increases 
and spikes in Michigan. The report recommended that the Federal Trade 
Commission carefully investigate proposed mergers, particularly with 
respect to the effect of mergers on inventories of gasoline.
  The investigation discovered one instance in which a major oil 
company was considering ways to prevent other refiners from supplying 
gasoline to the Midwest so that prices would increase.
  In March 2003, my subcommittee released a second report detailing how 
the operation of crude oil markets affects the price of not only 
gasoline, but also key commodities like home heating oil, jet fuel, and 
diesel fuel. The report warned that U.S. energy markets were vulnerable 
to price manipulation due to a lack of comprehensive regulation and 
market oversight.
  For years I have been working with Senators Feinstein, Dorgan, Snowe, 
Bingaman, Cantwell, and others on legislation to restore some 
regulatory authority in the energy markets that had been exempted from 
regulation because of an ``Enron loophole'' that was inserted at the 
last minute into an omnibus appropriation bill in December 2000. For 2 
years we attempted to close the Enron loophole, but efforts to put the 
cop back on the beat in these markets were unsuccessful, due to 
opposition from the Bush administration, large energy companies, and 
large financial institutions that trade energy commodities.
  In June 2006, I released another subcommittee report, ``The Role of 
Market Speculation in Rising Oil and Gas Prices: A Need to Put a Cop on 
the Beat.'' This report found that the traditional forces of supply and 
demand didn't account for sustained price increases and price 
volatility in the oil and gasoline markets. The report concluded that, 
in 2006, a growing number of trades of contracts for future delivery of 
oil occurred without regulatory oversight and that market speculation 
had contributed to rising oil and gasoline prices, perhaps accounting 
for $20 out of a then-priced $70 barrel of oil.
  That subcommittee report, again, recommended new laws to provide 
market oversight and stop excessive speculation and market 
manipulation. I coauthored legislation with Senators Feinstein, Snowe, 
Cantwell, Bingaman, and others to improve oversight of the unregulated 
energy markets. Once again, opposition from the Bush administration, 
large energy traders, and the financial industry prevented the full 
Senate from considering this legislation.
  In 2007, my subcommittee addressed the sharp rise in natural gas 
prices and released a fourth report, entitled ``Excessive Speculation 
in the Natural Gas Market.'' Our investigation showed that speculation 
by a single hedge fund named Amaranth had distorted natural gas prices 
during the summer of 2006, and drove up prices for average consumers. 
The report also demonstrated how Amaranth had shifted its speculative 
activity to unregulated markets to

[[Page S6989]]

avoid the restrictions and oversight in the regulated markets, and how 
Amaranth's trading in the unregulated markets contributed to price 
increases.
  Following this investigation, I introduced a new bill, S. 2058, to 
close the Enron loophole and regulate the unregulated electronic energy 
markets. Working again with Senators Feinstein and Snowe, and with the 
members of the Agriculture Committee in a bipartisan effort, we finally 
managed to include an amendment to close the Enron loophole in the farm 
bill that was then being considered by the Senate. Although the CFTC's 
new enforcement authority over these electronic markets was effective 
upon passage of this legislation, much of the CFTC's new oversight 
authority will have to be implemented through CFTC rulemaking.
  Although the legislation to close the Enron loophole is important to 
reduce speculation in energy markets, it is not sufficient because a 
significant amount of U.S. crude oil and gasoline trading now takes 
place in the United Kingdom, beyond the direct reach of U.S. 
regulators. So we have to address that second loophole too.
  One of the key energy commodity markets for U.S. crude oil and 
gasoline trading is now located in London, regulated by the British 
agency called the Financial Services Authority, FSA. However, the 
British regulators traditionally have not imposed any limits on 
speculation like we do here in the United States, and the British do 
not make public the same type of trading data that we do, i.e. it is 
less transparent. This means that traders can avoid the limits on 
speculation in crude oil imposed on the New York exchanges by trading 
on the London exchange. This is what is referred to as ``the London 
loophole.''
  The Stop Excessive Energy Speculation Act--Energy Speculation Act--
which the majority leader and others recently introduced to address 
high prices and reduce speculation, includes a number of provisions 
that will help stop rampant speculation and increase our access to 
timely and important trading information and ensure that there is 
adequate market oversight of the trading of U.S. energy commodities no 
matter where the trading occurs. One of the key provisions in the 
Energy Speculation Act would close the London loophole.
  The Energy Speculation Act would close the London loophole by 
requiring the Commodity Futures Trading Commission, CFTC, to determine 
whether a foreign exchange imposes comparable speculative limits and 
comparable reporting requirements on speculators that the CFTC imposes 
on U.S. exchanges prior to allowing traders in the U.S. trading U.S. 
energy commodities to access that exchange through a terminal located 
in this country. It would also give the CFTC authority to take action, 
such as by requiring traders to reduce their holdings, in the event 
that traders exceed these limits.
  The legislation in the Energy Speculation Act to close the London 
loophole is very similar to legislation I previously introduced with 
Senators Feinstein, Durbin, Dorgan and Bingaman, S. 3129, to close this 
loophole. The legislation we introduced was also incorporated into 
legislation introduced by Senator Durbin, S. 3130, which, like the 
provisions of the Energy Speculation Act, would give the CFTC more 
resources and to obtain better information about index trading and the 
swaps market.
  After these two bills were introduced, the CFTC imposed more 
stringent conditions upon the ICE Futures Exchange's ability to operate 
in the United States--for the first time insisting that the London 
exchange impose and enforce comparable position limits in order to be 
allowed to keep its trading terminals in the United States. This is the 
very action our legislation called for.
  Although the CFTC has taken these important steps that will go a long 
way towards closing the London loophole, Congress should still pass the 
legislation to make sure the London loophole is closed. The Energy 
Speculation Act would put into statute the conditions the CFTC has 
stated the London exchange must meet before it will allow it to operate 
its terminals in the United States, and it would ensure that the CFTC 
has clear authority to take action against any U.S. trader who is 
excessively speculating through the London exchange or manipulating the 
price of a commodity, including requiring that trader to reduce 
holdings.
  There is also concern that some large traders may be avoiding the 
limits on holdings and accountability levels that apply to trading on 
the regulated futures exchanges by trading in the unregulated OTC 
market. In the absence of data or reporting on the activity in the OTC 
market, however, it is difficult to estimate the impact of this large 
amount of unregulated trading on commodity prices. Moreover, even if we 
were to get better information about unregulated over-the-counter 
trades, the CFTC has no authority to take action to prevent excessive 
speculation or price manipulation resulting from this unregulated 
trading.
  The legislation to close the Enron loophole placed OTC electronic 
exchanges under CFTC regulation. However, this legislation did not 
address the separate issue of trading in the rest of the unregulated 
OTC market, which includes bilateral trades of swaps through voice 
brokers, swap dealers, and direct party-to-party negotiations.
  I recently introduced, along with Senator Feinstein, the Over-the-
Counter Speculation Act, legislation that addresses the rest of the OTC 
market, a large portion of which consists of the trading of swaps 
relating to the price of a commodity. Generally, commodity swaps are 
contracts between two parties where one party pays a fixed price to 
another party in return for some type of payment at a future time 
depending on the price of a commodity. Because some of these swap 
instruments look very much like futures contracts--except that they do 
not call for the actual delivery of the commodity--there is concern 
that the price of these swaps that are traded in the unregulated OTC 
market could affect the price of the very similar futures contracts 
that are traded on the regulated futures markets. We don't yet know for 
sure that this is the case, or that it is not, because we don't have 
any data or reporting on the trading of these swaps in the OTC market.
  The Energy Speculation Act introduced by the Majority Leader and 
others includes this legislation to give the CFTC oversight authority 
to stop excessive speculation in the over-the-counter market. These 
provisions in the Energy Speculation Act and in our Over-the-Counter 
Speculation Act represent a practical, workable approach that will 
enable the CFTC to obtain key information about the OTC market to 
enable it to prevent excessive speculation and price manipulation.
  This legislation will ensure that large traders cannot avoid the CFTC 
reporting requirements by trading swaps in the unregulated OTC market 
instead of regulated exchanges. It will ensure that the CFTC can take 
appropriate action, such as by requiring reductions in holdings of 
futures contracts or swaps, against traders with large positions in 
order to prevent excessive speculation or price manipulation regardless 
of whether the trader's position is on an exchange or in the OTC 
market. The approach in this bill is both practical and workable.
  Mr. President, I urge my colleagues to vote to proceed to the Stop 
Excessive Energy Speculation Act. This legislation contains several 
important provisions that will address the problem of excessive 
speculation that has been contributing to high commodity prices.
  The ACTING PRESIDENT pro tempore. The Senator from New Mexico is 
recognized.
  Mr. DOMENICI. Mr. President, I ask unanimous consent that I be 
permitted to use the remaining time, including the remaining leader's 
time.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Mr. DOMENICI. Mr. President, it is good to be with you today to talk 
about this. Before we begin a vote on a serious subject matter, it is 
good to talk to you about a few issues and thoughts I have about what 
is happening and what should be happening during the next 2 weeks in 
the Congress.
  This morning millions of Americans woke up to another costly commute 
to their workplace. They paid over $4 per gallon to fill their tanks. 
You will recall that 18 months ago it cost them about $2.60 to purchase 
the same amount of gasoline.

[[Page S6990]]

  Family budgets are hurting. On average, the American family will 
spend $2,200 more for gasoline this year compared to last year. A 
number of surveys suggest that Americans are driving less because the 
increased price at the pump is too much a strain on their lives. They 
are turning to us, their elected representatives, and they are looking 
for real leadership. Sometimes I wonder whether they have given up or 
whether they actually expect us to do something. I suggest we ought to 
do something, and any effort on the part of the majority to make this a 
couple a day event with a vote on each side or perhaps no votes or no 
amendments by Republicans, let me say that will not be accepted with 
very much enthusiasm by the minority, and the Republicans will insist 
that we stay here until we have had an opportunity to vote on 
significant amendments that we think the American people are entitled 
to have put before the Senate.
  It seems to me the American people are turning to us, their elected 
representatives, and asking and looking for some leadership. In 
overwhelming majorities, the American people are clamoring for more 
energy production at home. If any oil production or natural gas 
production exists that we own, which we are not allowing to be 
produced, the American people are saying: Why not? In fact, they are 
saying why not open it; let's see what it yields, what it does for us.
  The message is clear: Americans are saying we need to drill for more 
American oil. Now, anything short of allowing up-or-down votes on 
amendments that will determine whether we honor the request of the 
American people to drill for more American oil--whether we are going to 
be permitted to do that is obviously in the hands of the Democratic 
leader. But I believe we will do our share as the minority--49 of us--
to make sure the American people understand whether they are getting a 
fair shake by us getting a fair shake here on the floor on amendments 
that would inure to the benefit of the American people. The majority 
has offered a speculation bill, so far, and that is all we have seen. 
In the midst of this clarion call from the American people, it now 
appears my friends on the other side of the aisle might have to be 
dragged kicking and screaming to even debate whether we need to produce 
more energy.
  After a litany of stale proposals that were rejected--including a 
windfall profits tax, price gouging, manufacturing taxes, cap-and-trade 
taxes, and lawsuits against OPEC--the majority seems content to hang 
its hat on the speculation bill, and a possible ``use it or lose it'' 
policy. As I speak, it appears that the majority drafts in secret a 
policy that claims to advocate lower prices while not actually 
increasing production, and the American people, I believe, will grow 
more and more impatient, and it will not be hard for them to understand 
what we are saying as we tell them their impatience is justified.
  I wish to address the ``use it or lose it'' issue. You understand 
that the other side is saying, as far as offshore drilling, there are 
already leases that exist, where we have given oil companies, large and 
small, the right to drill for oil or gas under the conditions of the 
leases that went forth. They were obtained by the oil companies, large 
and small, by bids. Some bids were very high, some were not so high. 
All in all, there are a lot of oil companies that have the right to 
drill. So the other side is asking, how many acres do they have the 
right to drill upon? And now they are sitting around trying to draft 
legislation that says they are not using that land they leased from us; 
they are not using it as much as they should, and we want to pass a law 
that says: Use it as we prescribe in this new law or lose it.
  They are going to try to tell the American people that is the way to 
get more oil out of parts of the coastal areas of America--
understanding they are already leased. Oil companies already have paid 
money and oil companies are probably already doing everything they can 
to maximize their return on those leases. Yet, since there are a lot of 
acres, some of which have not yet produced, they are saying let's look 
at them and that is where we can get this new oil for America.
  We say that is not true. Those leases are time-certain leases, all of 
them. They are either 5-year or 8-year or 10-year leases. However many 
millions of acres it is, that is what they are. If you don't produce 
within the timeframe allowed in the leases--5, 8, or 10 years--then you 
lose the lease. That is already the law. You already lose it based upon 
the leases you have.
  Let's talk about this idea a little more. This idea was dreamed up in 
an argument first originated by the Wilderness Society. They claimed 
that oil companies were sitting on leases, and that if those companies 
developed those areas, we would not need to open new ones. If only that 
were true, what a wonderful bonanza we would have for the American 
people. It is not true. The other side is now saying oil companies must 
use it or lose it when it comes to these leases. They have proposed 
adding a tax on companies to punish them for not producing fast enough. 
This Wilderness Society argument demonstrates a fundamental lack of 
understanding of how we explore for oil and gas in this country. And 
the fact that this argument originates with a group that has led at 
least four major lawsuits in the past 4 years to prevent development in 
these very same areas speaks to how disingenuous it is. Part of the 
reason it takes so long for companies to produce is because groups such 
as the Wilderness Society keep throwing up roadblocks.
  Companies are paying lots of money for the right to explore on a 
lease and are given a short period of time to produce oil. That is the 
way it is today already. We don't need a new law for that. We don't 
need new legislation now, when we have a limited amount of time--
perhaps 2 or 3 weeks--to debate energy legislation. With the cost of 
oil at $135 per barrel now, why on Earth would a lessee intentionally 
sit on a lease and choose not to make money on it?
  Why would a company pay money essentially to rent a tract of land and 
then not use it? I heard the claim that 41 million acres is leased on 
the Outer Continental Shelf and that acreage, 33 million acres, is not 
being produced. The use of this statistic shows a fundamental lack of 
understanding of the long, risky process that begins even before 
bidding on a lease and hopefully ends with production. The other side 
is saying that unless oil is literally coming out of the ground on an 
acre, it doesn't count. Even if the acre is being explored or is in the 
process of getting an environmental permit or is in any way part of a 
process that is going on, it doesn't count. Additionally, the use of 
this argument by groups that consistently go to court to prevent 
development on existing lease areas speaks volumes about the intent 
here. Congress currently restricts access to 574 million acres in the 
Outer Continental Shelf. It actually is clear by any measurable 
assessment that the majority in Congress is ``sitting on'' far more oil 
than the oil companies themselves.
  There are many different steps toward producing oil, and that, at any 
given moment, may not be producing but is active and under development. 
In the 5, 8, and 10 years that a company holds a lease, environmental 
assessments could be underway. Lessees could be trying to secure 
permits. The leasing agency could be challenged in litigation and could 
be reviewing seismic data. All of this takes time. So you look out 
there and say: It is leased, but it isn't producing yet. Of course not. 
If somebody tried to produce too quickly, they would be challenged for 
not spending enough time under the environmental permit laws doing what 
is required before one can drill.
  There are many upfront costs that leaseholders take, that they have 
to do if they are going to acquire an oil and gas lease. Bonus payments 
and production, rental payments often cost millions of dollars, and 
these capital investments are only being made for the ultimate 
development and production of oil to return a profit on their 
investment. Simply put, if oil is not produced from a lease, the 
companies lose money on it.
  To claim that companies are ``sitting on'' $135 oil simply ignores 
the historical fact that because you lease lands does not necessarily 
mean you are able technically or economically to produce on them or 
even that there is oil under your lease. But you are entitled to keep 
it and try to make it productive for the length of time that the lease 
prescribes within the contents and terms of the document--5 years, 8 
years, or 10 years.

[[Page S6991]]

  Finally, we should point out that the majority already has a ``use it 
or lose it'' policy. If you are not producing when the term of the 
lease expires, you turn it back. So this argument really is a fallacy. 
I have said this before on the floor. It seems as if the more it is 
said, the more it is documented, the more the other side claims that 
there are many leases that we should force the lessees to give the land 
back or produce under some new slogan called ``use it or lose it.''
  As the specter of a limited debate lingers with minimal or no 
opportunity for amendment on this bill, the American family budget 
continues to be squeezed. Mr. President, 83 days after introducing the 
American Energy Production Act of 2008, I continue offering a new 
direction.
  In 2006, we opened 8 million acres in the Outer Continental Shelf for 
leasing. This area contained an estimated 1.2 billion barrels of oil 
and nearly 6 trillion cubic feet of natural gas. In March of this year, 
two lease sales on the eastern and central Gulf of Mexico attracted 
more than $3.2 billion in high bids, upfront bids--a very high payment. 
The first sale in the central gulf was the largest sale in the history 
of deepwater OCS leases.
  This area is America's new frontier. Today, there are more than 7,000 
leases in the Gulf of Mexico that provide 25 percent of the oil 
produced in the United States and 15 percent of the natural gas 
produced in the country. The Department of Interior estimates that 
300,000 jobs are directly related to gulf energy exploration and the 
production that comes from that exploration.
  As a result of the Gulf of Mexico Security Act, the coastal States 
stand to reap great benefits from the production of gas through revenue 
sharing of oil and gas. The following rough estimate provides a window 
into the opportunity available to other States. According to the 
Minerals Management Service, Gulf States could receive more than $425 
million in oil and gas revenues by 2013, $2.6 billion over the coming 
decade, and over $30 billion over the next 30 years. Yes, those are 
accurate estimates. That is what other States--not all of them but some 
other States--that are on our coasts that might agree to let us look in 
exchange for giving them the same kind of return we gave Louisiana, 
Mississippi, and the surrounding States, that is what they could look 
for. These are huge sums that will be raised and returned to the States 
through the production of our own energy resources.
  They seek to allow coastal States on the Atlantic and Pacific to 
share in the energy opportunity. I know there are various opinions as 
to how many we will find there, but we will never know so long as we 
keep it locked up, which we have done for 26 to 27 years, where nobody 
would know and tried to hide it from the American people as if it did 
not belong to them and it was not any good. The truth is, it is theirs 
in absolute honest-to-God ownership, and it can produce crude oil of 
the best type and oil in large quantities.
  Let's hope that what we do in this area is equal to nearly all the 
oil produced in the Gulf of Mexico in the last 50 years and is greater 
than all the oil imported into the United States from the Persian Gulf 
in 15 years.
  This is a big opportunity for the American people, but the majority 
seems content with small ideas. Within two Congresses, we have passed 
two major pieces of energy legislation. These two bills were monumental 
undertakings and required months of deliberation to bring to fruition.
  Last Congress, we had EPACT05 on the floor of the Senate for 10 days. 
We had 23 rollcall votes on the bill, including 19 just for amendments. 
We had filed 235 amendments to that bill; 57 of them were accepted. 
That bill took 4 months from the introduction before we sent it to the 
President.
  Last year's Energy bill took almost a year before we had something we 
could send to the White House. That bill was on the Senate floor for 15 
days and had a total of 22 rollcall votes. We filed 331 amendments to 
that bill and accepted 49 of them.
  The majority leader seeks to limit the amendment process in a 
significant way. I trust we will have the staying power to at least 
have an opportunity for multiple amendments in the area we are speaking 
of because the American people deserve it and the American people 
should have it.
  I have completed my remarks. I yield the floor.
  Mr. REID. Mr. President, it is my understanding I have 10 minutes 
under the order. I yield 5 minutes of that time to the Senator from 
Washington.
  Mrs. MURRAY. Mr. President, all of us who go home and listen to our 
constituents each weekend know one thing and one thing only is on their 
mind these days; that is, the rising price of gas. I have made a habit 
of writing down what I pay each weekend when I fly out to Washington 
State, and when it hit $4 a month or so ago, I was aghast. Imagine what 
everyone filling their tank in Washington State is thinking now that 
the price in my home State is pushing $4.50 a gallon. We need action. 
We need action now.
  For months, Democrats have been trying to address this problem by 
providing short-term relief along with a long-term strategy. For 
months, we have heard only two things from our friends on the other 
side of the aisle: No, and drill. Democrats know there is no silver 
bullet to this crisis. It is going to take a series of steps, both 
short term and long term, to bring some sanity back to the situation.
  Today, we are going to vote on another of those short-term solutions, 
and we are going to try to end excessive speculation in the markets. 
Democrats believe we have to rein in Wall Street and our traders who 
are unfairly driving up these oil prices. With regard for nothing but 
their own profits, some traders are bidding up oil prices by buying 
huge quantities of oil just to resell it at an even higher price. For 
nearly 8 years now, the Bush administration has turned a blind eye and 
let these questionable practices continue with virtually no oversight. 
Some experts are saying this kind of trading now accounts for 20 to 30 
percent of what we pay at the pump.
  The Senator from Texas, Mr. Cornyn, was on the floor earlier and 
asked for specific citations. Mr. President, I ask unanimous consent to 
have printed in the Record remarks from a series of economists, such as 
Gerry Ramm of the Petroleum Marketers Association, the Acting Chairman 
of the Commodity Futures Trading Commission, the former Director of the 
Commodity Futures Trading Commission, and others.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

       Economist Mark Zandi Said Speculation Played a Role in 
     Driving Up Oil Prices. Asked if he believed speculation 
     played a role in driving up oil prices, Zandi responded, 
     ``Yes, I believe so, yes. The oil market has become a 
     financial market. And it's affected by all kinds of 
     speculators, momentum players, people just betting on prices 
     increasing or falling, in this case, obviously, increasing. 
     And so they ran in quickly and drove up the price. And that 
     clearly has played a role. I mean, you don't see a $10 move 
     in the price of oil without some financial speculation in-
     volved, as well.'' [PBS Online Newshour,
     6/6/08]
       Gerry Ramm of the Petroleum Marketers Association of 
     America Blamed Speculation for Driving Up Oil Prices. 
     ``Excessive speculation on energy trading facilities is the 
     fuel that is driving this runaway train in crude oil prices 
     today. Excessive speculation is being driven by what Michael 
     Masters of Masters Capital Management refers to as index 
     speculators, as compared to traditional speculators.'' 
     [Testimony of Gerry Ramm, Petroleum Marketers Association of 
     America, before Senate Committee on Commerce, Science and 
     Transportation, 6/3/08]
       Acting Chairman of Commodity Futures Trading Commission 
     Said the Oil Markets Are ``Ripe for Those Wanting to 
     Illegally Manipulate the Market.'' Walter Lukken, Acting 
     Chairman of the Commodity Futures Trading Commission, 
     conceded that crude 
     oil markets are ``ripe for those wanting to 
     illegally manipulate the markets.'' [CNBC,
     06/17/08]
       Former Director of Commodity Futures Trading Commission's 
     Trade Division Michael Greenberger Said Speculation Went 
     Beyond Supply-and-Demand Problem in Oil Market. Michael 
     Greenberger, a former top staffer at the Commodities Futures 
     Trading Commission, said, ``There can be no doubt that there 
     is a supply-and-demand problem at work here. But many 
     believe, including me, that there's a speculative premium 
     that goes beyond what supply-and-demand factors dictate. And 
     that's what could be drained with aggressive United States 
     regulation.'' [McClatchy, interview of Michael Greenberger, 
     6/17/08]
       Greenberger Calculated 70 Percent of Oil Market is Driven 
     by Speculators, Rather Than Those With Commercial Interests. 
     ``My calculation is right now that about--at least 70 percent 
     of the U.S. crude oil market is driven by speculators and not 
     people with

[[Page S6992]]

     commercial interests. Most of those speculators do not have 
     spec limits. They can buy whatever they want.'' [Testimony of 
     Michael Greenberger, Professor at University of Maryland Law 
     School, before Senate Committee on Commerce, Science and 
     Transportation, 6/3/08; McClatchy, 6/17/08]
       Former Director of Commodity Futures Trading Commission's 
     Trade Division Michael Greenberger Said Oil Speculation Adds 
     25-50 Percent to the Cost of Oil. When Michael Greenberger, a 
     former top staffer at the Commodities Futures Trading 
     Commission, was asked how much oil speculation increased 
     costs per barrel of oil, he replied, ``Well, there have been 
     various estimates--anywhere from 25 percent to 50 percent.'' 
     [CBS News, 06/17/08]

  Mrs. MURRAY. Mr. President, the Stop Excessive Energy Speculation Act 
of 2008 that the Senate is going to move to proceed to will shine a 
light on those trading markets. It will increase oversight and 
reporting on oil trading, and it will significantly improve the 
resources available to the Commodity Futures Trading Commission. While 
addressing speculation is not the silver bullet that will bring prices 
down at the pump, we do believe that by increasing our oversight and 
regulation, we will ensure that consumers are better protected in the 
months and years to come.
  Unfortunately, as I mentioned earlier, our friends on the other side 
have their message down pretty pat now. They say no to any reasonable 
solutions we offer, and then they turn around and say we just need to 
drill more. We say fast-track our domestic production. They say no. We 
say increase the supply of oil now. They say no. We say accelerate 
investments in alternative energy to help break that addiction to oil. 
They say no. And now we say end excessive speculation. I hope they 
won't say no again.
  Do they offer anything more than no? Well, yes. They say drill, 
drill, and drill--a plan that even their party's leaders said has 
mainly psychological benefits, a plan that even President Bush's own 
team says will not affect our oil prices, and a plan that will not 
produce a drop of oil for 7 to 10 years.
  Unfortunately, their plan on that side is nothing more than a 
continuation of the Bush-Cheney big oil love affair that got us into 
this mess in the first place. Republicans seem committed to fattening 
big oil's bottom line. Well, Democrats are more worried about your 
bottom line.
  The oil companies made $250 billion last year. It is time for us to 
deal with consumer prices. We have tried to do things the Republican 
way for 8 years now and unfortunately what we hear from them today is 
more gimmicks and tired old ideas, the same status quo.
  With record gas prices and our economy spiraling deeper into 
recession, Democrats think it is long past time for a bold new 
direction. We hope our Republican counterparts will join us today and 
move this bill forward.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The majority leader.
  Mr. REID. I ask unanimous consent to use leader time to complete my 
statement over and above the 5 minutes.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Mr. REID. Mr. President, the American people, I am sure, viewing our 
proceedings here in the Senate or from the visitors gallery or on C-
SPAN must think they are watching an episode of the ``Twilight Zone.'' 
The reason I say that is yesterday morning, Senator McConnell and I 
both opened with statements about our national energy crisis. We both 
talked about the plan we had and the pain that high gas prices are 
causing the American people.
  Recently, I mentioned a public school teacher--he delivered the 
Saturday address for us--and his wife who live in upstate New York who 
are now spending all of the money they saved for their children's 
college education to pay for gasoline.
  Senator McConnell, for his part, talked about the frustration of 
truckers, stay-at-home parents, commuters, and vacationers. Anyone 
watching our two sides talk about the gas prices must have gotten a 
little confused. They must have been saying to themselves: If they both 
agree on the problem, why can't they work together to find a solution? 
The reason for that is very simple: Republicans and Senate Republicans 
refuse to join in negotiating in any way. They refuse to legislate. 
They, in fact, refused to take ``yes'' for an answer. We are shortly 
voting on cloture to proceed on legislation to stem the excessive 
speculation on Wall Street that is contributing to high gas prices.
  Is this the only problem? Of course not. But it is a problem, 
absolutely. Democrats have said from the start that curbing speculation 
is not a panacea and will not solve all of our energy problems with the 
snap of our fingers.
  But there was a Republican Senator on the floor today who asked a 
question: Who is saying this speculation accounts for 20 to 50 percent 
of the price of gasoline? We have laid those names in the Record. There 
is no doubt that it is a major part of the problem. The Republicans 
acknowledged that by putting that provision in their so-called energy 
bill.
  But with experts saying that speculation accounts for 20, 30, even 50 
percent of the price of gasoline, there is no doubt there is a major 
problem. How does excessive speculation drive up prices in the short 
term? Wall Street traders simply buy oil, sell it, and I repeat, as 
they do: They buy, they sell, they buy, bidding the price ever higher. 
They never intend to actually own or use the oil they buy, they only 
keep buying and selling and pocketing the profits. The problem is the 
American people are stuck paying the bill every time we fill our gas 
tanks.
  This kind of unlimited energy speculation was not even legal 8 years 
ago for traders who never intended to buy or sell or use the commodity. 
Back then you would have to actually take delivery of the oil you 
bought or face position limits on your trading. Few Wall Street firms 
wanted tankers pulling up to their front doors with barrels of oil.
  The market price of oil was decided by honest people in the 
marketplace, the so-called supply-and-demand factor. Then the 
Republican Congress stepped in and allowed oil to be traded back and 
forth without even delivery of the oil. That effort was led by former 
Senator Phil Gramm, chairman of the Banking Committee, a long-time 
member of the Finance Committee, the same Phil Gramm who served as 
Senator McCain's economic adviser until yesterday, and recently called 
America a nation of whiners.
  This is the same guy who has set forth his speculation aspect of what 
is hurting the market so badly. Senator Gramm's bill created a mouse 
click; that is, you touch your computer and you can buy lots of oil you 
will never use and never want to use.
  The Bush administration has done nothing to oversee this. Now the 
American people are suffering the consequences. Nothing is ever certain 
in the energy market. But if our legislation to provide new consumer 
protections on speculation becomes law, it should immediately and 
sustainably lower prices.
  Democrats are not the ones who think so. I do not know the party 
affiliation of the people whose names I am going to list, the experts: 
Former CFTC Trade Division Director and current economics professor at 
the University of Maryland, Michael Greenberger. He says the price is 
from 20 to 50 percent because of speculation.
  Consumer advocate Mark Cooper says the same. And even the senior vice 
president of ExxonMobil, Stephen Simon, says speculation is part of the 
problem; even Exxon. We have a man who serves as the chief executive 
officer of United Airlines, Glenn Tilton. Here is a man who was 
president of Texaco, vice chairman of Chevron, and he says speculation 
is a big problem and we have to do something about it and do it right 
away.
  So my Republican colleagues who say speculation is not an issue, here 
are a few of the people who agree with us. And obviously, the 
Republicans must have thought in the old days, a couple of weeks ago, 
that it was a problem because they stuck it in their legislation. Now 
they say it is not important.
  But my friends on the other side of the aisle have said in speeches 
and press conferences that we should do something about speculation--
that is what they used to say. It has been a component of their energy 
plan. In fact, Senator McConnell said on the floor yesterday, 
``strengthening regulation of the futures market is a worthwhile piece 
of the legislative effort.''

[[Page S6993]]

  The American people must be thinking, Democrats and Republicans do 
not agree on much, but they seem to agree that curbing excessive energy 
speculation is part of the solution. If we did nothing else but pass 
the speculation bill, the American people would be very happy, and the 
markets would be struck quickly and the price of oil would go down.
  Yet now that a reasonable and responsible speculation bill has 
reached the floor, Republicans seem to be scurrying into the corners 
and shadows of this Capitol complex. Now that we have an opportunity to 
actually do something to deliver some relief to the American people, 
all Republicans want to talk about now is drilling. They are so happy 
that the oil companies are running full-page ads about drilling.
  Democrats have shown how serious we are about addressing this 
problem. We have said to the Republicans: Along with our speculation 
bill, let's vote on your offshore drilling. That is what you said is 
the problem. Let's drill some more. Let the Governors decide what 
should happen on the Outer Continental Shelf. They said that is what 
the problem is. Let's do something about it.

  And we said: Okay, let's vote on that. Well, they say: No, that is 
not a good idea. Even though we believe in that and we have talked 
about for months how important drilling is, we want 27 other 
amendments. We do not want to do anything about speculation, and we do 
not even want to have a vote on drilling unless you give us 27 other 
amendments.
  Let's assume that Republicans would allow a vote on their amendment, 
and we have a vote on a Democratic drilling amendment. You see, we are 
not opposed to drilling. Democrats are not opposed to drilling. We 
believe the future is ahead of us, and we believe the oil companies 
should use the 68 million acres they now have; the 8.3 million acres 
that we worked on less than 2 years ago to give them the ability to 
take a look in the Gulf of Mexico. They said it was so important to do 
that. They have not done anything about that. I do not think they have 
gone fishing out there, let alone doing any exploration out there. 
There are 8.3 million acres; they have not done a thing with it. We 
have 25 million acres in Alaska that are subject to being drilled right 
now. All the White House has to do is let some more of these leases.
  So we are not opposed to drilling. But we are saying: Use the 68 
million acres. Take a look at all the other land available. This 
drilling is a political thing for the Republicans. Simple math 
indicates we control, counting ANWR--which, by the way, McCain is now 
against; he does not want to drill in ANWR. But let's assume you take 
ANWR and all the other offshore issues they are talking about. That is 
less than 3 percent of the oil in the world. We use more than 25 
percent of the oil every day. We cannot drill our way out of the 
problems we have.
  So we think it does not make sense to start giving up more acres of 
American coastline in addition to the 68 million, plus the 25 million 
acres in Alaska. We believe it makes sense to open more coastal areas 
for drilling. We say: Go ahead and do that. The President has the 
authority to do that.
  Time Magazine this week, the one that is on the newsstands today--I 
tore a page out of it: The offshore waiting game. They have a little 
piece of literature here. They say it is going to take a long time. 
Here is why: It will take up to 2 years for oil companies to survey 
sites and bid on available leases. It will take up to 2 years for the 
highest bidders to do seismic tests and analyze the results. It will 
take up to 3 years for exploratory drilling. It will take up to 2 years 
if oil is discovered; plans for platforms and pipelines are submitted 
for Government review. It will take another year to review that. It 
will take up to 3 years for oil companies to build platforms and 
pipelines. And finally the oil is pumped out.
  Add those numbers together and it is about 15 years. Well, what we 
say, we are not opposed to drilling, but there are lots of places we 
can be drilling right now. So the American people cannot wait all of 
these years. Increasing production is important, but even Republicans 
must admit it will do absolutely nothing to lower prices in the near 
term.
  Nevertheless, Republicans have called for a vote on their offshore 
drilling plan. We are willing to give them what they want. They are not 
willing to take ``yes'' for an answer.
  I hope all Senators, Democrats and Republicans, would vote to invoke 
cloture on the speculation bill, that we can go forward with that, have 
a vote on their drilling, and we have read all of the ads the oil 
companies have paid for, and the Republicans have followed step by step 
what the oil companies want. We are willing to give them a vote on 
that. I do not know how we can be more fair than that. All we want is 
the opportunity to vote on what we think is important too.


                             Cloture Motion

  The ACTING PRESIDENT pro tempore. Under the previous order, pursuant 
to rule XXII, the clerk will report the motion to invoke cloture.
  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 motion to 
     proceed to Calendar No. 882, S. 3268, the Stop Excessive 
     Energy Speculation Act of 2008.
         Harry Reid, Jeff Bingaman, Byron L. Dorgan, Christopher 
           J. Dodd, Amy Klobuchar, John F. Kerry, Daniel K. 
           Inouye, Patrick J. Leahy, Patty Murray, Bernard 
           Sanders, Jack Reed, Sheldon Whitehouse, Bill Nelson, 
           Richard Durbin, Frank R. Lautenberg, Tom Harkin, Maria 
           Cantwell.

  The ACTING PRESIDENT pro tempore. By unanimous consent, the mandatory 
quorum call is waived.
  The question is, Is it the sense of the Senate that debate on the 
motion to proceed to S. 3268, a bill to amend the Commodity Exchange 
Act, to prevent excessive price speculation with respect to energy 
commodities, and for other purposes, shall be brought to a close?
  The yeas and nays are mandatory under the rule.
  The clerk will call the roll.
  The bill clerk called the roll.
  Mr. DURBIN. I announce that the Senator from Massachusetts (Mr. 
Kennedy), the Senator from Illinois (Mr. Obama) and the Senator from 
Rhode Island (Mr. Reed) are necessarily absent.
  I further announce that, if present and voting, the Senator from 
Rhode Island (Mr. Reed) would vote ``yea.''
  Mr. KYL. The following Senators are necessarily absent: the Senator 
from Tennessee (Mr. Alexander), the Senator from Nebraska (Mr. Hagel), 
and the Senator from Arizona (Mr. McCain).
  Further, if present and voting, the Senator from Tennessee (Mr. 
Alexander) would have voted ``yea.''
  The ACTING PRESIDENT pro tempore. Are there any other Senators in the 
Chamber desiring to vote?
  The yeas and nays resulted--yeas 94, nays 0, as follows:

                      [Rollcall Vote No. 183 Leg.]

                                YEAS--94

     Akaka
     Allard
     Barrasso
     Baucus
     Bayh
     Bennett
     Biden
     Bingaman
     Bond
     Boxer
     Brown
     Brownback
     Bunning
     Burr
     Byrd
     Cantwell
     Cardin
     Carper
     Casey
     Chambliss
     Clinton
     Coburn
     Cochran
     Coleman
     Collins
     Conrad
     Corker
     Cornyn
     Craig
     Crapo
     DeMint
     Dodd
     Dole
     Domenici
     Dorgan
     Durbin
     Ensign
     Enzi
     Feingold
     Feinstein
     Graham
     Grassley
     Gregg
     Harkin
     Hatch
     Hutchison
     Inhofe
     Inouye
     Isakson
     Johnson
     Kerry
     Klobuchar
     Kohl
     Kyl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Lugar
     Martinez
     McCaskill
     McConnell
     Menendez
     Mikulski
     Murkowski
     Murray
     Nelson (FL)
     Nelson (NE)
     Pryor
     Reid
     Roberts
     Rockefeller
     Salazar
     Sanders
     Schumer
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stabenow
     Stevens
     Sununu
     Tester
     Thune
     Vitter
     Voinovich
     Warner
     Webb
     Whitehouse
     Wicker
     Wyden

                             NOT VOTING--6

     Alexander
     Hagel
     Kennedy
     McCain
     Obama
     Reed
  The ACTING PRESIDENT pro tempore. On this vote, the yeas are 94, the 
nays are 0. Three-fifths of the Senators duly chosen and sworn having 
voted in the affirmative, the motion is agreed to.
  The ACTING PRESIDENT pro tempore. The Senator from Maryland.
  Ms. MIKULSKI. Mr. President, I ask unanimous consent that the time 
until

[[Page S6994]]

12:30 be equally divided between the two leaders or their designees, 
and that the time during the caucus recess count postcloture.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Ms. MIKULSKI. I thank the Chair.
  Mr. President, I now seek recognition in my own right.
  The ACTING PRESIDENT pro tempore. The Senator from Maryland.
  Ms. MIKULSKI. Mr. President, there is a buzz on the floor. I would 
like regular order.
  The ACTING PRESIDENT pro tempore. Can I get the Chamber to come to 
order, please.
  The Senator from Maryland.
  Ms. MIKULSKI. I thank you, Mr. President.
  The reason I have asked to be heard is because my constituents want 
to be heard. I am here today to speak on the Senate floor about the 
skyrocketing high prices at the pump, which are really hurting my 
constituents. They are hurting families, they are hurting small 
businesses, and they are hurting all of our volunteer efforts.
  Gas prices in my State have dramatically increased. In March of last 
year, 2007, gas prices were at $2.50 a gallon. They have now 
skyrocketed to $4 a gallon. There has been a $1.50 increase in a little 
over a year. My Maryland families are now paying $5,000 per year on 
gas. That is up from $3,200 a year when George Bush took office.
  In the Federal Government's budget, $2,000 might not be a lot, but in 
a family budget it is a budget buster. Look what you can do for $2,000. 
No. 1, if you are a senior, it pays for the doughnut hole so you can 
get your prescriptions filled. If you are a family, that is enough to 
send one of your children to a community college.
  Yes, $2,000 makes a big difference. Maryland families are stretched 
and strained. Gas prices drive their lives, and they feel as though 
they are running on empty. Gas and groceries go together. When gas goes 
up, so do groceries because of just the added cost of delivering them.
  When you talk to families, they are struck with incredible anxiety, 
wondering where is this going to end. The cost of commuting has more 
than doubled or is even close to tripling for many of our families.
  Families are now asking how do they get their kids to school or to 
soccer practice or to other activities.
  Seniors are wondering how do they cluster their medical appointments 
so if they live in the rural part of my State, they can drive to the 
doctor they need, while wondering about how they are going to fill up 
their gas tank.
  The seniors I represent say: If I have to fill up my tank, I don't 
know if I can fill my prescription or even get to the doctor.
  We have to do something.
  As to the impact on business--from the taxicab driver, where the 
costs are going up, to the florist making deliveries, to the trucker 
delivering goods--what we see is they either have to pass the cost on 
to the consumer or go broke. We cannot let people go broke because of 
skyrocketing gasoline prices.
  A sector that is very near and dear to me is the volunteer sector. 
Look at the impact of rising gas prices on Meals on Wheels. Nearly 60 
percent of the Meals on Wheels programs have lost volunteers who cannot 
afford gas. Did you hear that? Sixty percent of the people who deliver 
Meals on Wheels have said they have to take a pass because they cannot 
afford gas. Most of the people who deliver Meals on Wheels are seniors 
themselves. Senator Cardin has a bill to alleviate that.
  So everything from Meals on Wheels to volunteer firefighters, who are 
trying to figure out how to pay for the gas for their firetrucks, we 
are in a serious crisis. So we have to act.
  Now, there are those who say: Drill here and drill now. I will talk 
about drilling on another day because I support smart drilling that is 
environmentally safe, achieves productivity, and, if we drill, stays 
here. I believe we have 68 million acres already owned by the oil 
companies. So if they want to drill, drill where they have it.
  But what I want to talk about today is what we know is driving up the 
cost per barrel by as much as $80. This bill is about speculation. This 
bill that is pending for discussion in the Senate is about casino 
economics, and that is what is going on now. We have people trading in 
the energy market not to be able to buy the futures in oil for their 
own use--whether you are a local government or whether you are a 
refinery. It is about trading in futures and building it up like a 
pyramid scheme. They do this casino economics by doing a lot of their 
trading through loopholes, one of which is called the London loophole.
  The London loophole is about an exchange called the InterContinental 
Exchange. It is in London. It is owned by an Atlanta company to evade 
American laws and regs. Did you get that loophole, Mr. President? The 
London loophole is about an intercontinental exchange in which 30 
percent of American energy futures are traded. It is owned by an 
Atlanta company.
  Why do they do this through London? Because it evades American laws 
and regs against speculation.
  Well, we can immediately deal with the gouging and the excessive 
speculation by closing that London loophole. That is part of the bill 
that, if we move past cloture, we can get. We need to close that London 
loophole so investors cannot exploit the market by avoiding U.S. law 
and avoiding U.S. regulation. If you are going to trade as an American 
company, go by American rules.
  The legislation we propose makes sure the Commodity Futures Trading 
Commission sets tough limits on speculators. By the way, that group, 
the CFTC, is the regulator for commodities. It is called the Commodity 
Futures Trading Commission. We want them to be able to have the legal 
authority to set limits to deal with excessive speculation.
  We also want to give them the resources they need. In 2003, the 
futures market was $13 billion. Today, it is $260 billion. That is 
``b'' like in ``Barb,'' not ``million'' like in ``Mikulski.'' So we 
have seen this enormous increase, but we do not have the professional 
staff to be the cops on the beat to deal with speculation and illegal 
activity. So our legislative proposal calls for 100 more professionals. 
We want to detect excessive speculation and fraud. We want to prevent 
it, and we want to prosecute it.
  Markets need to work for free enterprise, not for freewheeling 
exploitation. Closing the London loophole and putting caps on 
speculators to stop the casino economics is recommended, and it is 
predicted we could lower the cost per barrel by as much as $80. So if 
oil is trading at $130 or $140 a barrel, we could bring it down, 
generally, to a more reasonable market-based price of about $60 a 
barrel.
  That would be stunning. That would be absolutely stunning. It would 
get us back to where we were last year. It would give us an important 
path forward to help our economy, which is in a deep recession. We know 
we have to do more. We Democrats believe in conservation. That is why 
we increased the CAFE standards, which go to greater full utilization 
in passenger vehicles and trucks and buses. We know we have to develop 
alternative fuels. We need to do research and pass tax incentives so we 
power our homes with wind and solar. We also know we need to stop price 
gouging.
  We have to roll up our sleeves and get the job done. It is one thing 
to debate ideas, it is another thing to have a filibuster. I believe in 
debating ideas, taking a vote, and letting the majority win. I am ready 
to duke it out on the idea.
  My constituents and I are pretty sick of the tyranny of 60. I thought 
in this country in a body of 100, 51 was a majority. We have these 
arcane rules that we can play games with to hide behind our true 
thinking. I call it the tyranny of the 60. It is slowing down what we 
need to face up to, which is real debate and real votes.
  I believe energy will determine our destiny, our security, our 
economy, and our standing in the world. This is a serious matter. For 
the last 18 months, with the Republican obstructionism, what we have 
found is that when all is said and done, more gets said than done. 
Let's end the filibuster, let's end the parliamentary games, and let's 
get serious about what the American public wants us to do, which is 
roll up our sleeves and present the best idea for arriving at 
solutions. Let a real majority win and, most of all, let's start 
putting America first, putting America over political parties. I am a 
member of the Democratic Party, but a

[[Page S6995]]

larger party I belong to is the red, white, and blue party. I think we 
should have to start acting that way. Let's get the job done, bring 
this to a vote, and let's stop the speculation, stop the cronyism, and 
let's get real value for the American people.
  Mr. President, I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Nevada is 
recognized.
  Mr. ENSIGN. Mr. President, when I am approached about the energy 
crisis we are facing--and I am approached frequently by constituents 
and even family and friends--you can tell that people are feeling at 
the least very uneasy about this situation. There is a weight that 
comes with soaring prices on fuel, food, and everything else that is 
part of our daily spending habits. Every time Americans fill up their 
tanks, check-out at the grocery store, or make a decision about where 
to cut spending, that weight gets heavier and heavier.
  The American people are looking to us for solutions. We have a 
responsibility to make difficult decisions here in order to provide 
them much needed relief at home. For many months, Republicans have been 
working to provide that relief. We have been focused on a three-pronged 
approach: boosting renewable energy, encouraging energy efficiency, and 
growing our American supply of energy. This line of attack balances the 
need for us to be responsible stewards of our environment with the need 
for reliable, affordable energy to fuel our lives and our economy. We 
are not in a position to rely on any one solution to lift us out of 
this crisis.
  However, the Democrats are focusing their efforts on a single idea to 
respond to the pleas of Americans. Rather than dedicate this body to 
building a comprehensive energy plan that provides real solutions for 
the future, Democrats have put forward a plan to curb speculation. This 
approach does little, if anything, about high gas prices. Instead, the 
Democrats' speculation bill could hurt our economy by eliminating 
investment options that our Nation's retirees depend on, make American 
businesses less competitive, and ultimately drive U.S. jobs overseas. 
The only way to significantly lower the price of gas is to increase 
supply.
  Let me repeat that. The only way to significantly lower the price of 
gas is to increase supply. Let's harness the power of our commodities 
markets and take concrete steps to expand the future supply of American 
energy. The market will take this into account, and I am certain we 
will see prices at the pump fall.
  This plan to blame all of our troubles on speculators does nothing to 
bring down prices at the pump, which means it does nothing to bring 
down the price of food, clothing, or any other consumer goods that are 
affected by the price of gasoline. It will not provide relief for 
struggling Americans, and it lacks the vision and the leadership our 
country needs on this issue. All it does is delay other efforts that 
would make a difference.
  One thing the Democrats are doing successfully is blocking the 
efforts of Republicans to fully participate in shaping this 
legislation. The problem is bigger than speculation. Good ideas from 
all sides should be considered.
  We are talking about one of the greatest challenges facing our 
Nation, and our constituents have no voice in this process. They need 
to have their voices heard. Countless constituents have taken time to 
share their personal stories with me, and there is a common thread in 
their messages. Fixed-income seniors worry about driving to the doctor, 
buying their medicine, and paying for food. They are asking for real 
solutions. Many Nevadans cannot afford to travel to visit ailing 
relatives, and our entire tourism industry in the United States is 
being hurt by the high cost of fuel. The airlines are in trouble and 
will be cutting jobs. Manufacturers are cutting jobs. Families have to 
cut spending a little deeper each week to balance their budgets. They 
are asking for real solutions, and they are asking for them now.
  There is a real solution. It is a plan that reflects the innovative 
spirit of our country and the commitment we all have to preserving the 
environment. It involves going back to that balanced approach that 
boosts renewable energy, encourages energy efficiency, and grows our 
American energy supply.

  With families tightening their budgets more and more, with seniors 
struggling month to month, Americans do not want to hear that there are 
trillions--literally trillions--of barrels of American oil off limits 
to meet their energy needs. Trillions of barrels--not in Saudi Arabia 
or Venezuela, or in some other country that hates us--but right here in 
the United States, under our control.
  At least 10 billion barrels are up in ANWR; at least 8.5 billion 
barrels in deep sea exploration; by some estimates, 1.8 trillion 
barrels of oil from oil shale in Colorado, Wyoming, and Utah. We also 
have a 230-year supply of coal and great potential in nuclear energy. 
These American sources, combined with conservation and aggressive 
investment in renewable and green energy--solar, wind, geothermal, 
hydropower, fuel cells, and electric vehicles--are the key to setting 
us on a course to energy independence and security.
  There are some who argue that increasing American energy supply will 
provide no immediate relief. They argue that ANWR, deep sea 
exploration, and oil shale are years away from producing sizable 
amounts of energy. The same could be said for renewable energy 
development. But these changes would lower prices and would do so 
quickly because the market will react to expected energy supply 
increases. The American people would react to the fact that we have 
shown vision and accomplished something for their good.
  Mr. President, how much time do I have?
  The ACTING PRESIDENT pro tempore. There is 2\1/2\ minutes.
  Mr. ENSIGN. Even so, when has instant gratification been the mantra 
of investing in American innovation? Highways and bridges aren't built 
in a day, but we know they are an investment in our infrastructure. 
Schools and libraries aren't built in a day, but we don't throw our 
hands in the air and say ``never mind.'' We plan for the future.
  Standing around talking about how long it will take to get these 
projects on line doesn't help get the process started any faster. The 
time for talk passed as quickly as $3.50 a gallon came and went. Enough 
is enough. The American people are looking to us to provide much needed 
relief. We must rise to the occasion.
  I ask my colleagues across the aisle, what is the magic number for 
gasoline per gallon before they are willing to act on a comprehensive 
energy strategy? The American people want to know how much longer they 
must suffer, while we stand here debating oil speculation.
  Bill Clinton vetoed ANWR 10 years ago in a bill passed by a 
Republican Congress. If he had signed that bill into law, at least 1 
million barrels of oil per day would be coming to the United States. 
Gas prices would be lower.
  Let's not miss another opportunity for action, and let's not ignore 
the cries of frustration from our constituents. Let's show them we 
understand the difficult choices that they are making, and that there 
are solutions on the horizon. Let's act now.
  We need to extend renewable energy tax incentives before they expire. 
If we fail to act, we will be responsible for the end of American 
renewable energy innovation.
  We need to improve the barriers that stand in the way of our new 
American energy frontier. Let's send our enemies in the Middle East a 
pink slip that we won't be requiring their services any longer. Isn't 
it time to stop subsidizing their economies? We send them $700 billion 
a year and, at the very least, they are teaching a new generation to 
hate America. At the worst, they are funding the weapons used against 
Americans. A comprehensive energy plan means that our economy and 
livelihoods won't be held hostage any longer.
  That is the day I look forward to and that all Americans look forward 
to. But to get to that day, we have to act. On behalf of the more than 
2.7 million Nevadans, who need us to do something, I ask you to make 
comprehensive energy legislation something we can all be proud of.
  I yield the floor.
  Mr. SCHUMER. Mr. President, how much time do I have remaining?
  The ACTING PRESIDENT pro tempore. Eight minutes.

[[Page S6996]]

  Mr. SCHUMER. Mr. President, we are at a seminal moment in America. 
American consumers are being battered by high oil prices, high home 
heating oil prices, all high energy prices. The average middle-class 
person is squeezed more than ever before. People are not going to 
college, people are not taking jobs, people are not visiting grandkids, 
and it is all because of high oil prices. It is changing the way we 
live--and not for the better. Americans are crying out.
  What is the answer? My colleagues on the other side of the aisle are 
stuck in the past. They talk about drilling more. Of course they do; 
they always do what big oil wants. Big oil now, big oil forever. That 
is the Republican motto. Do what they want and nothing else, while 
consumers foot the energy bill.
  We cannot drill our way out of this problem, we know that. We have 3 
percent of the oil and 25 percent of the consumption. We cannot drill 
our way out of the problem. Are there good, constructive ways we can, 
in the short term, increase domestic production? Absolutely.
  I was one of the Democrats who rallied us to drill in the gulf on a 
large tract of oil. There are plenty of places, as my colleague from 
North Dakota talked about, in Alaska, but make no mistake about it, the 
price of oil will not come down until we reduce our dependence on it.
  Democrats are fighting for a new future, not looking at the past, 
finding one little bit of oil here, one little bit of oil there, and 
praying it will solve our problems. We are looking for alternative and 
renewable sources of energy to play a major role in our energy supply, 
freeing us from oil: No more OPEC. The Republican plan would reduce 
dependence on OPEC from 50 percent to 45 or from 60 percent to 55. It 
is not going to do a darn thing. Particularly, every bit of new oil we 
find here--and I hope my colleagues will say all the new oil we find 
here should be used only in the United States. But China and India will 
consume far more than we find in the next 10 or 15 years.
  Let me say this: There will be more new cars in China and India in 
the next decade or so than we have cars in America. We cannot drill our 
way out of the problem.
  I understand my colleagues' desire for their program. It helps big 
oil. That is what we have done all along when the Republicans have been 
in charge. Big oil now, big oil forever. America knows that is not 
going to work. We are in a new world where there is not enough oil to 
meet our needs.
  What are we doing on our side? We are for increasing domestic 
production in the short term in a rational way, but we are not 
depending on it. It is not the main part of what we are talking about 
because we know that will simply lead to higher oil prices. It will 
never reduce the cost of oil enough to bring relief to the American 
family.
  What should we be doing? What are Democrats proposing? We are 
proposing reducing our dependence on oil and foreign oil in particular. 
We are proposing incentives for alternative energy--wind and solar. T. 
Boone Pickens, a big oilman, says we cannot drill our way out of the 
problem.
  We are proposing dramatic changes in our automobiles. You can have an 
electric car that drives just as far and long as a gasoline-driven car 
and rides more smoothly with the same power and the same torque. Why 
aren't we pushing that? Big oil companies don't want it. They won't be 
selling those batteries. The big oil companies don't want wind power or 
solar power. They are not involved in those issues.
  The head of ExxonMobil told our Judiciary Committee a year and a half 
ago that they do not believe in alternative energy. Of course they 
don't. They are making record profits, and the greater demand and the 
less supply, the higher their profitability.
  We have tried in the past to reduce dependence on oil. We have a 
renewable portfolio standard so our utilities will not just depend on 
oil and fossil fuels. We have tried to push tax changes, take the tax 
breaks away from big oil and give them to wind, solar, bio, thermal, 
and cellulosic ethanol. Again, we are blocked by the other side of the 
aisle. In other words, if big oil wants it, that is good, says our 
colleagues. If big oil is against it, we are against it. We will come 
up with some reason.
  But what we will be doing on this Energy bill is looking at the 
future, not at the past. What we will be doing on this Energy bill is 
recognizing that 10 years from now, demand in America should go up for 
energy because we have to grow, but it cannot come from oil. What we 
are looking at is a future where our cars do not need gasoline. We are 
looking at a future where our homes are powered by the Sun and the wind 
and other more natural forces. We are looking at a future where we 
conserve, an issue of passion to me.
  In 1978, California passed building standards to increase energy 
efficiency in homes and buildings. Do you know California has the 
lowest per capita consumption of energy--even with all their car use--
in these United States? It is not New York with our mass transit; it is 
California because so many of their buildings are now efficient. Forty 
percent of the energy we consume goes into heating and cooling 
buildings, 35 percent into gasoline, of total energy consumption.
  I have been advocating that we adopt California standards nationwide. 
It is a rather painless way to go. Where are we? It is not going to 
produce results in 6 months, but it sure will in the next several 
years. California has led the way.
  Why don't we do the same for appliances? Why don't we do the same for 
utilities and require them to be more efficient? We cannot be 
profligate. We can grow and live better and consume less energy at the 
same time.
  There are so many breakthroughs about to occur, and we should be 
encouraging them with Government policies and tax breaks, and instead 
we hear from the other side: Do what big oil wants; just drill.
  The bottom line is we cannot drill our way out of the problem, I say 
to my colleagues, we cannot, and we must have an energy policy that 
looks at the future.
  In conclusion, I say this: Republicans equal big oil equals the past. 
Democrats equal alternative energy. We are the future.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Wyoming.
  Mr. BARRASSO. Mr. President, I rise today to speak about the price of 
gasoline and diesel fuel, a price that is affecting all Americans. High 
prices at the pump challenge many Americans who travel great distances 
for work, for school, or to shop for groceries. This is especially 
acute in sparsely populated States such as Wyoming.
  These prices are resulting in dramatic impacts to our economy. 
America is now importing more than 65 percent of the oil we consume. We 
are sending hundreds of billions of dollars overseas to foreign nations 
that are not necessarily our friends.
  It is well beyond time for Congress to act and to adopt meaningful 
short-term, medium-term, and long-term solutions. As a matter of 
principle, I believe the Senate must act on a set of solutions rather 
than pursue a piecemeal approach.
  I am an original cosponsor of two pieces of legislation that include 
a range of solutions--S. 2958, the American Energy Production Act, and 
S. 3202, the Gas Price Reduction Act. Combined, these bills include 
provisions on advanced technology, on speculation, and on added supply. 
The bottom line is, we need to find more and use less.
  Today, I wish to speak on two points. One is limiting market 
speculation, and the other is increasing domestic production.
  Based on a range of testimony, it is clear to me that there is 
dramatic disagreement on the extent to which excessive speculation 
contributes to the runup in oil prices. As a physician, I am quite 
concerned that some may have misdiagnosed the energy crisis. In my 
view, it is a classic misdiagnosis where policymakers focus too much 
attention on the symptoms of the predicament rather than the underlying 
causes of the problem.
  I am absolutely convinced that the fundamental issue here is one of 
supply and demand. Simply because market speculation is a symptom of 
that larger problem does not mean we should shy away from addressing it 
head-on. Dealing with speculation, however, is not the full answer. We 
must combine these efforts with meaningful action to expand domestic 
supplies and to encourage conservation and energy efficiencies.

[[Page S6997]]

  On the issue of market speculation, I have concluded three 
fundamental points: One, American consumers should not bear the burden 
of those who seek to manipulate markets. Two, the United States should 
not push our financial services trading to foreign countries. We should 
not replace excessive speculation with excessive regulation. And three, 
we should strengthen the futures trading markets. This can be done 
through investing in additional research, requiring transparency, 
putting more cops on the beat, and strengthening requirements on 
foreign boards of trade.
  Efforts to address market manipulation require a careful balance. 
Increased visibility into transactions must not turn into onerous 
regulations.
  More importantly, steps to curtail speculation must be combined with 
real solutions to address the underlying fundamental of domestic supply 
and demand. We must insist on efforts to increase our energy supplies, 
promote conservation, and encourage energy efficiencies. We would be 
failing the American people if we did not talk about increasing the 
domestic supply of energy.

  I must comment on proposals to punish companies that some believe are 
not developing leases as quickly as they should. This is a ludicrous 
argument. Frivolous lawsuits and substantial administrative hoops 
dramatically delay oil and gas exploration and production even on valid 
existing leases. These punishing tactics being proposed are akin to 
leasing an apartment, only to have your landlord withhold the keys and 
complain about why you haven't moved in yet. Rather than punishing 
existing operators, we can and should streamline the permitting 
process.
  Recently, I was in the part of Wyoming known as the Powder River 
Basin. It is in the northeastern part of the State. I heard firsthand 
about the obstacles people are facing when they try to find more oil 
and gas. American producers are routinely faced with rules and 
regulations that limit drilling for one reason or the other.
  Typical restrictions are related to both occupancy of the land and 
the time during the year American producers can operate. Examples of 
prohibitions include extensive restrictions for bird roosting, for bird 
nesting, for migration, and for wildlife feeding.
  The seasonal prohibitions currently limit exploration to a small 
fraction of the year in many areas. As we can see from this chart, some 
areas are off limits to produce for all but 10 weeks of the year, from 
August 16 through October. This is the only time of the year they can 
produce. If this calendar represented the blackout dates for using our 
frequent flier miles rather than the dates blacked out for finding the 
energy that powers our airlines, I guarantee you that outraged citizens 
all across this country would be pounding down the doors. Let's take a 
look. January blacked out. February blacked out. March blacked out, 
April--go through the calendar--May blacked out, June, July. And the 
charge from the other side of the aisle is that companies are not 
producing on their leases fast enough.
  The bottom line is, there are many reasons why there may not be 
active exploration and production on lands already under lease. If 
Congress is serious about producing oil on existing leases, then 
Congress needs to critically review the process needed to develop oil 
and gas wells.
  As of late June in Wyoming's Powder River Basin, there were 2,589 
applications to drill that were awaiting approval by Federal 
bureaucrats. These are on land where the company has already paid for 
the lease but is not yet permitted to drill. They have paid the rent, 
but they have not yet been given the keys to move in.
  The vast majority of the applications face extensive administrative 
delays. What is the current law? The current Federal law requires that 
permits be either issued or deferred within 30 days of the day the 
Government receives the completed application. That is right, the law 
says Federal bureaucrats must give an answer in 30 days. Well, there 
are many instances where there is not even the acknowledgment that the 
submitted application was received. Moreover, the applications sit for 
months and months, in some cases even over a year, and still Federal 
bureaucrats have not processed the application to drill.

  In a small provision that was slipped into this year's consolidated 
appropriations act, these production companies now have to, in addition 
to all the paperwork, pay $4,000 every time they request a permit to 
drill--a permit that is on land that they have already leased and paid 
for, a permit that is not being processed in a reasonable, timely 
manner, and a permit that may not be processed for months or even 
years.
  There are over 850 drilling permits, just in Wyoming, that have been 
specifically delayed due to policy development, environmental delays, 
and even litigation. For people to say that oil and gas operators are 
sitting on leases without any intent to drill is intentionally 
misleading. In my State, the producers want to drill and they are 
waiting to drill. They are simply waiting for the Government traffic 
cops to give them the green light.
  For people who claim they want to increase domestic supply of energy 
on leases that have already been paid for, there is a place you can 
focus your effort. Focus on the thousands of permits nationwide, and 
especially in my home State--permits that have not yet been granted, 
permits that are being held up while waiting for the Government 
bureaucrats to act. The leases have been paid for, the workers are 
ready, and literally, today, standing by ready to work. All we are 
waiting for now is for the Government paperwork.
  This is no way to run a country.
  I yield the floor, and I suggest the absence of a quorum.
  The ACTING PRESIDENT pro tempore. Will the Senator withhold his 
request for a quorum?
  Mr. BARRASSO. I will withhold the request.

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