[Congressional Record Volume 154, Number 121 (Wednesday, July 23, 2008)]
[Senate]
[Pages S7095-S7124]
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.
  The bill 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, the time 
until 4 p.m. will be equally divided, with the Republicans controlling 
the first 30 minutes and the majority controlling the next 30 minutes 
and alternating in that fashion thereafter.
  The Senator from Utah is recognized.
  Mr. HATCH. Mr. President, I sat and listened to this exchange, and it 
is

[[Page S7096]]

amazing to me after 32 years in the Senate that they want to bring up a 
bill and allow their bill and one substitute amendment that they know 
will fail, where there are components of that substitute amendment that 
they know will pass and will help us to find some oil and alleviate 
some of the pressures we have in this country.
  I wish to address the legislation under consideration in the Senate 
today, the speculator bill.
  Here we are, the Congress of the greatest Nation in the world, facing 
a national energy crisis, a crisis that affects every single American, 
the American economy, and America's place in the world, and this is the 
best we can do, this speculator bill? This is our answer, another 
proposal that will not produce one drop of oil or hardly any energy? It 
will not produce any energy. Frankly, I am embarrassed for this body 
and for the people we represent.
  At some point, I wonder when the leaders of the Democratic Party will 
wake up and realize that blaming and taxing the energy industry does 
not equate to an energy policy. It is an anti-energy policy. Finding 
someone to blame is no substitute for finding more oil. And the answer 
to getting America to use less oil is not always more taxes and more 
mandates.
  We are a country of addicts in that sense. The seeds of our addiction 
to foreign oil have been sown here by an anti-oil Congress. If Members 
of Congress are hunting for some of the blame, they are in luck because 
the blame begins and ends right here under the Capitol dome.
  It is very clear that the most extreme environmental groups have an 
anti-oil agenda, and it is just as clear that the Democrats have 
adopted that agenda as their energy platform. It is a recipe for 
disaster, and America is reaping the whirlwind as a result.
  Some are arguing for more solar, wind, and geothermal as an answer to 
high gas prices. I sponsored the current tax incentives for renewable 
electricity, and I hope my actions speak to my support for renewables. 
That is law now in the 2005 act. I know enough about energy to 
recognize trains, planes, automobiles, and ships do not run on 
electricity. They run on oil right now.
  This first chart is solar, wind, and geothermal. They are not 
transportation fuels. Biofuels is still only 3 percent of 
transportation fuels, and yet that is the only other major alternative 
to oil at the present time. We rely on oil for 97 percent of our 
transportation needs, and the other 3 percent is made up mostly of 
biofuels, especially corn ethanol. I have strongly opposed the current 
ethanol mandate, but I have long supported free-market incentives for 
ethanol. In fact, I sponsored the CLEAR Act, as I mentioned, which is 
the current law giving tax incentives for E85 fuel and E85 
infrastructure. We need as much ethanol as we can make, and I am all 
for it. But I also recognize that ethanol has so many inherent 
limitations that it will not be able to break us free from our 
dependence on foreign oil.
  The fact is that we will have to tap into our Nation's gigantic 
resources of oil shale or we will remain addicted to foreign energy 
traffickers for the long haul. They are afraid to have a separate 
amendment up on oil shale because we should win that amendment. Anybody 
with brains would vote for it. There are 3 trillion barrels of oil in 
Colorado, Wyoming, and Utah, in oil shale, about 2 trillion of which is 
estimated recoverable--more oil than all the rest of the world 
combined. If we don't tap into those resources, we are going to remain 
addicted to foreign energy traffickers for the long haul.
  When the Republicans controlled Congress in 2005, we passed a very 
bipartisan energy bill which promoted each of these very necessary 
unconventional oil resources, along with alternatives, renewables, and 
conservation. When the Democrats took over Congress, they immediately 
began dismantling every effort to develop oil from oil shale, oil 
sands, and coal-to-liquids even though they knew full well that we have 
more oil in those resources than all the rest of the world combined.
  Chart 2 says world oil reserves are 1.6 trillion barrels. Recoverable 
U.S. oil shale is between 1 and 2 trillion barrels of oil.
  In most cases, an addiction brings about financial ruin. Democrats in 
Congress have made a lot of noise about the tens of billions of dollars 
we spend each year on the war on terror, but apparently it does not 
bother them as much that our citizens send more than $700 billion every 
year to foreign governments to feed our addiction, some of which are 
not even friends; in fact, some of which are enemies. Congress's 
lamebrained anti-oil actions have put our people at the mercy of 
foreign governments that are smart enough to produce their own energy--
something we could do if they would open this bill to amendment. We are 
selling away our Nation's place in the world and funding the rise of 
our most aggressive competitors and even our enemies.
  Of the major world oil shale resources, we hold 72 percent of the 
total. We can see Israel, Estonia, China, Australia, Morocco, Jordan, 
Brazil, United States, and the total world. Did you know, Mr. 
President, that China and Brazil have been smart enough to produce 
their own oil from oil shale for decades--China and Brazil--and that 
Estonia has produced oil from oil shale for over 90 years? We act as if 
we cannot do it. My gosh, of course, we can do it. Did you know the 
United States controls more than 70 percent of the world's known oil 
shale resources? Yet we are stopping its development because of their 
anti-oil agenda over there, and that is what is involved here, trying 
to cover it up with a so-called speculators bill that all of us will be 
glad to have in a final bill, but that does not produce one drop of oil 
to help our problems.
  Is it because our industry cannot compete or is it unwilling to 
invest in oil shale production? They most definitely are willing, but 
the sad fact is that our own Government owns most of the oil shale in 
the United States and our own Government has said no because of these 
people over here.

  The biggest argument I keep hearing against oil shale development is 
we cannot allow the Government to even establish rules for oil shale 
development because we just plain don't know enough about it yet. Think 
of Estonia: For 90 years, they have been producing oil from oil shale. 
Think of Brazil: For decades, they have been producing oil from oil 
shale. You think the greatest Nation in the world can't do it? We don't 
know how much water it will use; we don't know how much wildlife 
habitat it will use, they say; we don't know about the greenhouse gas 
footprint. Guess what. The Department of Energy has been studying oil 
shale for decades, and we have a pretty good idea about each of those 
questions.
  Why do the Democrats say no to oil shale production? I hear some say 
they are concerned about water use. Let's take a look at water use 
compared to ethanol.
  Mr. President, did you know oil shale uses less water than ethanol, 
no more than gasoline? Right now, corn does not rely on irrigation, for 
the most part. However, if we hope to increase ethanol's share of the 
fuel supply, we will have to move into drier areas that require 
irrigation.
  Look at the water use. Ethanol takes 4 to 5 barrels of water and 
1,000 barrels of water on irrigated lands. Oil shale, for the entire 
process--processing, upgrading, and land restoration--three barrels of 
water. A September 2007 article in Southwest Hydrology states that 
irrigated corn requires well over 700 barrels of water for each barrel 
of ethanol. A barrel of ethanol has about 30 percent less energy than a 
barrel of oil. In other words, to make just 1 oil-equivalent barrel of 
ethanol, it would take over 1,000 barrels of water. The Department of 
Energy reports that oil shale, for the entire process, including land 
restoration, would require just three barrels of water for every barrel 
of shale oil, about the same as gasoline.
  Let's compare how much water it would take to make enough ethanol to 
produce 20 percent of our fuel with the amount of water it would take 
to produce the same amount of oil shale. Look at what it would take. 
Look at the red, ethanol. We can hardly see the red of the water 
required for oil shale. We would need about 64 cubic miles of water to 
produce that much ethanol and only .17 cubic miles of water to produce 
the same amount of oil shale.
  It is time we stop confusing oil shale with Canadian oil sands. They 
require

[[Page S7097]]

completely different processes. Canadian oil sand production uses a lot 
of water and a lot of steam to produce oil from oil sands. With oil 
shale, you apply heat directly to the rock. The last thing you want in 
your process is water. They are very different, so let's stop 
pretending they are the same thing. And let's remember Estonia and 
Brazil. Isn't this country as good as them?
  The other red herring often raised against oil shale is concern about 
land use and wildlife habitat. Mr. President, did you know that oil 
shale uses much less land than either ethanol or gasoline? One acre of 
corn produces 7 to 10 barrels of ethanol. One acre in the oil patch 
produces about 10,000 barrels of oil. One acre of oil shale produces 
between 100,000 and 1 million-plus barrels of shale oil. That is right, 
on average, 1 acre of oil shale will produce around 500,000 barrels of 
oil.
  So those who are truly concerned about land use and wildlife habitat, 
let's look at how much land it would take to make enough ethanol for 20 
percent of our fuel supply compared to the same amount of oil shale.
  With regard to that green spot in the middle of this chart, it would 
take those five States to produce 20 percent of our energy needs from 
ethanol. Think about that. Producing 20 percent of our oil from oil 
shale would take the equivalent of the smallest county in Kansas being 
in production at one time, and as each oil shale acreage is used, it 
would be restored to nature, according to the very strict mining and 
gas laws already on the books. It is environmentally sound as well.
  We are learning that land use is very important, and not just in 
terms of wildlife habitat and watershed protections. Scientists have 
determined that disturbing land for activities such as cultivating corn 
and switchgrass, or any other crop, releases a giant amount of 
CO2 into the atmosphere.
  Look at this chart. Oil shale without carbon capture, 7 percent more 
than gasoline, but switchgrass for ethanol, including land use, is 50 
percent more than gasoline. Greenhouse gas emissions for corn ethanol, 
including land use, is 93 percent more than gasoline. Oil shale is much 
more environmentally sound from the get-go.
  Even taking into account that burning ethanol is an improvement over 
gasoline, the researchers discovered that when land disturbance is 
calculated, corn ethanol emits 93 percent more greenhouse gases than 
gasoline. Thank goodness for switchgrass, our new hope for the future 
of biofuels. The problem is that the same study calculates that 
switchgrass, even when grown on existing corn land, produces 60 percent 
more carbon emissions than gasoline. The Department of Energy 
calculates that oil shale production emits only 7 percent more 
greenhouse gases than gasoline, and that is without any carbon capture 
technology, which many in the industry plan to use.
  Whether your concern is carbon emissions, water use, or wildlife 
habitat, oil shale is a better answer than ethanol. And when it comes 
to transportation fuels, ethanol is the only alternative of any real 
significance today. The fact is that I am for it, but let's not get 
confused on which one is more efficient and better. I am certainly not 
here to bash ethanol. I still believe we should produce as much as 
possible, but ethanol is the only current significant alternative to 
transportation fuels available today. It is important that we start 
dealing in realities around here and not just political puffery, is 
what we are hearing from the other side.
  To be honest, when it comes to energy policy, it is like never-never 
land on Capitol Hill. On the one hand, we pass a giant mandate on top 
of giant incentives to produce ethanol, with all its limitations. On 
the other hand, we ban oil shale production which would give our people 
access to almost unlimited amounts of cheap energy. The oil shale 
industry is not asking for any mandates, environmental loopholes, or 
subsidies. They simply ask to have access to the Federal Government's 
vast oil shale resources.
  I have no problem with debating the impact of speculation on oil 
prices. It is something we ought to be discussing. I have no problem 
with that. But it is not going to produce one drop of oil. It is no 
substitute for providing our people with the transportation fuels they 
need, and we will never accomplish that goal until we find more and use 
less.
  Our goal as Republicans is to amend this bill so we can find more oil 
and use less of it so that we can solve our problems as we go into the 
future, where we get into not only hybrids but plug-in hybrids, 
electric motors, fuel-cell motors, hydrogen cars and, of course, 
nuclear, wind, solar, thermal, and geothermal. We have to do all of 
that. But until we can really move down that line, we have to have oil 
to run our transportation needs.
  I yield the floor.
  The PRESIDING OFFICER (Mr. Brown). The senior Senator from Tennessee 
is recognized.
  Mr. ALEXANDER. Mr. President, will you let me know when I have 
consumed 9 minutes, please?
  The PRESIDING OFFICER. The Chair will notify the Senator from 
Tennessee.
  Mr. ALEXANDER. Thank you very much.
  Mr. President, I listened to the Democratic leader discuss the 
legislative calendar. With respect, I believe the Democratic leadership 
in the Senate is approaching the crisis of $4 gasoline with all the 
urgency of naming a post office. It seems their idea is to talk until 
there is one amendment over there and one amendment over here, both of 
which may fail, and then go on to the next thing.
  I have just come back from 4 days in Tennessee. I believe that if I 
walked down the street in Nashville or Maryville or Knoxville or 
wherever and talked to 100 people and said: What do you think we ought 
to be doing in the Senate? I would get the same answer. It would be 
this: We would like for you to go do something serious about $4 
gasoline prices and we would like you to work across party lines to get 
it done.
  We are ready to do that, we on the Republican side, and I think many 
Democrats are as well. Yet what the Democratic leadership did was bring 
up a bill on Friday that addresses oil speculation and put us in a 
procedural situation where all we can do is talk and talk and talk. We 
could have started last Friday with amendments on finding more oil and 
using less oil. We have 25 or 30 on this side. I will bet there are 
that many on the other side--I will bet there are more than that. We 
could be on our fifth day of debating and voting on a substantial piece 
of legislation to increase the supply of American energy and reduce our 
use of oil, which is the way to lower gasoline prices. That is what we 
should do today. If we do not do it today, we should do it tomorrow. We 
should not stop until we get it done. That is why we are here. That is 
what the American people expect of us.
  The majority leader has brought up a bill about speculation. There is 
nothing wrong with that. It is his right to do that. We recognize that, 
because in the Republican bill we offered, we suggested we would find 
more oil by drilling offshore and giving States the option to do that 
on their shores, and by lifting the moratorium from oil shale final 
regulations--that would increase American production of oil by a third. 
That is substantial. We are the third largest producer of oil in the 
world. That may help affect prices. On the other side, we want to use 
less oil, and we would do that by making plug-in cars and trucks 
commonplace, cars and trucks powered by electricity, which would reduce 
our use of oil. If we did those three things on the find more and use 
less side, we could cut our use of imported oil in half over time, 
which would stop sending about $250 or $300 billion a year overseas to 
other countries, some of which are paying terrorists who are trying to 
kill us.
  But oil speculation has its limits. Oil speculation is a part of our 
bill. We believe we should put 100 cops on the block. We need more cops 
on the block who are commodities regulators. We need to find out more 
about these new financial instruments and the effect they might be 
having on the price of oil. But you cannot deal with oil speculation 
unless you deal with supply and demand.
  The Interagency Task Force on Commodity Markets has been studying 
this question for 5 years. They said today--I heard it on National 
Public Radio because I drove in early--their interim report on crude 
oil studied fundamental supply and demand factors and

[[Page S7098]]

the roles of various market participants, and it found that ``the 
fundamental supply and demand factors provide the best explanation for 
the recent crude oil price increases.'' That is what the Government 
says.
  Here is what a private sector individual, who has been pretty 
successful, says--Warren Buffett: ``It is not speculation, it is supply 
and demand.''

  We can deal with oil speculation. We have proposed doing that in the 
Gas Price Reduction Act. But saying that by passing a bill on oil 
speculation we deal with $4 gas would be like saying we are passing a 
bill on thirst without dealing with water. We have to move on to supply 
and demand. That is why we say we should be finding more and using 
less.
  In Tennessee yesterday, Nissan announced that it was entering into an 
agreement with the State of Tennessee and the Tennessee Valley 
Authority to make our State hospitable for a pure electric car that 
Nissan intends to have on the market for fleets by 2010 and for 
individuals by 2012. According in Nissan's plans, the car will go 100 
miles without having to be recharged. Carlos Ghosn, the president of 
Nissan and Renault, wants a zero emissions or an emissions-free car on 
the market. He wants counties and mayors who want that to be able to 
have it in their fleets.
  That is part of the Gas Price Reduction Act proposal. We understand 
we have to reduce demand as well as increase supply. But the other side 
is stuck on using only half of the law of supply and demand. They have 
forgotten economics 101. We say offshore drilling. They say no, we 
can't. We say oil shale. They say no, we can't. We say five or six new 
nuclear powerplants a year so we can have clean electricity for our 
plug-in cars and trucks. They say no, we can't.
  We say bring up gas prices and put it on the Senate floor and let's 
stay here until we finish. I heard all this talk about the legislative 
calendar. The legislative calendar isn't more important than the family 
budget. The legislative calendar is not more important than the family 
budget, and what is breaking the family budget today is gasoline 
prices. Four-dollar gasoline is driving up the price for fueling our 
cars and trucks. It is driving up the cost of food because, as we know, 
energy is such an important part of agriculture.
  People are hurting. Every week, I am on the floor reading e-mails 
from Tennesseans who are canceling their vacations, losing their jobs, 
unable to go get medical treatment because they cannot afford the price 
of gasoline. What are we doing? We are talking when the Democratic 
leader could instantly put us into a situation where we could spend a 
week or 10 days considering two or three dozen good amendments, vote 
them up or down, and see if we could work across party lines to come to 
a result.
  Will we solve every problem in a week's debate in a bill we pass 
before August? No, of course not. We really should be on the path 
toward clean energy independence. I suggested in May that we need a new 
Manhattan Project, like the one we had in World War II for the atom 
bomb, where we have a crash program for 5 years on the things we don't 
know how to do, such as make solar power competitive with fossil fuels 
or reprocess nuclear waste so it can be stored more easily or make more 
new buildings green buildings or advanced research on biofuels--crops 
we don't eat.
  But there are some things we know how to do today. Mr. President, 85 
percent of the Outer Continental Shelf, where we have the opportunity 
to produce oil and gas, is, by congressional action, off limits today. 
It was off limits according to the President's action too, but he 
changed the Presidential order last week. What happened? The price of 
oil went down. I don't know exactly to what extent the President's 
action had an effect on the price of oil, but I do know this: If we 
were to take action today on supply and demand, the price of gasoline 
today would stabilize and begin to go down because today's price is 
based upon the expected supply and demand 3 to 5 years from now. If we 
demonstrate in our proposal, as our proposal says, that the United 
States of America, which consumes 25 percent of all the energy in the 
world, is prepared to increase our production of oil by a third and 
reduce our use of oil by a sixth, that together would reduce the supply 
of imported oil; it would cut it in half. If we did that today, it 
would affect the price of oil today.
  Our solution is four words: Find more, use less.
  The ACTING PRESIDENT pro tempore. The Senator has used 9 minutes.
  Mr. ALEXANDER. Find more, use less. We believe in both parts of the 
supply and demand. The other side is dancing around. I think they have 
badly misjudged the American people and the urgency of this question. 
We need to do everything we can in the next week or so to fashion a 
bill that takes a substantial step toward increasing the supply and 
reducing demand for oil--not saying no, we can't; no, we can't; no, we 
can't. We can say yes, we can, to finding more and using less, and the 
American people expect us to do that. That is why we are here. We can 
start today.
  The PRESIDING OFFICER. The senior Senator from Missouri is 
recognized.
  Mr. BOND. Mr. President, I ask unanimous consent to be permitted to 
speak in morning business for up to 7 minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BOND. Mr. President, America is suffering a gas price crisis. In 
response, our Democratic colleagues are blocking our attempts to get 
gas prices down for new oil supplies. Yesterday, Senate Democrats went 
so far as to cancel an Appropriations Committee markup over fears that 
an amendment to open offshore oil production would succeed.
  Senator Hutchison of Texas and I had announced our intention to offer 
an amendment to rescind the continuing moratorium in appropriations 
bills that currently blocks new oil production off our Atlantic and 
Pacific shores. With the support of Senators Domenici, Alexander, and 
all the committee Republicans, we would have given the Appropriations 
Committee a chance to reverse the annual law blocking America from new 
oil supplies. I suppose they were afraid we would win the vote, and 
that is why they canceled the meeting. How undemocratic can you get? 
You are afraid to lose a vote? Cancel the vote.
  We have been struggling all year with Democrats blocking Republicans 
from offering amendments on the Senate floor. Democrats are saying 
currently that they will block Republicans from offering amendments to 
lower gas prices by increasing oil production. Afraid to vote on the 
floor? Block the vote. Cancel the vote. Block the vote.
  What is next? Will Democrats try to disband the Senate or have the 
majority leader act as a Rules Committee so only what he says can be 
voted on on the floor? That is not the way this Senate acts.
  Why is this so hard? Why are Democrats so desperate to deny the 
relief the American people need and are demanding? Maybe things are 
different in New Jersey, Illinois, Nevada, and California, but I can 
tell you Missouri families are struggling with record pain at the pump. 
Not just families, Missouri truckers and small businesses and 
charitable institutions and local governments are suffering from 
record-high prices. Diesel prices are driving truckers out of business. 
Missouri farmers are fed up with high energy costs. They do not need to 
hear, as our Presidential candidate from Illinois said, that the 
problem is not that gasoline prices have gone up; the problem is they 
went up too quickly. I can tell the Senator from Illinois that the 
people of Missouri are fed up with both the speed and the level of gas 
price increases. Four-dollar gasoline is as popular in Missouri as a 
Belgian company trying to buy out Budweiser.
  Missourians know this is a fundamental problem. We all learned it in 
economics 101. Prices are high because there is not enough supply to 
meet demand. We need to find more and we need to use less. There is 
plenty out there to find, if only they will allow us to go and get it.
  We have heard the numbers before, but let me repeat them again. At 
least 18 billion barrels of oil are waiting for us in the waters off 
our Atlantic and Pacific shores. That is 10 years of supplies we can 
give ourselves. Republicans plan to add 10 years of new supplies versus 
a Democratic plan to open the Strategic Petroleum Reserve, which would 
give us, by that rate, 3.5 days more oil supply.

[[Page S7099]]

  Today's new Democratic half measure--it is not even a half measure, 
it is not a quarter measure, it is not an eighth measure--is to swap 
sweet crude for heavy crude in the Strategic Petroleum Reserve, again 
to get a little more gasoline when the oil is refined. It still takes 
refining capacity. It is still a Band-Aid that is not even well placed 
over the wound.
  These Democratic ideas for ``new supplies'' keep getting smaller and 
smaller, weaker and weaker. They say: Well, drill where you have 
leases. It is called exploring. And when you explore, you did not find 
something, you do not drill, it goes back to the Government. That is 
already the law. Give us a break.
  At prices as they are today, if there is oil out there, if they see 
an opportunity to get it, the oil companies are going to go after it, 
because that is how they make money. That is how they make the money 
they invest in developing more oil supplies.
  We are not forgetting that the biggest thing we can do, the boldest 
thing we can do, the most aggressive thing we can do is to increase 
domestic oil supply. And that is exactly what we will need to end this 
gas price crisis.
  Yes, there are other things--using less. I come from a battery State. 
We need a major American battery manufacturer, because right now most 
of the batteries coming in for hybrid and hybrid plug-in cars come from 
Asia. We need to put Americans to work in a large facility or 
facilities making batteries that will run electric cars.
  These are the big ideas. American people do not deserve small 
Democratic ideas. They do not deserve modest Democratic ideas. They do 
not deserve timid Democratic ideas. The American people deserve bold 
action, the American people deserve aggressive action, the American 
people deserve real action. It is time we get real about gas prices.
  We need to stop putting offshore oil off limits. Give us a vote to 
open more offshore oil production. That is what we propose. That is 
what we demand. That is what the American people deserve. We cannot 
fulfill our duty to the American people by walking away from half a 
loaf, a half a small loaf solution without giving the American people 
the right to see where their elected Senators are going to vote in 
terms of providing the big relief we need for a big problem. We need to 
have votes and we need to move on that oil bill.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Washington State is 
recognized.
  Ms. CANTWELL. Mr. President, unless we change course, our Nation will 
soon be sending $1 trillion a year abroad to purchase foreign oil, and 
no amount of drilling is going to change that. That is why I am 
frustrated that we are wasting valuable time here on the Senate floor 
debating last century's policies instead of talking about tomorrow's 
solutions.
  We know that today we are facing an oil crisis, but we also know that 
with less than 2 percent of the world's oil reserves, there is no way 
the United States is going to drill its way out of this quagmire. 
American families and businesses are depending on us to put aggressive 
new policies in place, not continue to dwell on the old policies that 
are not going to provide any relief at the pump.
  Unfortunately, it seems as though there are some who only want to 
focus on big oil's top priority; that is, lifting the moratorium on 
Outer Continental Shelf drilling.
  Pro-drilling advocates, and certainly the President of the United 
States, seem perfectly comfortable perpetuating what I think is a cruel 
hoax on the American people saying that drilling will lower oil prices. 
They are willing to imply, to insinuate, and to pretend that drilling 
off of our coastlines will somehow provide relief at the pump or 
somehow lessen our dangerous dependence on foreign oil.
  The reality is even the biggest drilling advocates admit that opening 
our Nation's pristine coastlines will have no impact on pricing at the 
pump. That is right, no impact.
  In fact, the President of the United States, on June 15, said:

       I readily concede that, you know, it is not going to 
     produce a barrel of oil tomorrow, but it is going to change 
     the psychology.

  My colleague who is running for President seemed to say a similar 
thing:

       I do not see any immediate relief, but even though it will 
     take some years, the fact that we are exploiting these 
     reserves would have a psychological impact that I think is 
     beneficial.

  According to the Los Angeles Times, a senior adviser for Senator 
McCain also acknowledged in a news conference in a call to reporters 
that:

       New offshore drilling would have no immediate impact on 
     supplies or gas prices.

  In fact, the White House went on to say the same thing:

       There's not a real good short-term answer to high oil 
     prices, and we've been very explicit about that from the 
     beginning.

  So I think it is safe to say many people are confused about what is 
being discussed here on the floor.
  Another White House spokesman said:

       Anyone out there saying that something can be done 
     overnight or in a matter of months to deal with the high 
     prices of gasoline is trying to fool people.

  Now, this is from the same White House and Republicans that are now 
advocating that maybe there is a psychological advantage here that 
somehow supply that we will not see until 2030 could have an impact on 
gas prices today.
  Well let me tell you what some energy experts told the Energy 
Committee's roundtable on oil prices Roundtable this past week. And for 
those of you who did not attend--we had many of our colleagues attend--
we had two expert witnesses, Daniel Yergin, the chairman of Cambridge 
Energy Research Associates, an author of a very well-known book about 
oil, and Roger Diwan, an energy analyst at PFC Energy. They both firmly 
rejected the notion that the President's announcement he was breaking 
the Outer Continental withdrawal moratorium somehow caused a drop in 
oil prices. They were asked that question and basically laughed at the 
suggestion that lifting the moratorium could cause a drop in oil 
prices.
  For those who want to pretend that opening up drilling could have any 
psychological effect, I think this chart illustrates what is going on. 
We see here on the left that prices are forcing Americans to basically 
consume less. Basically they are using 800,000 fewer barrels of oil 
than we did this time last year. But that certainly has not had a 
psychological impact on the price. We know that Saudi Arabia, here in 
the middle, announced that they were going to increase output by 
500,000 more barrels a day. That announcement did not have any 
immediate impact. In fact, we saw oil prices surge to $140 a barrel.

  So the lesson here is that even though these are significant 
reductions in demand and increases in supply happening it is not 
impacting world old price. So how can some of my colleagues argue that 
by producing 200,000 barrels a day, which is what the Outer Continental 
Shelf drilling would get you, that somehow that is going to have a 
psychological effect? How can they make that case when this amount of 
reduction of consumption cannot, and this amount of new supply did not; 
that somehow by producing 200,000 more barrels per day in 2030 is going 
to magically reduce prices today. I think what is clear is it does not 
matter how many oil fields we have, or how many holes we poke in the 
ground, it is not going to bring down the price. Only by ending our oil 
addiction and providing Americans with real energy solutions can we do 
that.
  I am not the only one who believes that. The administration's own 
Energy Department has said similar things. In fact, in the Energy 
Information Administration's 2007 Annual Energy Outlook they have said:

       Access to the Pacific, Atlantic, and eastern Gulf regions 
     would not have a significant impact on domestic crude oil and 
     natural gas production or prices before 2030.

  No impact before 2030. That is 22 years from now. In 22 years, we 
need to have a significant reduction in fossil fuels or our climate 
will be giving us a lot more things to worry about than the price of 
oil.
  Scientists are now telling us there is a 75-percent chance within 5 
years the entire North Polar icecap will completely disappear in the 
summer months.
  According to Tufts University, doing nothing about global warming 
will cost the United States economy more than

[[Page S7100]]

3.6 percent of our gross domestic product or $3.8 trillion annually by 
2100.
  So why are we talking about taking on all of this risk of drilling in 
the Outer Continental Shelf? For what? We are talking about something 
that is a fraction of the demand of oil the United States is going to 
need in the future.
  In fact, the Energy Information Administration says we will be using 
22.6 million barrels a day in 2030. But the most we would get from the 
Outer Continental Shelf drilling would less than 1 percent of what the 
United States will need in the future. So some of my colleagues have 
staked America's energy future on a proposal that is going to give us 
less than 1 percent of what the United States needs today.
  In fact, the Energy Information Administration continued on this 
discussion and said that drilling in the Outer Continental Shelf and 
lifting the moratorium, that these 200,000 barrels a day would have a 
minimal impact on what the United States needs.
  This particular chart shows you how much additional supply we will 
need, 2 million barrels more a day than we are currently using today. 
And this is what the Outer Continental Shelf will give us, only 200,000 
barrels per day. So it is not exactly as if this is going to help much 
if at all in the future.
  In fact, the Energy Information Office continues to say:

       Because oil prices are determined on the international 
     market, any impact on average wellhead prices is expected to 
     be insignificant.

  That is an analysis of drilling in all the offshore areas currently 
in moratorium. So the math is simple. Even if we drill in every last 
corner of our Nation, we would never be able to have an impact on world 
oil prices. The world price is always going to be set by others, 
leaving a critical aspect of our economy in the hands of OPEC.
  As long as we use a quarter of the world's oil and have less than 2 
percent of the world's oil reserves, facts that no amount of drilling 
can change, our country is vulnerable. It reminds me of the old adage: 
If you are in a hole, stop digging. But some want us to keep digging, 
digging toward a meager 200,000 barrels a day.
  And that 200,000 barrels assumes that drilling off the coast of the 
Atlantic and Pacific is something people will want to do.
  We have already heard from some States that think the risks are too 
great to their economies. For example we will not be able to drill the 
10 billion barrels that are covered under the Federal ban off the coast 
of California, a State where bipartisan opposition exists to further 
drilling.
  Here is what Governor Schwarzenegger said recently:

       California's coastline is an international treasure. I do 
     not support lifting this moratorium on new drilling off of 
     our coast.

  The Governor added:

       We are in this situation because of our dependence on 
     traditional petroleum-based oil. The direction our country 
     needs to go in, and where California is already headed, is 
     towards greater innovation in new technologies and new fuel 
     choices for consumers. That is the way we will ultimately 
     reduce fuel costs and also protect our environment.

  I could not agree with the Governor more.
  Governor Schwarzenegger is not alone in his straight talk because 
there are many citizens across the country from coastal States who also 
know the impact of what oil spills can have, that it can mean billions 
of dollars in economic loss. Ask the tens of thousands of people who 
lost their livelihood after the Exxon Valdez. I know some of my 
colleagues have made remarks that new technology somehow makes spills 
from offshore platforms impossible. I know the minority leader said 
recently there was not a single reported example of spillage in the 
gulf during the Katrina hurricane.
  I respectfully--and I mean respectfully--ask the minority leader if 
he has seen the President's own report on lessons learned from the 
Federal response to Katrina. This is a copy of the cover of the report. 
It says:

       Hurricane Katrina caused at least ten oil spills, releasing 
     the same quantity of oil as some of the worst oil spills in 
     U.S. history.

  There it is. A report that basically says it caused ``ten oil spills, 
releasing the same quantity of oil as some of the worst oil spills in 
U.S. history.''
  The report goes on to say:

       All told, more than 7.4 million gallons of oil poured into 
     the Gulf Coast region's waterways, over two thirds of the 
     amount that spilled out during America's worst oil disaster, 
     the rupturing of the Exxon Valdez tanker off the Alaskan 
     coast in 1989.

  This is a satellite image of the Gulf of Mexico on September 2, 2005, 
right after Hurricane Katrina hit. It shows the various areas of oil 
spills that did, in fact, happen.
  Although there are oil risks, the fact is that most of our Nation's 
recoverable oil supplies and related infrastructure are, for better, or 
worse, in the Gulf of Mexico. That is not to say we can't have 
environmentally responsible oil and gas recovery. In fact, many of my 
Senate colleagues did support in 2006 opening more of the gulf waters 
after President Bush issued a Presidential directive stopping some of 
the drilling that was endorsed by the previous administration. But in 
hindsight, opening the gulf seemed to be another lesson in how we are 
not going to help impact the price. Back when we opened 6 million acres 
in lease 181, many oil companies promised it would have a dramatic 
effect on new production. It was going to be an incredible find. The 
price was at $57 a barrel.
  But a year later the price was already $89 a barrel and we all know 
the price today. Obviously, access to more drilling didn't help us 
impact the price of oil then.
  And with prices so high, why did the oil companies bid on only 200 
million acres of the 500 million acres recently put out for bid in the 
Gulf of Mexico? Not utilizing existing leases seems to be a pattern 
with oil companies. In fact, many oil companies are not using 83 
percent of the public offshore lands they have tied up in leases. That 
is an area larger than the States of New York or Alabama that is just 
sitting idle. This chart shows that 83 percent of the leases offshore 
are not producing energy, and the oil companies are choosing to only 
use this area in the green.
  Why don't we hear more about why they aren't choosing to drill? It 
doesn't make sense, given what the price is. We know one of the reasons 
may be that every single available drill rig, drill ship is being used 
right now. You can't go and drill when you don't have the equipment. 
According to the House of Representatives, oil companies have access to 
over 100 billion barrels of conventional oil in areas not under 
moratorium. That is how much is already there in existence on land that 
can be leased. It is already there. It is already available. But 
clearly the oil companies can't, or it is in their financial interest 
not to, utilize this vast amount of public land they already have.
  The fact is, depending on oil companies to get us out of this mess is 
exactly what has gotten us into this mess. It is not a viable solution. 
We need to break our addiction to oil.
  The question is, What can we do today to help bring supply and demand 
into balance? Last week, Dr. Yergin told us at the gas prices forum:

       If Americans took a few precautionary steps when driving, 
     including properly inflating their tires, demand for oil 
     would decrease by 600,000 to 700,000 barrels per day.

  That is something we can do now, not in 10 years, not 20 years. We 
can do it now. In fact, there are many things we can do now to reduce 
our dependence on oil. More efficient tires is one of them at 300,000 
barrels per day; keeping your car tuned, 400,000 barrels a day; 
commuting with an extra passenger once a week, 200,000; keeping tires 
properly inflated, 200,000; and other ideas. These are things that can 
have an impact today, not like drilling which will only have an 
insignificant impact and only in 2030.
  These are the things we should be working on aggressively. These are 
the low-hanging fruit we should be grabbing. Drivers are desperately 
seeking any measure that they can use to lower prices at the pump. That 
is why the Bush administration should speed up its rulemaking on a 
provision in the 2007 energy bill that established fuel efficiency tire 
labeling. We need a national campaign of public awareness to show 
consumers how to properly inflate their tires. I am for giving away air 
pressure gauges at the stations and making sure there is a national 
education program in place. We can start helping consumers today.
  According to tests by the Consumers Union, choosing the right tires 
and maintaining them with the proper pressure can save consumers about 
$100

[[Page S7101]]

based on today's gas prices. It is critically important we take actions 
such as this that will help consumers, that will give them some relief.
  To me, the debate over drilling highlights a generational change that 
we actually need in Congress. Americans know it instinctively. They 
know many of our institutions and safety nets are not working when it 
comes to this issue.
  Think of what a different situation we would be in if we had spent 
the last 8 years acting more aggressively to build a clean energy 
future that our country desperately needs. For example, we could have 
been investing more in plug-in electric hybrid vehicles, which would 
have had a tremendous impact on oil addiction. The Pacific Northwest 
National Lab found that our current electricity infrastructure could 
support an estimated 70 percent of America's passenger vehicle fleet. 
Seventy percent of our Nation's cars could be supported by today's 
electricity grid, if we would have gotten plug-in hybrids into the 
marketplace. Fully utilizing the grid would displace 6.5 million 
barrels of oil a day, an amount equivalent to 50 percent of what we 
import, and cut our greenhouse gases by 20 percent. That is the type of 
policy we should have been pursuing.
  Juxtaposed to drilling, the 6.5 million barrels of oil plug-ins could 
save is basically 32 times the savings of what the proposal for Outer 
Continental Shelf drilling would be. Obviously, that could have a 
significant impact.
  The study also found that charging a plug-in electric vehicle at the 
current national electricity rate would cost the equivalent of just $1 
a gallon. Instead of paying the fuel prices you are paying today at $4, 
you would be paying only $1 to plug in your car. A car that gets 100 
plus miles per gallon. It would have such an unbelievable impact on the 
American consumer and the economy and opportunity.
  There is a lot more we could have also done in the last 8 years. 
There is much more we could do now in making sure we extend expiring 
clean energy tax incentives that will save $20 billion in clean energy 
investments. I don't think it is too late to get the extender package 
and have 42,000 megawatts of planned renewable energy projects in 45 
States go forward. That is the equivalent of 75 baseload electricity 
generation stations. I hope we can see progress on that bill.

  Passing clean energy incentives will also provide renewable energy 
that will lessen demand for natural gas, lowering household electricity 
bills, to say nothing of what New England is facing with the high price 
of fuel for their homes.
  Also under the Baucus extender bill, consumers can utilize $500 in 
tax incentives for measures that make their homes more efficient. This 
could lower their home heating bills by 20 percent or more. That is a 
huge opportunity for us moving forward, if we would only pass the 
legislation.
  I don't know how much time I have remaining.
  The PRESIDING OFFICER. There is 6\1/2\ minutes remaining on the 
majority side.
  Ms. CANTWELL. I will take a minute or two more.
  These solutions I talked about are solutions we can do now. They are 
near term. If you look at this chart of what options we have for the 
future, this is what drilling and the moratorium can save us in barrels 
of oil by 2030, less than a million barrels a day. Here is what 
efficiency in automobiles and trucks and the measures I described in 
the last few minutes can do in saving us on energy and oil consumption, 
over 6 million barrels per day.
  We have to get off this 27-year debate and get on to an energy future 
that will help make America more secure. We must move faster, further 
past these old energy policies, past convoluted logic and on to an 
opportunity where the United States can become an energy leader. We 
know there are countries that are already doing it. Let's make sure we 
have learned the lessons from our global neighbors about changes they 
have made. Let's commit to a real energy strategy on renewables. It is 
something America deserves and something we need to pass as soon as 
possible.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Virginia is recognized.
  Mr. WEBB. Mr. President, how much time remains?
  The PRESIDING OFFICER. There is 5 minutes remaining to the Senator 
from Virginia for majority time.
  Mr. WEBB. I will do my best. I wish to speak for a few minutes today 
about why I believe it is not only appropriate but important for us to 
be focusing on the issue of oil market speculation, separate from the 
larger issues that confront us in our energy policies, as a way to 
address the most serious problem and the most fixable problem as it 
relates to the high price of oil and the high price of gas. There are 
many on the other side who have commented that speculation is not the 
reason gas prices have gone up so dramatically, that this is simply the 
free market working. I am reminded that when this Congress voted in 
October of 2002 to go to war in Iraq, the price of oil was $24 a 
barrel. It has gone up all the way to $145 a barrel. That is six times 
the cost of oil when we went into Iraq.
  I certainly wouldn't venture that demand has gone up six times in the 
last 6 years, even if we adjust for the devaluation of the dollar 
taking place for a lot of reasons, that demand has gone up in those 
kinds of multiples. I, similar to many on this side of the aisle, would 
like to see a comprehensive energy package, a comprehensive energy 
strategy that addresses all our assets and all the assets we can bring 
to this issue in the future.
  This simply is not the right time. You cannot do this with a series 
of amendments, whether it is for another week or another 2 weeks. You 
can only do that with another serious consideration of a piece of 
legislation that addresses all these different areas. I am among those 
on this side of the aisle who are not opposed to the idea of offshore 
exploration for oil and natural gas and have joined the senior Senator 
from Virginia in a proposal to that effect.
  I would like to see us go into a more serious development of nuclear 
power. We have not had a new nuclear power plant built in this country 
in 30 years. Nuclear power technology has improved. Carbon dioxide 
emissions from nuclear power plants is benign. It is good for the 
environment. It would have a dramatic increase in jobs. These are all 
positives.
  I also would like us to explore, in a proper way, alternative energy 
proposals that have become increasingly popular and increasingly viable 
over the last 20 years. There has been a lot of attention on wind power 
over the past few days because of what Mr. T. Boone Pickens has 
proposed. Solar technology has dramatically increased in its 
capabilities over the past 10 to 15 years.
  I come from a State that produces a lot of coal. I think the answer 
to coal--which is a national asset in this country in terms of the 
supply that is available--when it is used under the right circumstances 
can be environmentally neutral, when we develop the right technologies.
  Those are all issues which should be on the table as we approach a 
full energy strategy in terms of reducing our dependence on foreign oil 
and becoming more energy independent. But they are simply not the only 
issues we should be addressing this week.
  Why is speculation so important? Quite obviously, because as of the 
end of 2000, there are people other than users who have been buying oil 
futures. They have been buying them not for their use, but purely as if 
they were buying stocks. They are doing this in an environment where 
there are no regulations in the same sense as there are in other 
investment areas, the areas that apply to stocks.
  As I said, this policy changed in late 2000, and this is when the 
speculation market began to have these aberrations in it. You can buy 
oil futures for 3 or 4 percent on margin. We have dramatically more 
investors than we have users, and there are plenty of estimates 
available as to how this has affected the market, totally absent from 
supply and demand.
  A whole series of big oil executives have agreed that the oil market 
has been affected by as much as $60 a barrel because of this type of 
speculation.
  Mr. President, I ask unanimous consent that four of those testimonies 
be printed in the Record at this time, rather than going through them, 
in the interest of time.

[[Page S7102]]

  There being no objection, the material was ordered to be printed in 
the Record, as follows:

 Even Big Oil Executives Agree Excessive Speculation Has Driven Up Oil 
                                 Prices

       CEO of Royal Dutch Shell Said Fundamentals of the Oil 
     Market Are the Same as When Oil Sold for $60. Jeroen van der 
     Veer, CEO of Royal Dutch Shell said, ``The [oil] fundamentals 
     are no problem. They are the same as they were when oil was 
     selling for $60 a barrel, which is in itself quite a unique 
     phenomenon.'' [Washington Post, 4/11/08]
       Marathon Oil CEO Said $100 Oil Isn't Justified By Physical 
     Demand, Blamed High Oil Prices on Speculation in the Futures 
     Market. In October 2007, Marathon Oil CEO Clarence Cazalot 
     Jr. 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.'' [Detroit Free Press, 10/30/07]
       Exxon Mobil Executive Testified Price of Oil Should Be $50-
     $55 Per Barrel. Exxon Mobil Senior Vice President Stephen 
     Simon told the Senate Judiciary Committee, ``The price of oil 
     should be about $50-$55 per barrel.'' [Senate Judiciary 
     Committee, 4/1/08]
       President of the Inland Oil Company Testified Speculation 
     is the Fuel that Is Driving Up Oil Prices. In June, Gerry 
     Ramm, President of the Inland Oil Company on behalf of the 
     Petroleum Marketers Association of America, testified, 
     ``Excessive speculation on energy trading facilities is the 
     fuel that is driving this runaway train in crude oil 
     prices.'' [Senate Commerce, Science and Transportation 
     Committee Hearing, 6/3/08]

  Mr. WEBB. The whole point of this is, we need, as a government, to 
gain control over this process for the benefit of all Americans.
  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. WEBB. Mr. President, I ask unanimous consent for 1 additional 
minute.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. WEBB. Mr. President, I appreciate that.
  We need to gain control over this process for the benefit of all 
Americans, as a necessary, preliminary step before we begin addressing 
all these other areas I mentioned, as we move toward a more balanced 
and independent energy future.
  This is an area where the potential for immediate impact on the price 
of oil is available, and it is not only appropriate we address the 
issue of speculation, in my view, it is absolutely necessary if we are 
going to bring down, in a reasonable time period, the price of oil and 
the price that our citizens are paying at the pump.
  With that, I yield the floor.
  The PRESIDING OFFICER. The Senator's time has expired.
  The Senator from Utah is recognized.
  Mr. BENNETT. Mr. President, I ask unanimous consent that speakers on 
the Republican side be limited to 10 minutes each.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BENNETT. Mr. President, the bill before us today has to do with 
speculation. Let's talk about speculation for a minute. What is it? It 
is investment on the basis of assumption or expectations.
  There are those who are investing in oil futures because of the 
expectation that the price of oil will rise. If you want to get 
speculation under control, you have to change those expectations.
  What are the expectations of investors right now with respect to oil? 
It is their expectation that the price of oil will go up. It is very 
rational. The only reason they are buying an oil futures contract is 
they expect the price to go up.
  What can we do to change those expectations? Well, let us look at the 
oil market as a whole and look at it in a historical perspective. The 
first thing we must remember--and remember all the way through this 
debate--is this: The oil market is a world market. Oil prices are set 
by world supply and by world demand. It is not a market that is limited 
to the shores of the United States of America.
  So what has been going on in the oil market? Over the last 10 years, 
available sources of supply--that is, reasonable sources that could be 
producing oil relatively quickly--have been growing but very slowly. I 
have tried to get absolutely authoritative figures.
  I have been unable to come up with exact ones. But there is a 
consensus that available production capacity has been growing over the 
last 10 years at the rate of about 1 percent per year. What we do know 
is, over the last 10 years, worldwide demand has been growing at 2.5 
percent per year. Oil demand now is roughly 25 percent greater than it 
was just 10 years ago.
  It does not take a mathematical genius to put these two numbers 
together and recognize that if the available sources of supply are 
growing at only about 1 percent per year, and demand is growing at 2.5 
percent per year, the time will come when the safety margin between 
available supply and worldwide demand will be very small.
  We have reached that time now. We have reached the time where the 
safety margin between available supply and worldwide demand is so small 
that any one single incident anywhere in the world can immediately 
trigger expectations that the price of oil is going to go up. Whether 
it is domestic difficulty in Nigeria or political activity in 
Venezuela, the price of oil goes up when an event comes along that 
indicates there might be a hiccup in available oil supply. This is 
perfectly rational. It is not an act of manipulation on anybody's part. 
It is simply a logical expectation.
  Now, at one time in our history America could determine what the 
world price of oil would be. The Texas Railroad Commission could 
determine what the available productive capacity would be simply by 
permitting a few additional wells in east Texas. Every time there was a 
concern that there would not be enough oil, the Texas Railroad 
Commission would permit more wells. People would look at the safety net 
between available production and demand and say that it is high enough 
for us to keep the price of oil close to the cost of producing. For 
years and years and years, the price of oil was around $7, $8, $9, $10 
a barrel because that is what it cost to produce, and the safety margin 
between the available source of supply and demand was very large.
  Sometime in the 1970s, that power left our shores. It went from 
America over to the Middle East, and the Saudi royal family replaced 
the Texas Railroad Commission as the agency that could determine the 
price of oil. They would either increase production or lower 
production, and they found they could control the world price of oil by 
what they did to the safety margin.
  But as the safety margin has shrunk, now even the Saudi royal family 
cannot control the price of oil. There are Members of this body who 
have written President Bush asking him to go to the Saudis with a tin 
cup and beg them to increase that safety margin in the hope it will 
bring down gas prices. That is not the long-term solution to this 
problem.
  What I want to do, what Republicans want to do, is get America back 
in the game and bring the pricing power back on American shores by 
finding more and using less oil. We can do this because we have, within 
our continental boundaries, the ability to increase that safety margin. 
The Gas Price Reduction Act talks about it in two obvious areas.
  The first one is oil development in the Outer Continental Shelf. This 
could produce enough oil to increase the safety margin by a million 
barrels a day originally, and it could go up significantly from there. 
This would change the expectation, if you are focusing on speculators. 
Right now, 85 percent of our Outer Continental Shelf is off-limits by 
virtue of an executive branch moratorium that was placed on it over 25 
years ago.
  President Bush has lifted that moratorium and the markets reacted 
immediately and the price of oil fell dramatically--not because the oil 
was immediately available but because the expectation was changed. Now 
it is up to Congress to lift the congressional moratorium on the Outer 
Continental Shelf and make sure the expectation is fulfilled.
  The second area where we can find more oil is in oil shale, an 
abundant resource located in my home State of Utah. There are people 
who say, ``Oh, the technology is expensive. The technology does not 
work.'' Oil shale is producing oil in other countries today. It is time 
we allowed oil shale to produce oil in the United States. And how much? 
There is three times as much oil in the oil shale in my State, 
Colorado, and Wyoming than there is in all of Saudi Arabia. We have not 
gotten to it because it is all on public lands, and we have been 
prevented from going on to that.
  There is now a moratorium in the law that prevents the Department of 
the Interior from even writing the final

[[Page S7103]]

rules under which exploration for oil shale can take place and bids 
under which the oil shale for leases can go forward. The Department of 
the Interior has now issued a draft of what the rules will be if that 
moratorium is lifted. In the Gas Price Reduction Act, we call for that 
moratorium to be lifted.
  As soon as the moratorium is lifted, what will happen to the 
speculators? Expectations will change, and they will understand that 
America is serious about getting back in the game and bringing the 
pricing power back onto American shores and away from the Saudi royal 
family.
  Now, there has been discussion here about the other aspects of the 
Gas Price Reduction Act: hybrid cars, plug-in hybrids. I have been 
driving a hybrid car for 8 years. I know what it is like to drive a car 
that gets 55 miles to the gallon. I understand how important that is. 
That is why it is in the Gas Price Reduction Act.
  I have already addressed the question of speculation. What we need to 
do--and it is in the Gas Price Reduction Act--is increase the number of 
accountants at the Commodity Futures Trading Commission so we can make 
sure, if there is real market manipulation going on, it can be 
discovered and dealt with. But only going after speculators is not the 
way to get the price of oil down. I agree with Warren Buffett, perhaps 
the Nation's richest Democrat, who says all this talk about speculation 
being the problem is nonsense. The problem is supply and demand.
  The Gas Price Reduction Act is the logical way to deal with supply 
and demand, get America back in the game, change the expectations, and 
bring down the price of oil.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The junior Senator from Louisiana is 
recognized.
  Mr. VITTER. Mr. President, I ask the Chair to indicate when I have 
used 8 minutes.
  The PRESIDING OFFICER. The Senator will be notified.
  Mr. VITTER. I thank you the Chair.
  I am very glad we are finally taking significant time on the floor of 
the Senate to debate and hopefully to act on the single most important 
challenge facing American families, and that is gasoline prices and 
energy. I have been urging all of us in the Senate to do this for some 
time, and finally we are on that key topic.
  Let me restate the obvious: This is the top challenge facing American 
families across our country, certainly including Louisiana. This is the 
core of everyone's uncertainty and concerns about our economic future. 
To get to the heart of the matter, this is what hits people in the 
pocketbooks every week because they gas up every week. They go to the 
gas station. They need gas to get to work. They want to be able to take 
family vacations during the summer. This hits everybody where it hurts: 
in the family pocketbook.
  That is why it is crucial we attack this problem head on. That is why 
I am hopeful we are going to act in a meaningful, broad-based way here 
on the Senate floor. I urge all of my colleagues--Democrats and 
Republicans--to come together to bring every good idea they have 
related to gasoline prices and energy to this debate so we can act in a 
broad-based and meaningful way; not just talk and not just debate and 
certainly not just point fingers and be partisan but come together and 
act for the good of the American people. The American people are 
hurting. They are jolted by the dramatic rise in gasoline prices and 
they want us to act.
  It is also in the best traditions of the Senate that we have open and 
full debate and an open and full amendment process. I urge all of us--
again, Democrats and Republicans--to come together and demand and rally 
around the concept of the best tradition of the Senate being an open 
and full debate and amendment process. The American people want this 
because they not only understand this is the greatest challenge facing 
their families, they also understand there is no single answer. There 
is no silver bullet. There is no magic wand. We need to do a number of 
things, and we need to do them now. In fact, we needed to do them 
yesterday--last year, 10 years ago--but certainly at this point we need 
to act now. We need to act on a number of fronts.
  The majority leader's bill on the floor is a narrowly drafted bill 
about speculation on oil and energy in the marketplace. I certainly 
support addressing that, among other issues, as we try to stabilize and 
bring down gasoline and energy prices. Again, the American people get 
it. They understand there is no easy or single answer. There is no 
magic wand or silver bullet. We need to do a number of things, both on 
the demand side and the supply side. We need to use less and we need to 
find more right here at home.
  Today I am filing seven amendments for consideration and votes in 
this debate. We need to do a number of things that are significant to 
help stabilize the price of gasoline, to help develop a rational energy 
policy, and we need to act both on the demand side and the supply side. 
We need to use less and we need to find more right here at home.
  Let me speak about exactly what those amendments are. My first 
amendment would increase domestic production of oil and gas offshore as 
well as develop alternative energy sources offshore. It is based on a 
freestanding bill I introduced several weeks ago, the ENOUGH Act--the 
Energy Needed Offshore Under Gas Hikes Act. It allows for increased 
domestic production of oil and gas in the Outer Continental Shelf when 
a particular State's Governor, with the concurrence of the State 
legislature, petitions the Federal Government for this activity. It 
would also provide an incentive for States to do that by offering 
revenuesharing. Specifically, while 45 percent of the royalties on that 
production would still go to the Federal Treasury, 37.5 percent would 
go to the producing State involved, 12.5 percent would go to the 
Federal Land and Water Conservation fund, which I strongly support, and 
5 percent would go to historically producing States which have produced 
for 50 years or more and never got revenuesharing for all of that 
commitment to meeting the Nation's energy needs.
  This amendment is not only about producing more; it is also about 
alternatives. In addition, this amendment develops alternative energy 
offshore by establishing a grant program for offshore alternative 
energy production, by converting existing offshore energy 
infrastructure into alternative production facilities--for instance, 
turning old lease areas into new offshore wind farms--and for allowing 
revenuesharing in that alternative energy production offshore as well. 
I urge my colleagues to look favorably on this positive amendment.
  My second of seven amendments would flat out repeal the present 
congressional moratorium on activity in the Outer Continental Shelf. 
Last week, President Bush took a very positive and necessary step 
forward. He lifted the existing Executive moratorium that had been in 
place for the Outer Continental Shelf. However, as we all know, there 
is a congressional moratorium at the same time, so his action wasn't 
good enough to allow us to develop those resources. My amendment, my 
second amendment No. 5090, would lift the existing congressional 
moratorium. It too includes developing alternative energy offshore--
that package of proposals I enumerated--to develop new, clean, 
alternative energy sources offshore.
  My third amendment is somewhat akin to the second amendment which 
lifts the congressional moratorium on the OCS. My third amendment would 
lift the present congressional moratorium on shale production in the 
West. As we all know, Congress placed a moratorium on final regulations 
for the development of oil shale in the western United States. That 
puts to a halt all of that positive productive activity that could lead 
to major energy finds in the western United States on land--oil coming 
out of that western shale.
  The PRESIDING OFFICER. The Senator from Louisiana has consumed 8 
minutes.
  Mr. VITTER. I thank you the Chair.
  It is very important that we lift that counterproductive 
congressional moratorium and move forward with regard to western shale. 
There are enormous energy resources there. We need to tap those. To do 
that, the first step we need to take is lifting that current 
congressional moratorium on all of that activity.

[[Page S7104]]

  My fourth amendment is to develop alternative energy offshore--that 
package of proposals I mentioned a few minutes ago which is also part 
of the first three amendments.
  My fifth amendment is to streamline the permitting process so we can 
expand refinery capacity. We would start with existing refineries which 
have the ability to expand. As we all know, we need to find more energy 
here at home, but we also have a refinery capacity issue and we need to 
address both sides of that coin. So it is crucial we streamline the 
permitting process for refineries right here at home. It is far too 
cumbersome and uncertain and complicated. My fifth amendment would 
allow us to expand refinery capacity here at home in a way we sorely 
need to do.
  Finally, my final amendment would streamline the permitting for 
offshore leases. Excuse me. That is No. 6, to streamline the permitting 
process for offshore leases, which also is far too cumbersome and 
complicated and takes far too long, to allow producers and developers 
to get in the field and actually produce energy from those offshore 
leases.
  My seventh and final amendment would change the seaward boundaries 
for the Gulf States of Louisiana, Mississippi, and Alabama.
  Mr. President, I ask unanimous consent for 1 additional minute.
  The PRESIDING OFFICER. Without objection, it is so ordered.

  Mr. VITTER. I thank the Chair.
  Under current law, Florida and Texas have State waters for 9 miles 
from their coastline, but in stark contrast to that, Louisiana, 
Mississippi, and Alabama's State waters are only the first 3 miles from 
their coasts. This is grossly unfair. In addition, expanding the State 
waters of Louisiana, Mississippi, and Alabama to match their neighbors 
to the west and the east--Texas and Florida--would help promote more 
production in the gulf because it is a far easier, less cumbersome 
process to produce, get permitting, and move forward on State waters 
than on Federal lands.
  With that in mind, I certainly hope we can have the full, open debate 
and open amendment process to consider these and other good ideas.
  In that vein, I ask unanimous consent that when the Senate proceeds 
to S. 3248, it be limited to energy-related amendments only; further, 
that the amendments be offered in an alternating fashion between the 
two sides. I further ask unanimous consent that the bill remain the 
pending business to the exclusion of all other business other than 
privileged matters and other matters that the two leaders might agree 
upon.
  The PRESIDING OFFICER. In my capacity as a Senator from Ohio, I 
object.
  The senior Senator from Wyoming is recognized.
  Mr. ENZI. I thank the Chair.
  I rise today to also discuss the No. 1 issue that is facing our 
Nation. That issue is the rising price of energy. Everyone out there 
whom this affects knows who they are: It is anyone who rides or drives 
or eats. While I am glad the Senate is finally considering energy 
legislation, I am disappointed by the scope of that legislation. I hear 
from my constituents each and every day that the Senate needs to do 
something about energy prices. I couldn't agree more. We need to put 
aside partisan politics in order to pass legislation that will address 
the energy situation we are facing.
  Today, the Senate is considering S. 3268, the energy speculators 
bill. This bill is kind of like a hearty meal of meat, bread, and 
potatoes but without the meat--oh, and without the bread--and it 
doesn't really have potatoes in it either. This bill deals only with 
the issue of oil speculation. It does not deal with the issue of supply 
and demand. It does not deal with the need to encourage conservation. 
It does not deal with the extension of important tax credits to promote 
renewable energy.
  Instead, the bill seeks to extend the long arm of the law to reach 
out and strike down those ``speculators'' who are supposedly driving 
the price of oil faster and higher than a rocket ship. I ask my 
colleagues now, why would we in the Senate want to strike down 
teachers, civil servants, and farmers? The bill does not recognize that 
that is who the so-called speculators are. Speculators are oftentimes 
pension fund investors who protect the retirement of teachers and civil 
servants. The ``evil'' speculators are American farmers who want to 
save money on their supplies and fertilizer and on airlines that want 
to cut fuel costs by locking in a price that will make the customer's 
plane tickets cheaper.
  This legislation does not recognize that futures markets and the 
investors who trade in them are crucial to getting the best price for 
the product and attracting investment in the United States. Cities such 
as Dubai and countries such as India and China are the places that will 
benefit from this bill. They would benefit because many of the jobs 
that would be in New York or Chicago--jobs that are currently 
American--would no longer be.
  I am the ranking member of the Senate committee that handles 
pensions, so let's get back to the people who have pensions and how 
this bill impacts them. These people are the employees of most of our 
largest companies and include airline, trucking, automotive, 
manufacturing, education, and public civil servant employees. This bill 
would hurt them. I am alarmed the bill could declare portions of our 
financial markets off limits to institutional investors, including 
pension funds, endowments, and foundations.
  Laws we have passed say that pension money should be vested in a 
prudent manner. We in Congress have long insisted pension plans 
diversify their assets so they don't have ``all their eggs in one 
basket.'' However, if we start down the slippery slope the majority 
leader has set before us in his bill, then we will limit the ability of 
pension plans and other institutional investors to diversify their 
investment strategies. This bill takes away baskets that they could put 
their eggs in. If the pension plans are prudently invested and well-
managed, there is no reason they should be barred from any segment of 
the commodities, futures, or capital markets.
  The majority contends that this legislation will bring down the price 
of gas. Let's see, this bill will not result in the production of any 
more gas, nor will it result in any less demand for gas.
  I tend to agree that many of the Nation's brightest minds who suggest 
that ``speculators'' have little to do with the increase in energy 
prices are right.
  Warren Buffett, the Nation's wealthiest Democrat, does not believe 
speculators are the cause. T. Boone Pickens, who has been in the news 
for his efforts to end our Nation's dependence on foreign oil and who 
addressed Democrats at their weekly caucus lunch, has said that 
speculators play a minimal role. Federal Reserve Chairman Ben Bernanke 
made his views clear at a hearing before the Senate Banking Committee 
on July 15 when he stated:

       If financial speculation were pushing oil prices above the 
     levels consistent with the fundamentals of supply and demand, 
     we would expect inventories of crude oil and petroleum 
     products to increase as supply rose and demand fell. But in 
     fact, available data on oil inventories show notable declines 
     over the past year.

  Bernanke continued:

       This is not to say that useful steps could not be taken to 
     improve the transparency and functioning of futures markets, 
     only that such steps are unlikely to substantially affect the 
     prices of oil or other commodities in the longer term.

  Chairman Bernanke's statement should provide us with a starting point 
for any legislation, and I am a cosponsor of legislation that begins 
the process of having a sensible energy policy. The Gas Price Reduction 
Act addresses the need for more transparency in our markets and more 
oversight by the Commodities Futures Trading Commission. However, that 
is not the focus of the legislation. While the transparency is 
important, the larger problem we face is a lack of supply and an 
increase in demand. The majority leader's bill is like the novel an 
unwise motorist reads while driving down the highway. The novel is the 
wrong focus and while you pay attention to that you could get 
sideswiped by something you should be paying attention to--in our case, 
no supply and a whole lot of demand.
  We need to find more American oil from American soil at the same time 
that we use less, and we need to look at alternative fuels.

[[Page S7105]]

  The Gas Price Reduction Act includes provisions to open coastal 
waters in States that want energy production. It ends the ban on the 
development of promising oil shale in Wyoming, Colorado, and Utah. At 
the same time, it encourages increases in supply. It promotes the 
development of better technology so that we use less energy, and it 
explores alternative sources. The supply and demands issues are not 
addressed in the majority leader's oil speculation bill.
  The majority leader's bill also ignores the important role that coal 
can play in securing America's energy future. It ignores the need to 
streamline the process for permitting new refineries. It ignores the 
need to increase the use of nuclear as a clean energy source.
  You will notice that a lot of these things are also not in the 
Republican bill that I mentioned. That bill is a compilation of items 
that everybody here ought to be able to support. The items that have 
been controversial have been left out. We can use my 80/20 rule. We can 
agree on 80 percent of the issues 80 percent of the time. If we stick 
to that and leave the rest to the pundits, it will work out well. 
Sometimes we try to do things that are too comprehensive because one 
amendment will pull off 3 votes and another one might pull off 10 votes 
and another might pull off 15 votes. Then you don't have a majority to 
pass a bill. I am not sure that is what the other side is hoping for.
  I hope we can keep this simple and get something done--something 
besides just speculation. I hope we are able to have an open debate 
over the next 2 weeks. I hope we are allowed to offer energy amendments 
and have up-or-down votes. If we can have that real debate, I am 
confident the Senate can come up with a package that could be signed 
into law, and both sides will get credit. Believe it or not, I actually 
agree with the majority party on some steps that would help to make 
this country more energy independent. Wind tax credits are one example. 
But restricting Senators' participation, stopping them from 
representing those who put them in office, is not going to get us any 
further than an empty tank of gas. That is what this bill will do in 
its current form.
  The PRESIDING OFFICER (Mr. Menendez). The time of the Senator has 
expired.
  Mr. ENZI. Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from Ohio is recognized.
  Mr. BROWN. Mr. President, today gas costs $4.09 in Bellefontaine, OH. 
In Conneaut, it is $4.05 a gallon. In Galion--not far from where I grew 
up in Mansfield--gas costs $4.04 a gallon. In southern Ohio, in New 
Boston, on the Ohio River, gas costs $4.06 a gallon.
  Instead of helping the residents of those communities and in other 
States around the country, my Republican colleagues are asking for 
another handout for Exxon, Shell, BP, and Chevron. The last thing oil 
companies need is a handout. They don't need more drilling permits on 
top of the unused permits they already have. What big oil does need is 
to revisit their business strategy because if they think complaining 
about the need for more drilling permits and getting my friends on the 
other side of the aisle to do their bidding and having a President of 
the United States and a Vice President--two oilmen--siding with them 
time after time--if they think that will win over the hearts and minds 
of the American people, they have another thing coming. The people I 
report to don't like opportunists, they don't like snake oil salesmen, 
and they don't like unbridled greed.
  Big oil has 68 million acres, directly or indirectly, of leased 
Federal lands they are not even drilling. That is 2.5 times the size of 
my State of Ohio. But somehow, to big oil, that isn't enough. Somehow, 
record profits aren't enough. Somehow, big oil executives making tens 
of millions of dollars every year isn't enough. Big oil wants the right 
to drill everywhere and anywhere so they can attract more shareholders 
and make more money. Perhaps that is understandable. What is not 
understandable is people who are elected to office doing bidding for 
them. Oil companies should use the lands that are already leased, and 
they should reinvest in refineries and alternative fuels--not lobby for 
another land grab.
  Republicans back the oil companies up, parroting them on the need for 
more drilling. I suppose it is nice to have friends in the oil 
industry. But we are not in Congress to make friends with the oil 
industry. We are not in Congress to do the oil industry's bidding. We 
are in Congress because Americans put us here, and they deserve real 
answers, real solutions.
  Talking about drilling is a lot easier than doing real work. It is 
easier than tracking down the most promising avenues in alternative 
energy and accelerating their development. It is easier than opening 
the stockpile of U.S. oil and demanding real accountability from oil 
companies. And it is easier than taking on the speculators--as the 
majority leader's bill does today--who are making handshake deals that 
push prices higher and higher.
  Going after the speculators is what this bill we are debating today 
is about. It would go after unscrupulous, unregulated traders. It would 
crack down on underhanded price manipulation so we can pop the energy 
price balloon.
  Instead of cuddling up to the energy industry and specialty oil 
companies, we should go after price gouging, price manipulation, and 
price speculation. The White House may report to big oil, but we don't. 
Some in the other party, in both the Senate and House, may do the 
bidding of big oil too, but we should not and cannot, and we won't.
  Mr. President, I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. SALAZAR. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. SALAZAR. Mr. President, I come to the floor this afternoon to 
speak about the myth about oil shale and what some people have been 
talking about on the floor of the Senate and around the country is a 
quick fix to the oil challenges we face in America today, a quick fix 
to the high prices of gas and diesel we are paying across the country, 
and offering oil shale as the panacea that will cure that problem.
  The fact is that is not the case. Those who are propounding that view 
of our future energy world, in my view, are false prophets because they 
are not telling the American people the truth about oil shale.
  I am concerned and involved with this issue because of the fact that 
80 percent of the oil shale reserves are located in my State of 
Colorado. We are not at a point in time where the technology has been 
developed for us to move forward in the development of oil shale. So 
anyone who says this is a panacea to the oil challenges we face in 
America today is simply wrong.
  The oil companies themselves have said we are not ready to move 
forward with a commercial oil shale leasing program at this point in 
time. Chevron, one of the largest oil companies in the world, had the 
following to say:

       Chevron believes that a full-scale commercial leasing 
     program should not proceed at this time without clear 
     demonstration of commercial technologies.

  That was March 20, 2008. That is what Chevron is saying. Yet 
notwithstanding what Chevron says about oil shale and development of 
oil shale technology, we have the Department of the Interior, the White 
House, and the Bureau of Land Management saying we have to move full 
speed ahead and rush forward with the issuing of these oil shale 
regulations which essentially will lock up close to 1 million acres of 
lands across the West, most of that in my State of Colorado, and doing 
it without knowing whether we have the technology to develop oil shale.
  I suggest to my colleagues that as we engage in this debate 
concerning the high price of gas and our addiction to foreign oil that 
we come together in a bipartisan way and focus on solutions that 
ultimately will get rid of the addiction we have to foreign oil and 
that we embark on a Manhattan-type project that will actually get us to 
the point where we can finally claim we have set America free.
  There is broad bipartisan agreement on real solutions that we know 
work. In fact, in the Energy Committee, on which the Presiding Officer 
has been

[[Page S7106]]

such a distinguished and effective member, we know we have come up with 
solutions that we need to continue to push and push further.
  If we think back to what we did in 2005, 2006, and 2007 to increase 
supply, we have also done a lot to diminish the demand for oil in the 
United States of America. The CAFE standards alone, which we passed and 
which the President signed into law last December 2007, will save the 
United States about 1.2 million barrels of oil per day. We use about 20 
million barrels of oil per day in America. The CAFE standards we have 
put in place will save us 1.2 million barrels per day. That was 
accomplished in a bipartisan spirit, Republicans and Democrats working 
together in this Congress.
  With respect to biofuels, an agenda which also is neither a 
Democratic nor Republican agenda, we have a law now in place that will 
embrace a new energy frontier that includes biofuels. It is not only 
ethanol, it is cellulosic ethanol and other forms of biofuels we can 
use. We know when we do the estimates of how much oil we will save by 
use of biofuels, we will be able to save up to 1.6 million barrels a 
day that we will not have to import from the Middle East and other 
countries that have the world's oil reserves.
  There are things we have done that we know, in fact, will work. This 
morning in the Energy Committee, we had a hearing on some of the things 
that can work. We had a memorandum prepared by the staff of the Energy 
Committee in which they reviewed some of what we have already done, 
starting with the 2005 act. They included the following:
  Section 701, use of alternative fuels by dual-fueled flex vehicles. 
That is the Flex Fuel Program. Review of the fuel/hybrid vehicle 
commercialization initiative; advanced vehicles; fuel cell transit bus 
demonstration; clean schoolbus program; diesel truck retrofit and fleet 
modernization program; fuel cell schoolbuses; railroad efficiency; 
reduction of engine idling.
  Each of those is a different section in the 2005 Energy Policy Act 
which passed under the leadership of Senator Domenici and Senator 
Bingaman, and with many of us on both sides of the aisle a part of 
crafting it.
  It goes on. Ultra-efficient engine technology for aircraft; 
enforcement of the fuel economy standards; Federal procurement of 
stationary, portable, and micro fuel cells; diesel emissions reduction 
authorizations; renewable content of gasoline, and on and on.
  There are major provisions enacted into law which are good policy 
which will help start getting us off this addiction we have to foreign 
oil.
  We continued in that fashion in 2006 when, again, a bipartisan group 
of Senators came together and decided to open part of the gulf coast 
with lease sale 181. That opened about 8 million acres for exploration 
and production in the gulf coast, a place where we know we have some of 
the largest reserves that are under the control of the United States.
  We have been pushing programs that embrace a new energy frontier, as 
well as trying to put more production online here for the United States 
of America.
  It is very important to think about what happened not so long ago, at 
the end of last year with the Energy Independence and Security Act of 
2007. We passed a series of programs that are intended to help us get 
to energy independence. Chief among them was CAFE standards which were 
so long in coming and which had been neglected for such a long time. 
Those CAFE standards, when implemented, will save, as I said earlier, 
over 1 million barrels of oil a day that we will not have to import 
from other countries.
  Those are the kinds of efforts on which we can come together. We can 
find a new way for America that will deal with the inescapable forces 
of our time that call us to move forward in an imperative way toward 
energy independence. Those inescapable forces that are with us today 
are the national security of the United States of America, the 
environmental security of our globe, and the economic opportunity which 
we can create at home with a new energy agenda.
  That is the kind of program we ought to be getting to today and this 
week as we try to move forward with energy legislation in the Senate.
  But there are those who would say, again, it is all about oil shale, 
that what we ought to do is go ahead and open the OCS, including those 
areas where there are moratoria. They say we ought to go ahead and take 
the 1 trillion barrels or 800 billion barrels of oil that are locked up 
in the rock of the West. And they say we ought to do that to deal with 
the current problem we have.
  I am one of those people who is pro-production, and we do have a lot 
of production that comes from my State. In fact, in the last 5 years, 
the production of oil and natural gas in my State has increased more 
than twofold, so we are adding significantly to the pipelines that 
produce energy for our Nation. But oil shale is not the answer. Chevron 
said they do not believe we are ready for commercial regulations for 
oil shale. They were joined by some of the major newspapers in both 
Colorado and Utah, Colorado being the place where most of the oil 
reserves are.
  The Denver Post said:

       Developing oil shale has been a dream since the early 20th 
     century. But careful planning is needed to make sure the 
     dream doesn't turn into a nightmare.

  In recent days, some politicians loudly demanded the immediate 
leasing of massive oil shale reserves in Colorado, Wyoming, and Utah as 
a way to swiftly lower gasoline prices.
  The Denver Post says:

       The idea is ludicrous, and goes directly against the advice 
     of the very energy companies that are actively researching 
     how to tap the enormous but economically elusive oil shale 
     reserves.

  They were not alone. The Grand Junction Sentinel, which covers 20 
counties, had the following to say:

       The notion that the one-year moratorium on commercial 
     leasing approved by Congress last year is somehow a barrier 
     to commercial development is nonsense. If anything, that 
     moratorium should be extended.

  One might say that is what the oil companies said and one might say 
that is what the editorial boards of Colorado said, where 80 percent of 
the oil shale reserves are located.
  What do the Department of the Interior and the Bureau of Land 
Management have to say with respect to how we move forward with oil 
shale development? Yesterday, the Bureau of Land Management and the 
Secretary of the Department of the Interior said we are going to go 
ahead and issue regulations that will allow the full-scale 
commercialization and development of oil shale in the West.
  What is included in the report that the Department of the Interior 
and the Bureau of Land Management issued? In their own words, this is 
what the BLM said yesterday in issuing the report on commercial 
regulations:

       Currently, there is no oil shale industry and the oil shale 
     extractive technology is still in its rudimentary stages.

  It ``is still in its rudimentary stages.'' It baffles my mind why it 
is that the Bush administration and the Department of the Interior 
would want to move forward as fast as they can to get this done before 
the election and a new administration. Why would they want to do that? 
Why would they want to do that given their own findings in the 
Department of the Interior?
  That is not all they said. They continued in their own report 
concerning commercial oil shale regulations to say the following:

       The lack of a domestic oil shale industry makes it 
     speculative to project the demand for oil shale leases, the 
     technical capability to develop the resource, and the 
     economics of producing shale oil.

  So with that kind of a statement, how is it that the Department of 
Interior, Bureau of Land Management, can be in a place where they can 
issue finalized regulations for the leasing of oil shale for commercial 
production?
  The BLM, again in its own words--this is not an editorial board, it 
is not even one of the oil companies, this is the Department of the 
Interior, Bureau of Land Management in its own findings saying:

       It is not presently known how much surface water will be 
     needed to support future development of an oil shale 
     industry. Depending on the need, there could be a noticeable 
     reduction in local agricultural production and use.

  I wish to make a comment about that. I spent good part of my life 
dealing with the water issues of the West--the water issues of 
Colorado, the interstate compacts that deal with the allocation of 
water in the West--and there

[[Page S7107]]

is no question that for those of us who come from the arid West, we 
recognize that water is the lifeblood of our communities. Without 
water, communities die. They dry up and they go away. We are a water-
short State. We don't know how much water will be used in the 
development of the oil shale of western Colorado. The BLM says we don't 
know how much water will be used in the development of oil shale in 
western Colorado. So how, without knowing this very crucial fact, can 
the Department of the Interior and the Bureau of Land Management be 
ready to move forward with a full-scale commercial leasing program for 
oil shale? It makes no sense in the world.
  That is not all they say. They continue with some other comments. 
Again, this is the Bureau of Land Management, July 22, 2008. That was 
yesterday, by the way, when the BLM went ahead and issued its proposed 
regulations. In the documents, July 22, 2008, the BLM says:

       We have no reasonable way to generate meaningful scenarios 
     to quantify the potential impacts for an industry that does 
     not exist or technologies that have not been deployed.

  This is not the Denver Post or the Rocky Mountain News or the Grand 
Junction Sentinel or even the likes of the Salt Lake City Tribune. 
These are not the words of the Chevron Oil company. These are the words 
of the Department of the Interior, Bureau of Land Management. Yet 
notwithstanding these realities, we have a number of people who are 
telling us to rush headlong and develop the shale of the West.
  If you look at that shale, what you will find is rock. It is solid 
rock. That is why, for nearly 100 years, people have been trying to 
figure out how they can extract the oil from that rock. It is a lot 
more difficult than it seems. That is why this sense that oil shale 
development is something that can help deal with the gasoline prices we 
are facing today is simply a falsehood.
  I would hope, as we move forward with the debate over our energy 
future in this country, we can address real solutions--the problem with 
speculation, which experts tell us accounts for 20 to 50 percent of the 
price we are now paying for a barrel of oil. We can address the issue 
of speculation that is included in legislation the Republicans have 
offered in their amendment and the legislation Senator Reid has on the 
floor, and there are other proposals we can also include in an energy 
package, including being much more aggressive in those issues we have 
included in the 2005 Energy Policy Act, as well as in the 2007 Energy 
Act we passed.
  So I hope as we move forward, we will offer real solutions, not false 
solutions. I believe we have a bipartisan basis from which we can 
develop that way forward in the Senate.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Texas.
  Mrs. HUTCHISON. Mr. President, is this the beginning of the 
Republican time?
  The PRESIDING OFFICER. There is 1\1/2\ minutes remaining on the 
Democratic side, but it does not appear it is presently being asked 
for, so the Senator is recognized.
  Mrs. HUTCHISON. Mr. President, am I correct that the next 30 minutes 
is Republican time?
  The PRESIDING OFFICER. The Senator is correct.
  Mrs. HUTCHISON. Mr. President, I rise to speak because I think the 
Senate has a duty. We have a duty to the American people to take 
positive, logical, decisive action to deal with the energy crisis we 
are facing. Since control of Congress changed hands last year, the 
price of gasoline has soared from an average of $2.33 a gallon to $4.06 
a gallon. That is a 75-percent increase.
  In my State of Texas, my husband took our van to fill it this weekend 
and he came home with sticker shock, similar to every husband or wife 
in every family in this country. It is $100 to fill a tank in many 
places in our country. So the American people have a right to look to 
Congress for leadership, but what have they gotten in response? The 
bill that is before us today does not reduce a single drop of oil, not 
a cubic foot of natural gas, and not a single watt of electricity. 
There is nothing in this bill before us that will address the issue of 
producing more and using less.
  What we have is addressing one very small portion of what might be a 
part of the problem, and that is speculators. We should be looking at 
speculators, I agree. We all support transparency in speculation. But 
we have an energy bill and an opportunity on the floor today. Why don't 
we open this bill so we actually are doing something about the price of 
energy? The long-term solution is the short-term solution. Bringing 
down the price of oil and gas at the pump is a long-term solution that 
will have short-term consequences that will help every American small 
business and every family in this country.

  We could be looking at conservation. We have already done something 
in the last Energy bill we passed. We increased CAFE standards to 35 
miles per gallon by the year 2020. That is conservation, and it will 
make a big difference. We have time to get to that point. We have 
included in the Gas Price Reduction Act that the Republicans put 
forward a provision that will help America's transportation sector 
transition into advanced hybrid and electric vehicle technology more 
quickly.
  But what is missing? What have we not addressed that would make a 
difference? Increased production, that is what. By refusing to pass any 
bill that would produce more energy inside our country, we are left to 
wonder: Do our colleagues want to bring down cost? Do they understand 
the plight of the American people? Or is it an exercise to deal with 
something that is very much on the fringes and which is not going to 
make a consequential difference and certainly not a long-term solution.
  Does anyone think Congress can take an action on a speculation bill 
and say: Oh good, we have done something for the American people? The 
Republicans do not believe that is the case. Here is what Republicans 
want to do: We want to apply common sense and expand access to drilling 
on the Outer Continental Shelf.
  According to the Minerals Management Service, the OCS--the Outer 
Continental Shelf--could produce 14 billion barrels of oil and 55 
trillion cubic feet of gas. Advances in technology have made it 
possible to conduct oil exploration in the Outer Continental Shelf that 
is out of sight of tourists, and it protects against oil spills. States 
should have the option of opening the OCS resources off their own 
shores, and the Federal Government should allow States to have a share 
in the leasing revenues.
  State leaders in Virginia, North Carolina, South Carolina, and 
Georgia have expressed support for this concept. Why won't Congress 
give it to them? Because we are being blocked by the Democratic 
majority, I am sad to say. We can do this, and we can do it right now. 
There are four provisions that prevent us from using those resources. 
All we have to do is delete that moratorium that has been put in place 
by Congress. The President has asked Congress to do this, and we could 
move forward.
  I was disappointed yesterday to learn that the Senate Appropriations 
Committee canceled the markup on the bill that was scheduled to be 
marked up tomorrow, the Interior Appropriations bill, and it appears 
the reason is that last week, Senator Domenici, Senator Bond, and 
myself announced we would have an amendment that would strike the 
congressional moratorium on Outer Continental Shelf options for States. 
The markup on an Appropriations bill for the Department of the Interior 
was canceled because they didn't want to vote on an amendment that 
would open the Outer Continental Shelf based on a State option.
  The initiative also would tap the potential of oil shale. Now, I 
heard the Senator from Colorado say we shouldn't be acting because we 
don't know enough yet. The other Senator from Colorado says: Yes, we 
should act because we know there is shale in Colorado, Utah, and 
Wyoming that is controlled by the Federal Government, and the estimates 
by the experts are there is 800 billion barrels of recoverable oil, 
which would be three times the reserves of Saudi Arabia. Again, the 
President has called on Congress to lift the moratorium. If we don't 
take the first step, we will never know. We will never know how much is 
there, and we will not be able to start the process of increasing 
supply so the price will come down.

[[Page S7108]]

  For those who say we can't drill our way out of the energy problem, I 
agree. We can't drill our way out of it. But drilling should be part of 
the solution. The oil and gas we have in places such as the OCS can be 
used as a bridge to cross into the next generation of energy 
technologies, including solar power, wind, and nuclear power. The 
American people see this. Thank goodness the American people have the 
common sense to see through the argument it will take too long to do 
it; that we shouldn't be looking at our own natural resources, that we 
should be ranting about other countries not using their natural 
resources for our benefit.
  We should take control of our own resources and we should solve this 
problem the way Americans have always solved the problems of our 
country over the last 200 years and that is to look to ourselves--look 
to our natural resources, which are abundant, let's use technology, 
let's use our brains, let's use solar, wind, and the new energies we 
know can be found if we put our minds to it--and oil and natural gas 
are the first step. They are the transition. They are what we know now, 
and we know we can do this in an environmentally safe way.
  Some question: Well, what about the environmental impact of drilling 
offshore? We had one of the worst hurricanes, with the worst damage 
aftermath in the history of our country--Katrina--in 2005, which was 
followed immediately by Hurricane Rita, and it struck the gulf coast 
hard. We have oil rigs in the gulf coast. Yet there was not one major 
spill. There was no damage to the environment. The technology has 
improved so much for offshore drilling, that we know we can do it and 
protect our environment and also help our people, our economy, and our 
national security by controlling our own energy supply and destiny.
  Our country will spend hundreds of billions of dollars this year to 
import energy from foreign countries, many of which do not wish us well 
and could shut us off in a moment. Those dollars should be spent right 
here in America, giving jobs to Americans and giving an energy supply 
to American small businesses and families that will bring the price 
down. That is what the Republicans are offering.

  It is time for Congress to act in a bipartisan way with a policy that 
is balanced, that will give us a transition into the next generation of 
energy. We have the chance. I implore the majority to give us that 
opportunity.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Mississippi is recognized.
  Mr. WICKER. Mr. President, I ask unanimous consent that Senator 
Cochran and I be permitted to use 10 minutes to enter into a colloquy.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. WICKER. Mr. President, in the next few days and weeks, the Senate 
has an opportunity to engage in real bipartisanship. We have a chance 
to adopt pragmatic solutions in the 25 or so remaining days we have in 
session this year. We can adopt concrete steps to address what many 
regard as the greatest energy crisis of our lifetime. I see an 
opportunity for Congress to act now to bring an end to the pain 
Americans are feeling each time they go to the pump.
  As a Senator from Mississippi, I can tell you as I travel around my 
State, as I have town meetings and as I talk to people on the phone and 
engage them in any way a legislator does, that the No. 1 issue among my 
constituents is the ever increasing price of gasoline. We have some 
urban areas in Mississippi but not many. We have some suburbs, but we 
are mostly small towns and rural areas. We do not have the option of 
using public transportation. We know it is not possible for the farmers 
in Mississippi to park their farm equipment if they are going to try to 
stay in business.
  Skyrocketing gas prices are hitting American families and communities 
and they are also hitting our government agencies. Police departments, 
fire departments, schools, and even our military are being squeezed by 
the high price of fuel. Yes, the price of fuel and our reliance on 
foreign sources even constitute a threat to our national security 
because of the effect they are having on our military. We are reaching 
closer and closer to a true emergency situation and it is past time for 
real legislative accomplishments. What the people of the United States 
need and what our Nation deserves is a comprehensive long-term plan for 
domestic exploration, conservation, and the introduction of renewable 
and alternative fuels into the energy marketplace. That is why I hope 
we can have an open amendment process on this legislation, to allow 
open debate in the Senate about this.
  The average price of gas in my home State of Mississippi is currently 
between $3.80 and $3.90 per gallon. Only a year ago it was $1 less. 
Many people do not understand why these prices have risen so 
dramatically. There is a variety of viewpoints but it all comes back to 
our unwillingness to produce more energy here in the United States.
  At this point I yield to my friend from Mississippi, the senior 
Senator.
  The PRESIDING OFFICER. The senior Senator from Mississippi is 
recognized.
  Mr. COCHRAN. Mr. President, I thank my distinguished colleague for 
yielding. I am pleased to join him, to thank him for his remarks and 
his leadership on this pressing concern. The Department of Energy 
estimates that even with intensive conservation efforts in place and 
enforced, maintaining our economic growth through 2025 will require a 
36-percent increase in energy supply. Unfortunately, over half of the 
oil we are now using is imported, imported from high-cost foreign 
sources. As demand rises and domestic supply is not increased to 
accommodate for our own needs, we will continue to be subject to the 
prices being set by foreign countries.
  This is not only due to increases in demand from developed countries. 
The increased cost for petroleum is also affected by the demand in 
emerging economies such as India and China. There are new pressures and 
new reasons why the cost continues to go up. In fact, between 2008 and 
2030 it is expected that in China and India, they will account for 70 
percent of the increase in global consumption.
  What we are urging is not just to take the shortsighted look, the 
easy answer the majority party has put before the Senate, but take a 
bold stance--come out for using more American energy, not from 
expensive foreign sources. We can develop our offshore resources in the 
Gulf of Mexico, for example, far from the coastline, and add to our 
energy supply. That will bring down costs.
  We need to do real things. We need to conserve more. We need to look 
for alternative sources, and there are plans in place and programs to 
do that. What I am saying is we should not give up. That is what this 
bill that has been brought before the Senate does. It is a bill to 
surrender--surrender to the high cost of foreign oil and gas. We do not 
need to adopt it. There are better alternatives and we are urging that 
we embrace them.
  I appreciate the Senator yielding.
  Mr. WICKER. Mr. President, I have long supported the efforts to lift 
the moratorium on energy exploration in the United States and Alaska's 
Arctic National Wildlife Refuge, which we commonly refer to as ANWR, 
and also on the Outer Continental Shelf. A lot of us in Washington, DC 
use the term ANWR and we bandy it about. I am afraid some people out in 
grassroots America may not realize what ANWR is. ANWR is an Arctic 
reserve that is the size of the State of South Carolina. It is a vast 
frozen area in the very northernmost part of Alaska.
  What we have proposed is drilling for oil there in a small area, 
about the size of the typical metropolitan airport in this vast 
reserve. Congress sent President Clinton a bill in 1995 to provide for 
energy exploration in ANWR. We are told that if President Clinton had 
not vetoed that bill in 1995, we would today be getting the same amount 
of crude oil from ANWR as we are currently having to import from Saudi 
Arabia. This would have been American jobs. This would have been 
American dollars spent here in the United States to make us less energy 
dependent on foreign and unstable sources.
  Last week, President Bush took a major step in moving us toward 
energy independence when he lifted the Executive ban on offshore 
drilling. We still have the obstacle of a congressionally mandated ban 
on offshore drilling, which we ought to be discussing in this

[[Page S7109]]

legislation today. We ought to be voting on it in the next 25 
legislative days that we have remaining.
  The peak of pricing for a barrel of crude oil was $146 per barrel 
only a few short days ago. Yesterday it closed at $126.80 per barrel. 
There are experts who will tell you that the confidence injected into 
the markets by this simple step by President Bush caused a drop of some 
$19 per barrel in the price of crude oil.
  If Congress would take the further step and actually pass the 
legislation to lift this ban or, more precisely, to allow the 
moratorium to expire at the end of the fiscal year, I think there would 
be even more confidence in the market, and the price of crude oil and 
gasoline would continue to drop.
  We also need to eliminate the ban on oil shale. This has been 
discussed this morning. We have three times the amount of crude oil 
reserves in three Western States in the form of oil shale, three times 
the supply as we currently see in Saudi Arabia.
  I think lifting the moratorium on offshore drilling, lifting the 
moratorium on ANWR, and lifting the moratorium on the exploration of 
oil shale in our own country, are steps we definitely need to take. 
Every moment we are idle we will be ever more dependent on foreign 
sources of oil. I think we need to act and act this year.
  Again, I toss it back to my friend, the senior Senator from 
Mississippi.
  The PRESIDING OFFICER. The senior Senator from Mississippi.
  Mr. COCHRAN. Mr. President, I thank my colleague for yielding again 
to me. We do not have time to waste. This is the point. We have 
proposals to utilize more of our own energy. We can do it. We just need 
to make ourselves realize that is a better answer than pushing the 
dates farther along when we do nothing, do nothing, say we are doing 
something but not getting at the problem. Unless we produce more of 
what we need here at home, we are going to continue to be subject to 
the decisions being made overseas by those who have the oil, have 
greater resources than we do. But we have enormous resources in the 
Arctic National Wildlife Refuge. Technologies have developed to the 
point we can produce that energy and protect the environment at the 
same time. We need to gut it up and approve it, approve expanded 
exploration and production from our own resources.
  The Gulf of Mexico has a huge reserve of untapped resources. We need 
to use that too.
  Senate Republicans are not interested in structuring votes designed 
for failure and designed for political cover. This issue is too 
important to blame for our collective lack of accomplishment. We now 
need to address this vital issue. Energy and gas prices should not be 
politicized and we are not going to walk away and give up on this 
debate. We are here to stay and fight.
  Mr. WICKER. Mr. President, this is an immediate problem and it 
deserves immediate and comprehensive attention. Last week I sent a 
letter to Senate leaders, the majority and minority leaders, to say we 
should not leave Washington for the annual August work period without 
passing energy legislation that will make a true difference for the 
American people. There is no more important action that this body 
should be taking than to address this issue with pragmatic solutions to 
the problem. This is a critical time and this is an important debate, 
the most important debate we could have as elected officials.
  I am encouraged to hear that there are bipartisan discussions going 
on even as we speak to adopt solutions on which we can all agree. I 
know that a bill I would craft might not receive a majority vote in the 
Senate, but there are common solutions that I believe a majority of us 
can and must agree on. The time to act is now.
  May I ask how much time remains in the 10 minutes that has been 
allotted?
  The PRESIDING OFFICER. The Senator has consumed his 10 minutes.
  Mr. WICKER. If I might continue to speak. I see we have no one who 
has asked to speak at this time. When another speaker arrives, I will 
be happy to yield at that point.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
Senator may proceed.
  Mr. WICKER. As I mentioned in my introductory remarks, this is an 
economic security issue. But it is also a national security issue.
  Last week, the LA Times reported that the Pentagon will spend $16.4 
billion on fuel this year--$16.4 billion as compared to $5.2 billion in 
2003. The cost of fuel for our national security has gone up that much. 
This is a major concern for our military. They are having to budget for 
ongoing missions in Iraq and Afghanistan and all of the areas around 
the world in which we are engaged.
  That same article in the LA Times mentioned another important point 
about the need to adopt alternative fuel sources, now more than ever. 
The Air Force, a branch where I served for some 4 years, and longer 
than that in the Reserve--the Air Force is already researching the use 
of coal to liquid for its fighter jets.
  Their goal is to have half of the planes burning coal-based fuel by 
the year 2016, a substance which we have an abundance of in the United 
States of America.
  At these record prices, commercial carriers are beginning to follow 
suit. The Federal Government should encourage and incentivize the 
ventures, doing research on coal-to-liquids.
  Congress has an opportunity to be proactive. We could choose to boost 
our economy by producing more energy domestically, and I am proud to 
join my Republican colleagues in a clear message which I think also 
states an obvious truth: We need to find more resources and we need to 
use less.
  That is the reason I have readily cosponsored the Gas Price Reduction 
Act. We offered it only a few weeks ago, and it gets to the very heart 
of our debate--increasing supply to keep up with increasing demand as 
well as using less through conservation and alternative fuel methods 
here in the United States.
  Both Senator Cochran and I are cosponsors of this legislation. It is 
my hope that we can work together across partisan aisles to come up 
with a solution for America. We do not need political games. We do not 
need to have a limited structural legislative vehicle that allows our 
side only one vote on one proposal which probably cannot pass in its 
current form and allows one vote on the Democratic side for a 
legislative proposal that will also probably not ever see its way to 
the statute book. We need to do something about this problem. And this 
year, these few remaining days of this legislative session comprise the 
time to act.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, what is the parliamentary situation?
  The PRESIDING OFFICER. The Republican side has 2 minutes 40 seconds 
remaining.
  Mr. DOMENICI. I was a bit late arriving. I ask unanimous consent for 
10 minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DOMENICI. Mr. President, fellow Senators, let me say to you that 
I rise to speak again on what may be one of the most important issues 
facing the American people.
  Let me repeat, today we have before us a bill that addresses 
speculation in the energy business in the United States. I regret to 
tell you that the high cost of gasoline is straining our Nation's 
family budgets. The American people are looking to us to do something. 
Instead of providing some needed relief, the majority has brought a 
speculation-only bill before the Senate with limited debate and 
minimal, if any, opportunity for amendments. I am forced to say that in 
my 36 years in the Senate, I have never seen a problem so big met by a 
proposal or a solution that is so small.
  The other side suggests that at this particular time in our history, 
there is no need to move beyond this, the one bill which the majority 
leader, using extraordinary rules, has brought before us under our rule 
called rule XIV. It has not been before committee, it has not been 
reported out by a committee; just put together in his office. And it is 
the Energy bill supposedly for the end of this year; it is all we are 
going to do, with the American people clamoring for us to do more since 
they are so burdened with the high price of gasoline. The American 
people, by an overwhelming majority, want action. They are getting 
nothing except excuses and evasion.

[[Page S7110]]

  Yesterday, the majority continued to trot out a baseless proposal 
that they are calling ``use it or lose it'' in an attempt to convince 
Americans that despite all the evidence to the contrary, they are 
actually in favor of some domestic production. Make no mistake, if the 
Democrats wanted more production, they would have included in the 
underlying bill, the one I just described that the majority leader got 
before the Senate, if they wanted to address some real energy issues, 
then there is no question that all they had to do was add those issues 
to that bill, and those issues would be before the Senate.
  If we needed any more evidence that most of my colleagues on the 
other side opposed new domestic energy production, it came in the form 
of a canceled Appropriations Committee markup.
  In the news this morning, we read that the majority's spin on this 
decision is:

       On the Interior Appropriations bill, the Republicans had 
     threatened to strike the ban on offshore drilling that has 
     been in effect for nearly 20 years, even though they have 
     been offered a separate vote to strike this ban on the Senate 
     floor. Their rejection of this offer makes it clear that they 
     are more interested in playing political games to score cheap 
     political points than to complete action on the bills that 
     fund America's priorities.

  Can you imagine? I beg to differ. Republicans are not trying to score 
cheap political points, we are trying to get something done--something 
done to deal with the supply and demand imbalance at the heart of this 
energy crisis. Our rejection of the so-called offer to bring up a 
single amendment tells you more about the majority's decision to avoid, 
at all costs, a solution that measures up to the scale of the energy 
problem than it does about the Republican's desire to get our work done 
here in the Senate.
  This ban on production of our own energy resources can no longer 
stand in the face of a growing crisis. What we are talking about now, 
Senators, is that starting 20, 25 years ago, some 27 years ago, the 
Congress of the United States decided, 1 year at a time, in the 
appropriations bills, that they would put a ban on drilling off the 
shores of certain States, until we got to the point where 85 percent of 
all the coastal areas of America have a ban, a congressionally imposed 
ban. You cannot go into those areas using the lease proposals of the 
U.S. Government and give oil companies, large and small, leases to 
drill and find oil and gas for the American people.
  Now, obviously this ban on production of our own energy can't stand 
with today's problems. Those bans started when we were worried about 
oil spills, and they started when we didn't worry about the price of 
oil. They started when oil was so cheap that we did not care about 
producing our own. We could, with reckless abandon, put bans and 
prohibitions on drilling anywhere we wanted and nobody would get hurt 
and the American people would not suffer.
  Such is not the case now. That is why I beg to differ with Democrats 
who say we are here playing some kind of politics. If there is any 
politics being played, it is the politics that is trying to prevent 
Republicans from presenting here on the floor amendments that try to do 
the people's business, that try to use this oil and gas that is ours in 
such a way that it will reduce the price of gasoline at the pump.
  They have called hearings on their own proposals; they have canceled 
them. They have called for markups on their own bills which would 
include these same issues; they have canceled those hearings. They can 
avoid hearing testimony on their own policy proposals. They can avoid 
production votes on their own appropriations measures. They can 
even avoid real production votes on the Senate floor. However, my 
colleagues will not be able to avoid their constituents during the 
August recess.

  Thus far this week, instead of action, we have heard a great deal of 
talk from the other side. We have heard tales of how Republicans are 
``blocking another bill.'' I mean, it is really hard for a Senator like 
this one, who has been here 36 years--this is my last year--I have been 
in charge of energy legislation, been in charge or ranking member only 
for the last 4 or 5 years. Prior to that, I did budget work and other 
work. But in terms of being chairman or ranking member, it is only a 
few years. We got a lot of things done in those few years.
  We are here since the Democratic leader brought a bill to the floor. 
It was his choice to bring it here. He brought the bill here in an 
extraordinary manner. It is now here, it is pending, and it should be 
treated the same as any ordinary bill that is pending.
  It is a bill which allows for any responsible provision to be added 
to it as an amendment and a responsible provision, as we see it, that 
will help with the crisis confronting America and we say any amendment 
that will produce more oil, more gas that will be added to what America 
can drill for and use. That is important. We are not blocking anything.
  Can you imagine, they bring down a bill that does one little thing 
that has been said by most experts to not even be needed. If anything, 
it is a minor problem. And they want to vote on it and go home and tell 
the American people they have done something about the energy problem? 
We turn around and say: Yes, let's do something about it, and we are 
the ones ``blocking'' another bill.
  The majority has said they want something done on energy. This would 
be believable if the leadership on the Democratic side had not clearly 
stated in December that they would pivot away from highlighting 
accomplishments in the coming year, abandoning any attempt at 
accomplishments, and a staged attempt to manufacture the appearance of 
obstruction is transparently political.
  This strategy of campaigning from the Senate floor has weakened the 
institution and left the American people without much needed leadership 
during this energy crisis. Instead of impugning the name of the 
American President from the Senate floor, instead of reading poll 
numbers on the Senate floor, instead of providing daily opinions on the 
status of the Presidential campaigns--Mr. President, I ask unanimous 
consent for 2 additional minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DOMENICI. Instead of providing daily opinions on the status of 
the Presidential campaign and special elections, the Senate could have 
been legislating.
  We have been told that Republicans may be allowed to offer one 
amendment; I repeat that, just one amendment. And I repeat that in my 
36 years, I have never seen a problem so big met by a proposal or a 
proposed solution that is so small. The offer of a single amendment was 
accompanied by a baseless assertion from the majority that they are 
willing to compromise and work together on energy legislation that both 
sides can live with.
  We were told that one amendment from the majority and a competing 
proposal from the minority is how the legislative process is supposed 
to work. I disagree. The Senate passed bipartisan comprehensive energy 
legislation in 2005 and 2007. I was here every moment of it. The 
process for those bills, which passed both Chambers in the Congress and 
were signed by the President, was quite different.
  Take the Energy Policy Act of 2005, for example. And now I will go 
through the history of that one and the two that followed it.
  We devoted 10 days of the Senate's time to debating that measure. 
There were 19 rollcall votes held on amendments, 23 rollcall votes on 
the legislation itself, there were 235 amendments proposed, and 57 of 
them were agreed to. There is a similar story to be told of the Energy 
Independence and Security Act of 2007. Over 15 days, the Senate voted 
on 16 amendments, held 22 votes on the bill itself, saw 331 amendments 
filed and 49 of them agreed to.
  We can look back further, of course, to a time when the Senate 
successfully moved legislation focused purely on environmental 
protection. During consideration of the 1990 Clean Air Act Amendments, 
the Senate devoted 5 weeks to a thorough and open debate. A total of 
180 amendments were offered and 131 were ultimately acted upon by the 
full Senate.
  And yet, we are told that one amendment from each side is how the 
legislative process is ``supposed to work.'' This approach is more 
accurately described as a lesson in how to steer the legislative 
process towards failure. The

[[Page S7111]]

American people want action, not excuses; they want real proposals, not 
political ploys; and they want genuine solutions, not small measures.
  During the recent climate change debate, perhaps it was good that the 
majority undertook a process that was doomed to fail. The cap-and-trade 
bill would have increased gas prices by more than a dollar per gallon, 
and energy prices across the board would have increased as well. But 
now, as a growing majority of Americans from all political camps demand 
more energy production here at home, we have to get serious about doing 
the work that we have been elected to do. Advancing a bill that focuses 
on such a narrow part of the energy crisis we face, stifling the 
ability to offer amendments to that bill, cancelling markups, and 
abandoning hearings are not what the American people want from the 
Congress.
  I am disappointed that we will not be offered the opportunity to act 
in a real way this week on the most important issue facing the American 
people. Despite the majority leader's assertions about the recent 
decline in the price of oil, talking will not solve what all experts 
say is a supply and demand imbalance. Solving this problem requires 
action and leadership. I hope we will see both before we depart for our 
home States in August.
  It is pretty clear to me, and I think we are able to make it pretty 
clear to anybody who is interested, that now is the time to pass 
meaningful legislation that will help the American people through the 
crisis of the high prices of gasoline. While we are building a major 
plan and have come along with a minor plan, in a couple weeks we could 
knock out a very good bill. I am willing to sit down, bipartisan. If 
the majority side is willing and the chairman of the committee is 
willing to invite me, I will be there. Maybe we can do it. Thus far, it 
seems it was not possible. So we are trying the best we can to do the 
work for the American people. That means good amendments to a pending 
bill which we did not bring up, but it is there for us to use, pursuant 
to our rules.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Pennsylvania.
  Mr. CASEY. Mr. President, I ask unanimous consent to speak as in 
morning business for up to 10 minutes.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.


                             Housing Crisis

  Mr. CASEY. Mr. President, I rise to talk about the housing crisis 
which has gripped the United States for many months now, more than a 
year, but especially to talk about the bipartisan work done in the 
Senate and across the Capitol in the House. I commend the work of 
Chairman Dodd and Ranking Member Shelby from the Senate Banking 
Committee, as well as Chairman Frank on the House side, for their 
efforts to put together a bipartisan piece of housing legislation which 
will have the effect of stemming the tide of foreclosures and bring 
some measure of relief to families. We know the data, the statistics, 
which bear repeating. Every weekday in America, only because 
courthouses are not open on Saturday and Sunday, some 8,500 families 
begin the foreclosure process or take some step in the process of being 
thrown into that nightmare. Every day that happens. No day does it not 
happen. We are thinking today about those families and their problems 
and their lives.
  We think about the necessity of this legislation on a lot of days, 
but today the New York Times reported the average 30-year fixed 
mortgage rate went, from last week, from 6.44 percent to 6.71 percent, 
in a matter of days going up by that much. For a lot of those families, 
interest rates are going up. The misery and the nightmare of 
foreclosure is overwhelming them. It is incumbent upon the Senate and 
the House and the administration to do something about it, not just to 
keep talking about it but to do something about it. Fortunately, there 
are people who have done that.
  One of the elements to this, of course, is dealing with the crisis 
which has gripped the two largest providers of mortgages, two entities 
in our system that provide as much as $5 trillion--it is hard to 
comprehend that number--of our mortgages, Fannie and Freddie, as we 
know them by their commonly known names, using that terminology.
  In the first quarter of this year, 70 percent of all new mortgages 
were provided by Fannie and Freddie. These two government-sponsored 
enterprises, described as mortgage giants, have a tremendous impact on 
our mortgage market but also have a tremendous impact on our economy 
here at home and around the world. We cannot let them fail. Some people 
will talk about what Secretary Paulson has proposed and others about 
Fannie and Freddie, and they will say how much does it cost. That is an 
appropriate question. There are a series of questions I have asked that 
I will get to in a moment. The other question we need to ask is: What 
is the cost of letting them fail? That is why this bipartisan effort 
has been so important.
  I commend Secretary Paulson for doing an extraordinarily difficult 
job under difficult circumstances. He has worked hard. He has tried to 
find common ground. I haven't always agreed with him. I am sure he has 
not always agreed with me and every Member of the Senate and the House, 
but I think he has worked hard with both parties to try to work 
something out.
  It is very simple. If Fannie and Freddie are going to come to the 
Congress and say, we need your help, we need a line of credit, and we 
need to have the authority to purchase equity, then we say, last time 
we checked, we were elected by taxpayers. So if you are going to ask us 
for help, we are going to ask you questions and demand that you put on 
the table and we put into any agreement the kind of principles any 
taxpayer should have a right to expect. That is the exchange. They want 
help, and we will give them help. We think it is important to make sure 
they don't fail. But if they are going to get the help, they have to 
put some principles in place. So Fannie and Freddie, those major 
organizations--institutions--have to bring some measure of 
accountability to their own practices.
  I looked at a chart yesterday. I am using round numbers here, but 
they are not off by very much, to generalize. If you look at the top 
people at Fannie and Freddie, about 13 people, when you add up bonuses 
and salaries and other incentives, it is about $76 million in 2007. So 
if 13 people are getting $76 million in 1 year, you better believe 
taxpayers have an interest in this. I think Fannie and Freddie have 
still a ways to go. Even if the House does their job today and passes 
this legislation, even if the Senate passes it, Fannie and Freddie have 
to prove to taxpayers, these two mortgage giants have to prove to 
taxpayers that they are going to be accountable, that it is not just 
symbolic. They have to put practices in place and measures in place.
  I have asked for that. I have said both of them should pursue 
litigation, if it takes that, to recover excess bonuses. They should 
make sure that when they make any agreement on stock purchases or any 
other benefit to their executives, that they have to consider steps 
that will hold them accountable, in addition to all the other 
safeguards taxpayers have a right to expect, if taxpayers are going to 
help them. Again, I support making sure we don't let these two fail, 
but taxpayers have an interest here.
  One of the other features of the bipartisan legislation is that in 
order for Fannie and Freddie to work well, to be effective in the 
mortgage market, we have to have a tough, independent regulator for 
both. That is what we worked out in the Banking Committee. The 
Presiding Officer knows of our work. We have worked that out as part of 
the legislation. It is critically important the American people know 
that part of the non-Fannie and Freddie part of this housing 
legislation is a provision that speaks to how we regulate their 
activities. In addition to working on any kind of help that we are 
going to give Fannie and Freddie, the Banking Committee and people in 
this Chamber have a real concern about making sure we have a strong, 
independent regulator in place.
  Two more points, one of which is on community development block 
grants. Thank goodness that apparently Secretary Paulson and others, I 
and others have called upon the President to lift his veto threat and 
to stop using help for local communities as an impediment to signing 
housing legislation

[[Page S7112]]

which is needed to stop those 8,500 foreclosures every day of every 
week. Apparently, from what we hear today, the President has, in fact, 
lifted his veto threat. Thank goodness for the housing market. But also 
thank goodness for families across America, especially those who might 
be 1 of those 8,500 every day of every week in the near term, before 
families fall into that dark hole, that nightmare we hope this 
legislation will help.
  Community development block grants are one way to help here. There is 
no reason why local communities, those local officials who are closest 
to the problems and closest to the people, there is no reason why they 
shouldn't get the help they need through this legislation. There are a 
lot of other provisions we could talk about in the legislation, but I 
wish to commend the work done by the committee, the Banking Committee, 
by Chairman Dodd, Ranking Member Shelby, and Chairman Frank on the 
House side. This, in the end, is not about some esoteric Fannie Mae or 
Freddie Mac issue. It is not about some distant theoretical housing 
issue. This is about real lives and real families. Many of them are not 
just struggling with impending foreclosure and the devastation that can 
bring; this is about families also who are paying the highest gasoline 
prices we have ever seen in American history, paying higher health care 
costs, paying college tuition costs, paying the higher cost of food. 
This is one of many problems that has been heaped upon middle-class and 
low-income families.
  This legislation will provide some relief. I am thankful the House is 
working on it today. I look forward to prompt passage in the Senate and 
having President Bush sign it into law.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Louisiana.
  Ms. LANDRIEU. Mr. President, I come to speak basically about the need 
for more energy production as well as more conservation. Before I do, I 
would like to follow up on the comments of my colleague from 
Pennsylvania. This housing bill we have all worked on for quite some 
time now is hopefully going to be passed by the House. The President 
has withdrawn his threatened veto. It looks like this major piece of 
reform will finally come to pass. I thank Chairman Baucus, Chairman 
Grassley, and Chairman Dodd for including in that bill, before it left 
the Senate, an extremely important provision for the State of Louisiana 
and Mississippi, the whole gulf coast, that will provide some 
significant tax relief to people who had received Road Home benefits 
based on the extent of their damage, whether they received a $20,000 
grant or a $50,000 grant or a cap at 150, to try to make them somewhat 
whole.
  This is not making people whole along the gulf coast. But if their 
insurance failed them or they were in a place that was not a flood 
plain and didn't have insurance because they weren't in a flood plain 
but lost everything anyway because of the magnitude of the storms, we 
allow them an opportunity for a grant to rebuild. It is working. It has 
been very slow. It has been painful. The programs were not established 
correctly initially, but both Mississippi and Louisiana are making 
great progress. The problem was, these grants would have been taxable, 
putting people in a tax bracket where they would have to write a check 
to the Federal Government for $5,000 or $15,000 or $20,000. It would be 
impossible for them to do that under these circumstances. So this bill 
has corrected that. They will still have to pay regular taxes but not 
on these Road Home grants. It is basically a billion-dollar direct 
relief to homeowners in the gulf coast. We could not be more grateful 
to the Members, to the Presiding Officer and others who voted to 
include that and particularly to the chairman. If any homeowners in 
America need help, not just the ones who were foreclosed on through no 
fault of their own but most certainly the 300,000 homeowners who lost 
their homes because these storms took everything they had, we are very 
grateful for that help in housing.
  I wish to speak about energy. There have been a lot of charts and 
graphs put up because this is a dynamic and tense debate. There are 
legitimate issues on both sides. I wished to bring a new chart that can 
explain the situation at least much more clearly. The facts are that in 
the United States, along the Outer Continental Shelf which is off our 
shore, there is currently now a moratorium along the west coast, along 
the east coast from Maine to the top of Florida, and on the eastern 
side of the gulf. This goes out 200 miles from State waters, and it is 
now off-limits to exploration.
  Meanwhile, Canada, our friendly neighbor, is drilling right here off 
their entire coast.
  I do not know how much they are producing off this coast, but it is 
substantial resources. Right here in the gulf, off the coast of 
Louisiana, Mississippi, and Texas, as you all know, we have a long 
tradition of believing that natural resources actually belong to the 
public, and we should be exploring these resources for the benefit not 
just of our region but for the Nation.
  Most of the oil and gas--basically a third of the oil and gas--of the 
Nation is coming off the shores of Texas, Louisiana, Mississippi, and, 
to some degree, Alabama, despite the no-drill zone or no-exploration 
zone off Florida.
  Now, interestingly enough--which is what is partly driving a change 
in this debate--is this area right here, as shown on the map, which is 
off the coast of Cuba but very close to Florida. It is currently being 
leased for drilling by the Chinese, by European powers. So the fact is, 
while we sit and lock up our resources off our coasts, China and Europe 
are coming in and drilling closer to the land of the United States than 
we are allowing ourselves to drill, which does not make sense.
  What we need to do to get prices down is to increase the supply of 
oil and gas domestically and--and--significantly reduce our usage of it 
by moving away from gasoline-only vehicles. It does not mean we all 
have to move from big cars to tiny cars. It does not mean our farmers 
have to give up their pickup trucks. It does not mean our truck drivers 
have to park their big vehicles and sit on the side of the road.
  What it does mean is we can, through legislation, build new trucks, 
new cars, and new pickup trucks that get 50 miles a gallon or 60 miles 
a gallon and not just gallons of gasoline but gallons of ethanol 
produced from corn or from sugarcane or cellulosic matters or fiber or 
waste, municipal waste.
  So we need to look and see where we can drill safely in these places. 
There is drilling allowed right now in Alaska but very limited. 
Although it is allowed, it is limited. We need to look at how we can 
accelerate this drilling. The great news is--even though I support 
drilling in ANWR; we do not have enough votes to do that--ANWR 
represents this tiny dot, a dot. We should not stop fighting about 
ANWR, but we should also think about other places in Alaska where we 
could drill safely and open exploration in limited places, providing a 
buffer zone for States and providing very strategic care.
  One myth I wish to correct today--because it is a rampant myth--is 
that there is hardly any oil and gas off our coast. People will come to 
the floor and say: The Senator is correct. This is off-limits to 
exploration, but the reason it is is because there is no oil and gas 
there.
  That is not true. I know people are not purposely misleading because 
they are citing statistics from old material. But I wish to give you 
some statistics that will prove my point.
  The estimates come from Minerals Management through the Energy 
Department. In 1995, the Government was making estimates of what was in 
the Gulf of Mexico. They said, in 1995, there were only 5 billion 
barrels of oil in the gulf. But when they started drilling more and 
exploring more and using new technologies, we have now determined there 
are 20 billion barrels of oil.
  So in 1995, the same group that is doing these estimates here, said 
in the gulf there was only 5 billion barrels. But after we did the 
right kind of exploration and testing, we actually found more than 20 
billion. That was in 2000. So the idea is that today, if we would allow 
the inventory to take place right now, the estimates might be that 
there are only a few billion barrels. But based on the experience we 
have in the Gulf of Mexico, we know it is going to jump considerably.
  We are the only country, to my knowledge, in the developed world that

[[Page S7113]]

has not even explored or taken an inventory of what the resources are. 
In those days, we did not have the kind of technology we have today. So 
we can use modern 3D seismic technology. I am going to suggest we do 
not have to wait until 2030. We do not have to wait until 2040. There 
is infrastructure in place now in this part of the Gulf of Mexico, and 
it could be established in some other places as well, to go after the 
oil and gas that is there that this country needs to increase our 
domestic supply.
  Mr. President, I know I only have 1 more minute to close.
  As you know, people from this Chamber send letters overseas.
  Mr. President, I ask unanimous consent for 1 more minute.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  The Senator is recognized for an additional minute.
  Ms. LANDRIEU. We keep sending letters overseas asking everybody else 
to increase production so they can send us oil and gas. Yet off our own 
shore, we have great resources of oil and gas for which we must make a 
breakthrough and open for exploration.
  So I know my time is wrapping up now. I wish to come back to the 
floor and talk about the safety and the new technology.
  I am going to show one picture in the Chamber. This is what an 
offshore oil rig looks like. There is a platform on top of the water, 
which a lot of people have not seen. But you can see these off the 
coast of Texas and Louisiana. We like the way they look. It talks about 
money and independence. That is what it means to us. It can be done 
quite safely. This is as blue as the water looks, with lots of fish 
around those rigs. The pipelines are down on the ocean floor.
  So I will come back and talk more about the new technologies that 
allow us to drill safely. But I hope the facts I have shared help us to 
come to terms with opening more resources in the United States.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Kansas is 
recognized.
  Mr. ROBERTS. Mr. President, I rise with my colleagues to help explain 
the need--the crucial need--for comprehensive action on the Nation's 
most pressing domestic issue, as explained so eloquently by Senator 
Domenici. We all owe him a debt of gratitude for his leadership and his 
service in the Senate.
  This is a national issue. But I wish to focus on an individual 
because this affects individual people and families as well as it being 
a national and domestic energy issue.
  Never was the energy crisis made so clear to me than when I met with 
John Grau, a Kansan who runs a cattle operation--or did before a 
tornado--near Soldier, KS. I visited with John at what used to be his 
home, until a June 11 tornado reduced it to a basement, opened to the 
sky except for a fruit closet, of all things, with the fruit jars still 
there. What a miraculous thing. He and his wife had taken shelter and--
also a miracle--they had survived, thank the Lord.
  Despite everything he had been through and everything he would face 
as he would begin to recover from his losses--we were standing there, 
looking at what used to be his ranch and what used to be his home--he 
wanted to talk about gas prices. He said: I am going to be all right, 
after the storms. I can make it back. Look at the 200 friends here 
helping me. But Congress has to do something, he said, because the high 
cost of gas was a crucial hardship for his employees, his neighbors, 
his friends, and his future.
  Now, I have been retelling this story because it is important for 
those engaged in the debate to understand how high prices are affecting 
real people and that we need real answers and we need them now.
  Now, when I hear those on the other side of the aisle criticize our 
proposals on the basis that it will take several years for new oil and 
gas to hit the market, I am reminded that over the last two decades 
this body has held over 20 votes on energy production. That is 20-plus 
votes on deep sea, oil shale or Alaska production that have been 
blocked by my colleagues.
  The only thing that has changed in this surreal argument is energy 
prices and gas prices have continued to increase to a crisis level 
proportion. Twenty years of policy that increased our reliance on 
foreign oil is enough. That is why the American public is calling for 
us to change course and to do it now.
  They know we cannot tax or regulate our way out of high energy 
prices. We must enact a long-term, comprehensive strategy that steers 
the Nation in the right direction so we are not at the mercy of foreign 
interests.
  This is also a matter of national security. We do not want to be 
dependent on people with names such as Ahmadinejad and Putin and 
Chavez. It is not only about John Grau. As I have said, it is a matter 
of national security. But John Grau is the individual who is being 
hurt, similar to so many millions of Americans today.
  The answer is pretty simple: Adopt policies that lessen demand on 
energy and create more energy here at home, from sources we can depend 
on. We need action on this strategy, and we need it now.
  The Gas Price Reduction Act takes these necessary steps. The bill 
would tap as much as 14 billion barrels of oil along the Atlantic and 
the Pacific. The legislation would also open three times the oil 
reserves of Saudi Arabia through Western State oil shale exploration.
  Now, some of my colleagues want to paint this side of the aisle as 
advocating for drilling only. It is obvious they have not read our 
proposals. Yes, we--and the majority of Americans--support increased 
domestic production. But we also support reduced consumption and 
increased transparency, oversight and efforts by the CFTC regarding the 
futures markets.
  Our policy position does not stop at ``find more.'' Our message--and 
the message from my constituents--is: Find more and use less.
  Our bill encourages alternative sources of energy, including plug-in 
electric vehicles through the development of better batteries to 
maximize electricity range and use less gas.
  Our bill is the latest in a number of actions we have taken to reduce 
demand on foreign oil and increase production of clean energy here at 
home. In 2005, we passed the Energy Policy Act that developed 
incentives for ethanol production. In 2007, we passed the Energy 
Independence and Security Act, which improved vehicle fuel economy by 
increasing CAFE standards and provided incentives to develop cellulosic 
ethanol, the next generation in ethanol production. I might add, in 
regards to the CAFE standards, it was also with the cooperation of the 
automobile industry, for the first time.
  Limiting our efforts to only address concerns about speculation 
ignores the root cause of higher prices, and that is production. The 
President lifted the ban on offshore exploration. All that is left is 
for Congress to act.
  Again, clearly, the next step is action on a long-term comprehensive 
energy solution for the Nation which would increase the supply of 
affordable, clean domestic energy. We can start by passing the Gas 
Price Reduction Act. However, the alternative on the floor--the bill we 
are debating--is the majority leader's speculation bill, and it has 
been proposed basically on the floor. It did not go through the 
committee process. The President's working group, working on the very 
same problems, has strong concerns with this bill.

  The Interagency Task Force on Commodity Markets' preliminary report 
just came out and also shows that supply and demand is the driving 
factor in energy price increases. Another final report will hopefully 
be out in September.
  Now, concern for the unintended consequences of this so-called 
speculation bill is precisely why we must engage in an open and fair 
debate where ideas and all pertinent proposals are discussed and should 
be voted upon. The American people deserve no less. However, that is 
not happening. That is not happening, and that is an egregious error.
  Our constituents expect and deserve more from their Senators. They 
need solutions--real solutions, comprehensive solutions--and they need 
them now.
  I harken back to my comments in regard to Kansas cattleman John Grau 
looking over his home and ranch, completely destroyed by a tornado. He 
said

[[Page S7114]]

it best: I can make it back, Pat, but Congress has to take real action. 
We should--we should and eventually we will--find more and use less. I 
completely agree with John Grau.
  I yield back the remainder of my time.
  The ACTING PRESIDENT pro tempore. The Senator from North Carolina is 
recognized.
  Mrs. DOLE. Mr. President, it is imperative--imperative--that American 
leaders declare war on high gas policies and implement policies to 
achieve energy independence. We are almost 60 percent dependent on 
foreign sources of oil, from the likes of Iran's Ahmadinejad, Russia's 
Putin, and Venezuela's Chavez, all of whom harbor anti-American 
sentiments and get richer while American families are suffering and our 
businesses are hurting terribly.
  To secure our energy future, America needs what I would call a 
``kitchen sink'' policy. We need to throw everything and the kitchen 
sink at our energy crisis--conservation, alternative energy, 
exploration, and market fairness. We need policies that provide 
immediate relief as well as short- and long-term solutions.
  I urged that we halt deposits to the Strategic Petroleum Reserve, and 
we successfully passed legislation to that effect. I support right now 
releasing one-third of the current reserves which would increase 
supply, drive down prices, and signal to speculators that the U.S. 
Government is dead serious about addressing high gas prices.
  It is also important to protect consumers from illegal market 
manipulation and corporate corruption. I, along with some of my 
colleagues, am calling for an oil and gas market fraud task force to 
police oil speculators and ensure that energy markets are functioning 
properly.
  As we know, the Senate is currently considering a bill to rein in 
energy market speculation, and I agree that additional enforcement and 
transparency can help better manage these commodities that are critical 
to our economic and national security. We should move forward with 
responsible actions, but cracking down on speculators alone will not 
solve our gas price woes.
  We must also decrease demand and increase supply. Rising gas prices 
are driven primarily by supply and demand imbalance in global energy 
markets. Last year, global demand exceeded supply by nearly 1 billion 
barrels per day. The result: Over the past year, gas prices in North 
Carolina have increased by more than 30 percent.
  To decrease demand, I strongly support conservation efforts and 
investments in alternative energy research. No question, America needs 
a crash course in conservation. I have cosponsored numerous bills to 
pursue these goals, including the Clean Energy Investment Act, the 
Climate Security Act, and the Clean Energy Tax Stimulus Act.
  To increase supply, we also must utilize America's vast energy 
resources. Surely, bringing these energy resources on line will not 
happen overnight but, if anything, that means we should move more 
quickly to pursue them. For instance, if President Clinton had not 
vetoed legislation in 1995 to open 2,000 acres of the 19 million acres 
in remote areas of Alaska for exploration, our current energy deficit 
would already be reduced by roughly 1 million barrels of oil a day.
  After careful consideration, I support lifting the moratorium on the 
Outer Continental Shelf--OCS--giving States the option of allowing 
exploration at least 50 miles offshore, where it is not visible from 
land. A portion of revenues generated from leases would go to the 
States and could be used for dredging and beach renourishment and other 
coastal priorities. Families struggling with high gas prices cannot 
afford for Congress to keep energy options off the table. They must all 
be on the table.
  I am excited about lifting restrictions on oil shale exploration in 
the Rocky Mountain West. With the potential for oil shale to produce 
more than three times the proven reserves of Saudi Arabia, we can ill 
afford to further delay utilizing this American oil resource.
  However, we should not explore for more petroleum at the expense of 
alternative energy. We must pursue all available resources, including 
nuclear, clean coal, natural gas, wind, solar, and biofuels.
  Along those lines, let me add that not only are families being 
slammed with high energy costs, but they are also being hit hard with 
escalating food prices. I am very concerned that food-to-fuel mandates 
have resulted in a substantial volume of our corn crop and vegetable 
oils being diverted into ethanol and other fuel supplies, severely 
impacting food and feed prices. In fact, since February 2006, the price 
of corn has increased by more than 200 percent, and this has caused 
feed price increases that impact the cost of basic items such as milk, 
eggs, and meat.
  During consideration of the 2007 Energy bill, Senator Inhofe and I 
tried to include a safeguard in the renewable fuel standard which would 
have helped prevent a situation such as we face today. The 
administration should waive the mandates, and we need to correct these 
unintended negative consequences where an excessive amount of corn and 
vegetable oils have gone to ethanol production. This is having an 
impact worldwide and emptying the shelves of our food banks and our 
food pantries. Alternative energy must absolutely be a part of our 
energy future, but there are obvious and painful lessons to be learned 
from the ripple effects of these mandates.
  One day we will be free from the stranglehold of high gas prices and 
dependence on foreign oil. We will power our economy with alternative 
energy sources, and no longer will the petrotyrants in Iran, Venezuela, 
and Russia be able to hold the world economy hostage.
  However, to get there, we are going to have to throw everything and 
the kitchen sink at our energy crisis. I call on President Bush to hold 
a national summit now for congressional and national leaders to come 
together and develop a comprehensive plan. The time is now for 
realistic, bipartisan solutions to provide families and businesses with 
immediate relief to meet our energy needs for the short term and to 
secure our energy independence for the future.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Republican whip is recognized.
  Mr. KYL. Mr. President, I think Senator Dole's idea of the kitchen 
sink approach is right on target. Maybe we will even find a way for the 
kitchen sink to somehow help us out here, but at least it is everything 
but the kitchen sink that Republicans are suggesting is the answer to 
our oil crisis.
  There isn't just one answer. That is why we don't agree with the 
Democratic bill, which is simply to deal with speculators and 
speculation. I am going to talk about that in a moment. First, to 
reiterate what Senator Dole said, Republicans support a broad-based, 
balanced approach to this problem that recognizes there isn't one 
silver bullet, but through a combination of things such as 
conservation, such as renewable energy, such as producing a lot more 
oil and gas which this country has. Also, if we will simply lift the 
moratoria that currently preclude us from exploring for more energy, 
deal with speculation to the extent it exists, as well as certainly 
nuclear power--all of these things together can help us work our way 
out of the crisis. Part of it is short term, part of it is medium term, 
part of it takes long term. We have to look at this as a long-term 
problem.
  I shake my head at those who say: Well, that particular solution 
doesn't do anything for 3 to 7 years. My answer is, of course, I have 
never completed a journey I didn't start. If we had completed some of 
the things we started years ago, we wouldn't be in the crisis we are in 
right now. However, we are stuck right now with one bill on the floor. 
Unfortunately, it is not the Republican approach, which is a balanced, 
broad-based approach, and includes new production, but simply the 
limited approach of dealing with so-called speculators.
  I wish to talk a little bit about why only focusing on speculation 
isn't going to produce one more drop of oil, it is not going to reduce 
the price at the pump, it is not going to solve the problem and, in the 
long term, could actually hurt, and I will try to explain why.
  It is propitious that yesterday a report came out that supports what 
I am now saying. We didn't have anything to

[[Page S7115]]

do with the timing, but I say it is propitious because it helps to 
answer questions that people have been asking. For over 3 months now 
the regulatory body of our Government that looks at speculation, called 
the Commodity Futures Trading Commission, has been testifying, and 
despite enormous pressure from the other side to point the finger at 
speculators, they have consistently said they don't think it is 
speculators. We believe it is the law of supply and demand, the fact 
that there is much more demand for oil than we are producing that is 
creating a problem.
  Well, an interagency task force led by the CFTC and composed of staff 
from the Departments of Agriculture, Energy, Treasury, the Federal 
Reserve, the Securities and Exchange Commission, and the Federal Trade 
Commission all reaffirmed yesterday that:

       Current oil prices and the increase in prices between 
     January 2003 and June 2008 are largely due to fundamental 
     supply and demand factors.

  Furthermore, the report--and again I am quoting:

     suggests that changes in futures market participation by 
     speculators have not systemically preceded price changes. On 
     the contrary, most speculative traders typically alter their 
     positions following price changes, suggesting that they are 
     responding to new information--just as one would expect in an 
     efficiently operating market.

  The other side has ignored this CFTC analysis for a long time. I hope 
the new report will not be ignored, because what it illustrates is you 
are not going to solve this problem by trying to figure out a way to 
somehow regulate speculators. You have to deal with the law of supply 
and demand.
  I tried to explain this to a younger person who was wondering what 
all of this debate was about, and this is the example I came up with--
or the analogy: These are investors, these so-called speculators, and 
what they are trying to do is to predict into the future what the price 
of something is going to be. Now, if they guess right, they can make 
money. If they guess wrong, they may lose money. They are researchers 
and they are looking at the best evidence they can. One of the things 
they look at is will there be more supply or more demand. Obviously, if 
there is more demand, then the price is going to go up. It is a little 
bit like the weatherman predicting the weather. The weatherman is a 
professional too and he looks at all of the research and he concludes 
that by this weekend we are going to have some rain. Now, he may be 
right, he may be wrong, but that is his job, to try to predict, and 
more often than not, he can predict it fairly accurately. What if we 
don't want rain next weekend? What if we don't think rain is a good 
idea? Are we going to muzzle or fire the weatherman and say: We don't 
want you to report this because we don't want the rain? Is that going 
to do any good? It doesn't do any good at all. If it is going to rain, 
it rains. If not, it won't.
  If the prices are going to go up because Iran is rattling its sabers 
in the Persian Gulf, the prices are going to go up. If they don't, and 
the prices don't go up, it is not the speculators who make the price go 
up or down. The speculators are reporters. They are people who are 
trying to figure out what the price is going to be. They don't make it 
what it is; they are trying to figure out what it is going to be.
  That is why the CFTC said they typically alter their position 
following price changes, reacting to new information. Again, it would 
be like trying to shut the weatherman up because we don't like the 
weather he is predicting. That is the role these speculators have. They 
are trying to predict the future and they actually help the market by 
setting a price that is useful to those who are trading in the market.
  I appreciate that there are colleagues on the other side who are 
skeptical about this, but let me explain why I think it is unlikely 
that commodity traders actually push up the price of oil. Here is the 
explanation. They can only do this and drive up prices if they actually 
took physical possession of the product and then hoarded that, withheld 
it from the market.
  But between 2003 and May of 2008, only about 2 percent of oil futures 
contracts actually resulted in physical delivery. Those are the 
utilities, airlines--folks like that.
  If commodity index fund investors were, in fact, hoarding actual 
physical inventories to raise prices, one estimate suggests that they 
would need to fill storage tanks with more than 40 times the amount of 
oil currently held in the inventory at the Cushing oil terminal in 
Oklahoma where the West Texas intermediate oil contract is valued. 
Since we have not seen all of this frenzied new construction of oil 
storage tanks and facilities equivalent to 40 Cushing oil terminals, it 
is very clear that there is no hoarding occurring.
  What is actually happening to supply today? Total oil stocks in the 
developed countries have been static. In other words, we have not been 
increasing the supply. A year ago, including strategic reserves, they 
amounted to about 4.1 billion barrels and today are at about the same 
level. Global demand, on the other hand, was 86 million barrels a day 
in 2007, while supply totaled 85.5 million barrels, creating a deficit 
of half a million barrels a day. As one would expect, prices are rising 
to reflect the fact that there is not as much supply as there is demand 
for the product.
  I also think it is interesting that when you talk about speculators, 
you know the price has been going down in the last few days. I haven't 
heard anybody complaining that the price of oil is going down. If they 
are to blame for the price going up, maybe we ought to pat the 
speculators on the back for driving the prices down. Of course, they 
don't have that effect; I am being facetious. But who are these 
nefarious investors?
  If you have a relative who is retired or a friend or someone who has 
a pension, you probably know a speculator. That is who is primarily 
investing in these kinds of funds. All investors want to diversify 
their portfolios to protect themselves against risk. You do that by 
purchasing as many different kinds of assets as you can, by investing 
in commodities. Pension funds and other institutional investors can 
protect beneficiaries like retirees from market downturns. In the 
current market, commodities are one of the few investments that have 
been actually generating positive returns. Under the legislation before 
us, if you declare these people bad investors or illegitimate 
speculators, you are going to be hurting regular investors in the 
market. I don't think we want to do that.
  Interestingly, one of the pieces of legislation the Republicans have 
sponsored--the legislation called the Gas Price Reduction Act--is very 
similar to a bill introduced by my colleague from Illinois, Senator 
Durbin, who I think takes a thoughtful approach to speculation in the 
energy markets. Like our bill, his focuses primarily on increasing the 
resources available to the CFTC so it can continue to do its job and 
even do a better job of ensuring there is enough transparency in the 
system to enable it to continue to investigate and take action, if need 
be. With just a few modifications, I think the Durbin bill would be a 
good approach, as is the Gas Price Reduction Act, which Republicans 
have introduced, which strengthens the CFTC and makes sure it has the 
assets it needs to do the job we asked it to do.
  In conclusion, I think everybody agrees that a stronger CFTC and 
additional transparency are good. I think we can all support that. It 
is part of that kitchen sink approach we heard talked about earlier, 
but it is only one small part of this. In no way are we going to see 
that approach drive down the price at the pump. As I said, it is little 
bit like the weatherman, these speculators. They find out what the 
price is and they, in effect, report it by their purchases or sales--
either one. But you don't improve anything by killing the messenger--
the speculator--any more than you improve the weather by shooting the 
weatherman.
  As we proceed with the debate, I hope my colleagues will agree that 
while there may be a lot of good ideas--and one may be to strengthen 
the CFTC somewhat--that is not the answer to the crisis we face. It 
doesn't produce one more drop of oil or gas. At the end of the day, we 
are not going to be successful unless we find a consensus to enable us 
to produce more so that, along with using less, we can drive down the 
price of gas at the pump.
  The ACTING PRESIDENT pro tempore. The Senator from Minnesota is 
recognized.
  Ms. KLOBUCHAR. Mr. President, it is now Wednesday, and we have been 
debating the issue of speculation for

[[Page S7116]]

several days. I believe it is time to stop talking and it is time to 
vote to end speculation in the oil marketplace.
  There is an honest debate going on about our long-term energy 
policy--one I am glad we are having. We need to talk about the 
potential of expanding our domestic production and about new 
refineries. I live next door to North Dakota, and I see their potential 
with the oil shale. Certainly, as T. Boone Pickens has been doing over 
the last few weeks, we need to lead the way with wind, solar, and to 
put the focus on hybrid and electric cars, biofuels, as we have seen in 
Minnesota. We have seen a revival in our rural areas with wind. We are 
third in the Nation with wind. We have seen it with biodiesel, 
biofuels.
  I have seen firsthand the potential for this next energy revolution. 
It is my belief that we should be investing in the farmers and workers 
of the Midwest and not the oil cartels of the Mideast. So I welcome 
this debate, and I hope we can get something done on that.
  Let's look at the short-run. What are the American people facing now 
with $4-per-gallon gasoline? Right now, they don't have the time or the 
patience for us to tell them we are not going to get anything done on 
speculation even though almost every Senator in this Chamber has 
admitted there are problems with speculation and that it is part of the 
problem. We may differ on how much of a problem it is, but we know it 
is part of the problem.
  I believe our Stop Excessive Energy Speculation Act will help to pop 
the oil speculation bubble. This bill has a number of provisions that 
will fight the kind of excessive speculation that drives up energy 
prices for hard-working American families.
  This bill will close the so-called London loophole. It will stop 
traders from routing transactions through offshore markets to get 
around limits on speculation put in place by U.S. regulators. The 
Intercontinental Exchange, or ICE, allows trading on American oil 
futures, gasoline, and home heating oil with far less stringent 
reporting requirements than we have here at home. I can tell you that 
my constituents--it is not great to tell them: Don't worry, Dubai or 
London will be taking care of you. They don't buy that, and they don't 
buy it for a good reason. The way the world has worked now with the 
loopholes that have existed, like the Enron loophole--and I see Senator 
Feinstein, who worked to close that loophole to the point where we can 
better regulate our energy future. We know there is more we can do, and 
that is what this bill contains.
  This bill will make foreign trades in American oil and gasoline 
futures subject to the same reporting requirements as trades made here 
at home, so we can stop a glut of overseas trades from driving up our 
energy prices.
  This bill would also require the CFTC to review the letters of ``no 
action'' that it issued to the ICE electronic exchange in Atlanta, and 
the Dubai electronic exchange, which operates in cooperation with NYMEX 
in New York. With these ``no action'' letters, the CFTC gave these 
exchanges permission to operate in this country and trade in American 
energy futures with no oversight from U.S. regulators. Personally, I 
don't believe it is good enough to say that the Dubai Financial 
Services Authority is looking out for people in my State. We need to 
let speculators know that if they want to trade in American energy 
futures, they are going to be subject to American regulation.
  The bill would also convene an international working group of 
financial market regulators to develop uniform reporting and regulatory 
standards in the major trading centers in the world to put an end to 
the problem of speculators shopping around for the country with the 
weakest regulations. The world has changed. One of our jobs in the 
Senate is not to just put our heads in the sand and pretend the world 
hasn't changed. It has. The laws must change with it.
  This bill would also require the CFTC to impose position limits on 
speculators who trade in energy futures but don't actually produce 
energy or receive physical deliveries of energy commodities. If you are 
an investor who buys and sells oil futures but you don't plan to ever 
take delivery of actual barrels of oil, this bill will limit how much 
you can buy and sell so that you won't be distorting prices for your 
own personal gain. We know some limits are in place right now in 
American laws, and this is to cover the situation we see going on in 
the world today.
  Last, this bill is going to give the CFTC the funding authority to 
hire at least 100 full-time employees so the Commission can strengthen 
its regulations and improve its enforcement over the energy derivative 
market. As a former prosecutor, I know--I have seen it before--you can 
pass all the laws you want, but if you don't have the cops on the front 
line enforcing the law, you will not be able to get the job done. I 
heard the head of the CFTC testify before the Agriculture Committee. I 
was surprised. As a prosecutor, I said: Give me all the tools I need, 
because you want to have the tools. That is what this bill does.

  We have heard from the other side of the aisle that speculation is 
not a major contributor to high oil prices. It is hard to imagine such 
a position, but our friends on the other side seem intent on finding 
some straw to hang on to that just doesn't work. They are literally 
living in an evidence-free zone. Look at what has happened. Oil prices 
are up 25 percent. Gasoline is up 25 percent in 6 months; it is around 
$4. We know demand hasn't gone up 25 percent. Have we seen some 
increase in worldwide demand? Yes, but demand in the United States is 
down. It is nowhere near 25 percent, though.
  We know something is going on. It is our job to adjust our laws and 
give the agency that enforces these laws the funding it needs to do its 
job. We saw this happen with the Consumer Product Safety Commission. 
Exports went way up, millions of exports; at the same time, the agency 
became a shadow of its former self. It is no surprise that we suddenly 
had little foam toys, which were supposed to inflate in water, morph 
into date-rape drugs. We had a little boy in Minneapolis die because he 
swallowed something from a toy that was 99 percent lead.
  You have the same thing going on here. It is this Congress which has 
to step in and say: Let's get the agency the resources it needs to do 
its job. When oil prices jump $16 in 2 days without any events to drive 
them up, we cannot say speculation isn't having an impact. When the 
12th largest private company in the United States is filing for 
bankruptcy after losing billions in oil trading, we cannot say 
speculation isn't having an impact. Even Walter Lukken, the Acting 
Chairman of the CFTC, has stated that oil markets are ``ripe for those 
wanting to illegally manipulate the markets.'' We had an expert testify 
before Congress that speculation in the oil market is the biggest 
gambling hall in America. We had CEOs saying it should be trading at 
$55 or $60 a barrel. Do you know who is taking a hit? It is Americans 
across the country. They are taking a hit every time they go to fill up 
their gas tanks.
  There is no excuse for this Congress not to act on speculation. We 
are listening to the people of this country, and we are hearing that 
this bill--Majority Leader Reid's bill--makes common sense to everyday 
Americans.
  Groups across the country that deal with high gas prices every day 
have come out in support of our efforts to stop the out-of-control 
speculation going on in the oil market. These groups include the 
National Farmers Union, the Teamsters, the Air Transportation 
Association, the Consumers for Competitive Choice, Northwest, and the 
American Feed Industry Association. And the airlines in Minnesota 
aren't exactly partisan organizations. They are businesses. They have 
seen their profits go down. They have seen their routes go down. The 
number of planes they can fly has gone down. They have unhappy 
customers. They have millions of airline customers who are writing in 
to do something on speculation. Speculation is where the rubber hits 
the runway for the airlines in this country. We must do something about 
it. Even the beer wholesalers want to do something about it. I talked 
to one of their members last night. They want to get something done. I 
can tell you that my friends across the aisle say speculation has 
little to do with this. I will use a good beer word: That is all foam 
and no beer.
  It is time to get something done. It is time to act on speculation.
  In conclusion, the cost of energy is hurting Americans from all walks 
of

[[Page S7117]]

life, in businesses and every sector of our economy. We need to work 
hard. I have pushed, in the last year and a half, for a long-term 
energy policy. We need a bold energy policy to carry our Nation 
forward. We also need to do something now--today, not tomorrow, not 
next week, not in September. Let's pass this speculation bill and help 
the people of this country.
  Mr. President, I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from California.
  Mrs. FEINSTEIN. Mr. President, I ask unanimous consent to speak for 
12 minutes.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered. The Senator is recognized.
  Mrs. FEINSTEIN. Mr. President, I wish I could come to the floor and 
say there is a quick fix for gasoline prices at the pump. This is 
needed as much as anywhere in California where gas prices are high and 
at times the very highest. I wish I could say there was this quick fix, 
but I cannot. I wish I could say if we could drill all of the Outer 
Continental Shelf, if we could drill on all of the public land in 
America, the price of gasoline at the pump would drop immediately, but 
I cannot.
  In all good conscience, I do not believe opening the Outer 
Continental Shelf to new drilling would lower the prices at the pump 
anytime in the near future. In the first place, it takes 2 years for 
MMS, Minerals and Management Service, to do the contracts. Secondly, 
all drilling rigs are now leased. There need to be new rigs. Thirdly, 
there is no additional refining capacity. Fourth, drilling in the Outer 
Continental Shelf and on public lands in America over the last 8 years 
has increased by 361 percent and, at the same time, the price of oil 
has doubled. So there is no relationship between drilling on the Outer 
Continental Shelf, drilling on public lands in America, and the price 
of oil. I deeply believe this.
  Some say it is simply a problem of supply and demand, but physical 
supplies of oil and natural gas have remained relatively stable over 
the past year. In fact, if you remember, executives from oil companies 
testified before Congress recently and asserted that the price should 
be about $60 a barrel if it were just a matter of supply and demand.
  Some point to instability in the Middle East and Africa's production 
regions. Others have pointed to the falling dollar. These are certainly 
factors. But I cannot explain the sharp uptick in prices we have seen 
at the pump over the last few months.
  So what is really going on? What is new in this picture? Consumption 
in America has dropped 3 percent this year over the same period last 
year. So what is new? There is only one thing that is different, there 
is only one thing that is new, and it is a massive influx of 
speculation in the marketplace. This is the 800-pound gorilla.
  Increasingly, experts now say rampant speculation in energy markets 
accounts for anywhere from 25 to 40 percent of the energy price 
increase. Some will say even more. So I think we have to take a look at 
why this is the case and what we can do about it.
  In May, Congress took a major step forward in the effort to bring 
more oversight to energy futures markets when we enacted legislation to 
close the notorious Enron loophole. The Senator from Minnesota just 
referred to it. I had worked on this for 6 years. I came to the floor 
when Phil Gramm argued against it. I lost. I got just 48 votes. We came 
back again. We finally got it in the farm bill this time, and the 
notorious Enron loophole today is closed.
  What was that? This loophole was created in 2000 when a measure was 
inserted in the dark of night into a must-pass appropriations bill at 
the behest of Enron and others to essentially eliminate them from the 
Commodity Futures Modernization Act. Two commodities were left out: 
energy and metals.
  During the western energy crisis in 1999 and 2000, we saw the costs 
in my State soar from roughly $8 billion in 1999 to $27 billion in 2000 
and then to $27.5 billion in 2001. The reason for this was, in the 
main, manipulation, fraud, and reckless speculation of the worst sort, 
all because you could trade on electronic platforms with no 
transparency and there was no antifraud, antimanipulation oversight by 
the Commodity Futures Trading Commission.
  When all was said and done, these energy traders left California 
taxpayers with an increased bill of about $40 billion. To date, 32 
companies have pled guilty to market manipulation and settled $6 
billion in claims.
  In recent years, we also saw the $6 billion collapse of the Amaranth 
hedge fund because of unregulated speculation in natural gas futures on 
electronic exchanges. And the list goes on.
  This has typified the energy marketplace. So it became clear that a 
legislative fix was needed. We finally got that done, as I said.
  The bill, which is now law, ensures that all major trades of energy 
futures that could drive up prices or have what is called a price 
discovery impact are placed under the oversight of the Commodity 
Futures Trading Commission. The new law imposes limits on rampant 
speculation, prevents fraud and manipulation, requires traders for the 
first time to keep records, and provides an audit trail to the CFTC. 
This was a significant victory. It is signed into law.
  But as we continue to learn more about what is really going on with 
energy futures markets, it is clear more work remains to be done. We 
are learning about additional loopholes that must be closed, and the 
legislation before us is critical to ensure that we can level the 
playing field in energy markets, that there is transparency there.
  First, the problem of large institutional investors, such as pension 
funds; this is what is new in this market. From 2003 to 2008, 
institutional investments in commodity index funds rose from $13 
billion to $317 billion. That is in 5 years, from $13 billion to $317 
billion.
  One might say, what does that have to do with it? Daniel Yergin, to a 
great extent, said what it has to do with it when he said:

       Oil has become the ``new gold''--a financial asset in which 
     investors seek refuge as inflation rises and the dollar 
     weakens.

  ``Investors seek refuge.'' So the implications are potentially 
devastating, and here is why. Unlike gold, energy and agricultural 
commodities meet essential needs in everyday lives of average people. 
They are limited. They are not potbellies. Energy is limited in the 
amount we have.
  These institutional investors, the big pension funds, such as my own, 
the California Public Employee Retirement Fund, has invested over $1 
billion in these markets. These institutional investors are trading 
long on energy futures prices. In other words, they are betting that 
the prices in these future markets continue to rise. They are not 
hedging against the risk of changing oil prices, as airlines and 
utilities frequently do. They never take delivery of a product. They 
participate in the oil markets only on paper. Yet these investors, the 
big ones, are currently exempt from CFTC regulation when they execute 
these trades through brokers or dealers. These trades are called swaps.
  Currently, the CFTC limits speculation positions to a total of 20 
million barrels of oil and 3 million barrels of oil in the last 3 days 
of a contract. However, these same investors avoid these limits by 
executing their trades as swaps. This is a mistake. Institutional 
investors have become speculators.
  Last month, the CFTC announced that it will review trading practices 
for these investors, and this is a positive step. But legislation is 
still needed to level the playing field and close the loophole. The 
bill before us will limit the size and influence of institutional 
investor positions in energy markets.
  To further increase transparency, this bill also requires the CFTC to 
begin distinguishing between the institutional investor index trader 
and the swaps dealers who broker their trades. This legislation closes 
the swaps loophole, bringing transparency and speculative position 
limits to contracts executed through swaps dealers, in that way 
preventing a price discovery function as much as possible to keep 
prices from continuing to escalate.
  Specifically, the bill gives the CFTC the authority to begin 
collecting data on large over-the-counter traders so that it can 
determine whether price manipulation or excessive speculation is taking 
place. This would ensure that the CFTC has a clear picture of all

[[Page S7118]]

trading in over-the-counter commodity markets.
  The London loophole, what is the London loophole? I think we also 
must prevent U.S. crude oil contracts from being traded on 
international exchanges without robust oversight.

  I ask unanimous consent for 2 more minutes, please.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Mrs. FEINSTEIN. A recent CFTC report found the traders were using the 
London exchange to trade U.S. crude oil futures to avoid U.S. 
regulations--in other words, go around it. Trades exceeded U.S. 
speculation limits every single week since 2006.
  Last month, CFTC announced that it would limit this offshore market 
speculation and require recordkeeping and an audit trail for these 
traders. That is a start. But legislation is still needed to codify the 
regulation. This legislation will require foreign exchanges with 
customers in the United States to adopt the same speculation trading 
limits and reporting requirements that apply to U.S. trades, ending the 
regulatory race to the bottom. This language is based on legislation 
that Senator Levin and I introduced previously.
  I believe very strongly that we must ensure that American energy 
commodities are protected from manipulation and excessive speculation, 
regardless of where the commodities are traded.
  Bottom line, this bill brings transparency, it brings accountability, 
it brings recordkeeping, it brings oversight to the energy markets. It 
would impose sound, proven economic principles to markets that are 
currently broken and where speculation has increased so dramatically 
that it is pushing up the price. It would close regulatory and 
legislative loopholes that prevent the CFTC from enforcing the 
Commodity Exchange Act in energy commodity markets.
  I hope my colleagues will support the bill. I suspect it may not 
pass. I hope it does because there is no question in my mind that the 
800-pound gorilla in the price of gasoline at the pump is excessive 
speculation on commodities futures markets dealing with energy.
  Mr. President, I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Rhode Island.
  Mr. WHITEHOUSE. Mr. President, will you be kind enough to notify me 
when there is 30 seconds remaining so I can conclude without imposing 
on the other party's time?
  Mr. President, today, Rhode Island drivers are paying more than $4 a 
gallon for gas, and they have been paying those prices for well over a 
month now. We all know that 8 years of two oilmen in the White House 
equals over $4-a-gallon gas, a nearly sixfold increase in oil prices.
  These record oil prices have sent consumer prices skyrocketing, not 
only at the pump but at the supermarket and the department store. Food 
and household goods take energy to produce and transport and have 
become more and more expensive. While George Bush and Dick Cheney's 
friends in the oil industry celebrate grotesque profits, ordinary 
Americans struggle to make ends meet. Families in Rhode Island and 
across the country are having to choose between filling their tank and 
feeding their families and between heating their home and buying needed 
medicine. They are frustrated, they are angry, and they are looking for 
solutions any way they can find them.
  Unfortunately, rather than taking steps that will help consumers 
today, the Bush Republicans are now trying to harness Americans' anger 
and frustration and, of all things, use it to capture more inventory 
for big oil. The energy companies have already bought 68 million acres 
of public lands to drill, and they are sitting on it. They are spending 
more buying back stock than they are drilling these holdings. Now, 
rather than drill what they have, they want more.
  The administration and its allies have said that opening more land to 
drilling is the one and only way to lower the price of gas in this 
country. That is flat wrong. The United States owns 3 percent of the 
world's oil reserves and consumes 25 percent of the world's oil. The 
measures endorsed by the administration and its allies would have zero 
effect on gas prices--zero effect for at least a decade. Even then, the 
Energy Information Administration projects these proposals aren't 
likely to make any significant dent in gas prices--cold comfort for 
Americans who have watched gas prices rise by about $3 a gallon while 
two oilmen occupied the White House.
  We cannot drill our way out of this problem, now or ever. But that is 
not all. Even as the Bush Republicans say their only answer to our 
energy crisis is drill, drill, drill, they have repeatedly refused our 
good-faith offer to bring their proposal to a vote. If they are 
confident this is the right solution, then give each of us the chance 
to vote up or down, based on what we think is right for the people we 
represent.
  Why not? Because as we have seen, time and time again, they are not 
interested in finding the right solution, in doing what is right by 
families who need help today. No, the Bush Republicans are much more 
interested in playing politics and pouring more money into the pockets 
of oil companies already reaping world record, history-of-the-universe 
profits. Their proposal would encourage our continued dependence on 
oil, harm our environment, and delay our badly needed transition to the 
vibrant green economy that beckons us. Make no mistake, if the 
Republicans would let us walk through this door, a vibrant green 
economy does beckon American workers and families.
  We need real commonsense solutions that can make a difference now. 
One factor most economists believe has played a major role in driving 
up prices is rampant speculation in the commodities and futures 
markets, something we can address today. Speculators invest in oil 
futures with no intention of taking possession of the commodity itself. 
They have historically played a role in the marketplace, but under 
George Bush's watch, excessive and irresponsible speculation has 
exploded. Experts may disagree on whether speculators have run up the 
price of oil by 10, 30 or 50 percent, but there is broad and growing 
agreement that speculation is a serious problem and that fixing that 
problem can help bring gas prices down now.
  Of course, the big oil companies, and those in Congress who support 
them, say the dynamics of supply and demand, not speculation, is the 
real cause of the massive price increases. There are two problems with 
that argument. First, we have heard testimony from experts who say 
there is no way that simple supply and demand for oil can explain the 
huge rise in energy costs that have plagued American families in the 
last several months. Second, energy speculation has its own supply and 
demand in the commodity market. According to data from the CFTC, 
speculators now control 71 percent of the oil market, up from 37 
percent when President Bush took office.
  The PRESIDING OFFICER (Mrs. McCaskill). The Senator has 30 seconds 
remaining.
  Mr. WHITEHOUSE. I thank the Chair.
  With relatively constant supplies of futures and the dramatically 
expanding demand of speculators, prices have nowhere to go but up. So I 
am here to support legislation that our colleagues have offered to get 
to the bottom of the energy speculation boom. Senator Maria Cantwell, 
in particular, has been a leader, but I wish to commend Majority Leader 
Reid for offering the Stop Excessive Energy Speculation Act of 2008, 
which would address the problem of excessive speculation.
  In the time that remains, I will simply urge my colleagues to take a 
look at this problem. When there is $16 billion that used to chase 
these indexed futures funds and it is now over 300, clearly something 
is going on in these markets that we need to get a look at. We should 
regulate them the way we do other markets, such as grain.
  These funds, which include university endowments and pension funds, 
may unknowingly be helping drive up prices by holding energy assets--
commodities they don't intend to sell or consume--as part of broad 
investment strategies.
  The amount of money in commodity-based index funds has exploded in 
recent years, rising from $13 billion in 2003 to $317 billion today, 
according to one estimate.
  Leader Reid's bill would bring to light the role of index traders in 
the energy market by requiring the CFTC to collect and publish data on 
their

[[Page S7119]]

participation. Greater transparency combined with the new investigatory 
resources that this bill provides will help lower energy prices.
  Do we know for sure that speculation is driving oil prices? Not for 
sure. But we do know two things--one, we regulate speculation in this 
commodity, oil, less than we do other commodities such as grain, and 
two, there is more than enough evidence of excessive speculation to 
prompt a reasonable and prudent person to act.
  I hope the Senate will act quickly to pass legislation strengthening 
the government's authority to crack down on rampant speculation in the 
energy markets and call on my Republican colleagues to take action that 
will help consumers in the near term, instead of resorting to political 
gimmickry.
  I appreciate the courtesy of the Chair, and I yield the floor.
  The PRESIDING OFFICER. The Senator from Tennessee.
  Mr. CORKER. Would the Chair remind me of how much time I have.
  The PRESIDING OFFICER. The Senator has up to 10 minutes.
  Mr. CORKER. If you wouldn't mind letting me know when 60 seconds 
remain.
  The PRESIDING OFFICER. I would be happy to notify the Senator when he 
has 60 seconds remaining.
  Mr. CORKER. You are a most helpful Chair, and I thank you so much.
  Madam President, I rise to talk about energy today. My good friend 
from Rhode Island mentioned how we would like to vote, and I agree with 
him. I think it is an amazing thing that the biggest issue in the 
country today is energy and here we are, in the greatest deliberative 
body in the world, for some reason, not allowed to vote to try to solve 
this particular issue.
  I had a townhall meeting last night. On the telephone, we had about 
1,200 callers at all times. I can assure you that while other subject 
matters arose, the issue constituents care most about today is gasoline 
prices.
  I am part of a bipartisan group that is trying to craft some kind of 
legislation to pass, and we were all asked to put down on a piece of 
paper those things we think ought to be considered and those things 
that should not be considered--five Republicans and five Democrats. 
After we did that, there were many things we all agreed should at least 
be discussed as part of an energy bill. Yet it is fascinating to me 
that when we have an issue of supply and demand--and I think contrary 
to what my friend from Rhode Island said, most economists all agree 
there is a supply-and-demand issue--an issue where we have continuing 
demand throughout the world and in this country and we have lessening 
of supplies and, in fact, the price of oil continues to rise, it is 
interesting to me that when we have this phenomenon of supply and 
demand, we focus on speculation.
  Now, this is one of those bills, unfortunately, Madam President--and 
I know you are from the great State of Missouri and use a lot of common 
sense in the things you have done there--that is a ready, aim, fire 
bill. This is not a bill to be taken seriously. It is a bill to sort of 
take the American people's minds off the issue of supply and demand.
  Let me read a couple of sentences. On page 14, it says:

       Not later than 30 days after the date of enactment of this 
     subsection, the Commission shall impose by rule or regulation 
     speculative position limits on trading that is not legitimate 
     hedge trading.

  The bill is referring to the CFTC in that sentence. Then it goes 
further to say that they will, 30 days after enactment, put together an 
advisory group that, after 60 days, will make some recommendations. 
This is, of course, after the CFTC has already, per this ``shall'' 
language, imposed various requirements and stipulations on hedging in 
place. Then, after that, 270 days after that, this advisory commission 
will look back over what has occurred to see if it is right or wrong.
  This bill is not on the floor to be taken seriously, and I think most 
of us who have talked with people throughout the industry realize that. 
Again, this is something to take the voters' minds off the real issue--
the issue of supply and demand.
  I wish to say to my colleagues on the other side of the aisle that I 
am willing to look at everything there is to look at in the equation of 
supply and demand. There is no question that in a country which has 3 
percent of the oil reserves in the world, has 4 percent of the 
population, yet uses 25 percent of the world's oil production, 
conservation needs to be a big part of it. I would love to talk with my 
colleagues on the other side of the aisle about what we might do in the 
area of conservation. My guess is there would be a lot of people on 
both sides of the aisle who would reach agreement over what we ought to 
do as a country to lessen demand by focusing on conservation.
  Yesterday, in the State of Tennessee, Nissan--a great automobile 
producer--announced their focus on producing an all-electric car by the 
year 2012. I welcome that day. I look forward to the day when I and my 
daughters and my wife Elizabeth drive a vehicle that we plug in at 
night, that is being charged with base load power at low prices and 
that we drive the next day and not use petroleum. Why don't we debate 
some amendments on this floor that have to do with that?
  Much of the discussion has been about offshore drilling, about the 
Outer Continental Shelf. Again, as part of the equation, we ought to 
look at supplies. I am all for looking at additional offshore 
development. I think it only makes sense at a time when we have rising 
demand and lessening supplies. But I would like to talk about a lot of 
other things.
  Again, it is an interesting thing to me that one person, the majority 
leader of the Senate, can decide that we have one so-called speculation 
bill on the floor that, again, majors in the minors. The issue is 
supply and demand. Yet in this body of ``100 great Senators,'' we don't 
have the ability to talk about an issue that is the biggest issue in 
front of the American people.
  I think all of us know right now what I am doing, and this is 
something I am not accustomed to doing, but I am burning up time on the 
floor. The last speaker was burning up time on the floor. Basically, 
what we are doing is waiting to see if later this afternoon the 
majority leader of the Senate will allow 100 grownups--100 grownups 
elected by their respective States--we are basically waiting to see if 
the majority leader of the Senate will allow 100 grownups, who 
represent people all across this country, to actually offer amendments 
that might help solve the supply and demand issue we have in our 
country.
  I think it is very obvious that we, as a country, need to produce 
more and use less. My daughters, 19 and 20, learned this when they were 
in middle school; that there is an issue of supply and demand.
  Again, I wish to meet my colleagues in the middle. I agree that 
conservation, as I have stated before, needs to be a big part of this, 
but it is a diminishment of this body to know that basically all day 
long people are parading back and forth on this floor to make points on 
one side or the other about energy, the biggest issue before the 
American people, and what it is all about is killing time until we find 
out whether the majority leader will allow us--treating us like 
teenagers--allow us to offer amendments. It is an amazing thing.
  It seems to me that if we were going to be serious about this, that 
we would have the gumption to stand here on the floor, offer real 
amendments, talk about those amendments, and hash them out. That is why 
I came to the Senate. I think that is why the Presiding Officer came to 
the Senate and has offered so much in the way of making this body 
function in an appropriate way. So I hope that very soon we will move 
away from these political games and things that might affect the fall 
elections and move to the serious issues the American people care 
about. That is what I came to do.
  Madam President, how much time do I have remaining?
  The PRESIDING OFFICER. There is 1 minute 15 seconds.
  Mr. CORKER. So for 1 minute 15 seconds I will talk about supply and 
demand again, something that I think most of us understand.
  I will say again to my colleagues on the other side of the aisle that 
I am willing to look at every possible amendment that has to do with 
conservation, that has to do with green technology, that has to do with 
additional production, so that over the next 10 years, we don't send 
$10 trillion overseas.

[[Page S7120]]

  We talk a lot about the oil companies in this country, and I know 
there are some things that can be said pro and con, but the fact is 
they are public companies and they do operate in the light. It seems to 
me that when we argue about big oil--and we do that in a negative way 
sometimes--what we forget is that every year--this year $700 billion--
and again over the next 10 years, under present trends, we will send 
$10 trillion overseas to countries that, in many cases, wish us ill.
  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. CORKER. I thank the Chair for your courtesy, and I now yield the 
floor.
  Mr. CORNYN. I thank the Senator from Tennessee for his good work and 
good words on this important issue. I agree with him that it is a 
serious problem and it calls for serious answers. We need a response by 
the Senate when it comes to energy, when it comes to our dependency on 
imported oil. As T. Boone Pickens has pointed out in his crusade to try 
to help people understand where we are on this, he said we send $700 
billion of American money to foreign countries to pay for the oil we 
import. That is because we are not producing enough here at home, 
because we are not conserving, and we are not far enough down the road 
in terms of coming up with alternative sources of energy.
  What is Congress's role in all this? We have done some things. I 
think we ought to give credit where credit is due. We have passed a 
corporate fuel efficiency standard for automobiles. We have passed tax 
benefits and subsidies for things such as solar power and wind energy. 
We have encouraged the production of biofuels such as ethanol, although 
we are finding sometimes that the unintended consequences of using food 
for fuel creates problems in and of itself. Suffice it to say, this is 
a serious problem and Congress has, in many respects, acted I think 
appropriately to address some parts of the problem. Unfortunately, like 
so much of politics these days, this sometimes degrades into a name-
calling contest. I am going to try my best not to engage in that. But I 
do want to respond to the accusation that was made earlier that somehow 
this is attributable to the current administration's tenure in office.
  As you can see from this chart, the price of gasoline back when 
President Bush was sworn into office in January 2001 was $1.49 a 
gallon. It has grown over time to when the Democrats took control of 
the Congress, in January of 2007, to $2.33 a gallon. Then of course it 
has spiked since that time to now on the order of $4.06 a gallon on 
average, more than $4 a gallon. It has gone from January 2001 to today 
to more than $4 a gallon. While our friends who are in charge of the 
agenda and the floor schedule of the Congress, the Democrats who were 
put in a majority status, have been here, we have seen it spike to the 
figures of today.
  That is not to say it is directly attributable to them, but I would 
say it is unfair to suggest that because President Bush has been in 
office since January 2001, he is the only one responsible. The fact is, 
it is our responsibility too. It is the majority leader's 
responsibility, I submit, to give us an opportunity to come up with 
serious answers to a serious problem and not play the same old broken 
game of politics and ``gotcha'' that turns people off so much when it 
comes to the Congress. It is no secret why the approval rating of the 
Congress is at historic lows. There is no secret to that. It is because 
people look at what is happening here in Washington, DC, and they say: 
They are not listening or they may be listening, but they are playing 
political games rather than trying to solve real problems on a 
bipartisan basis.
  I know there is plenty of fault to go around, but why can't we work 
together to try to solve the most pressing issue for working families 
in America today, and that is the high cost of gasoline and energy? We 
know there is a bill on the floor that deals with one part of the 
problem. This has to do with the so-called speculation. Last month, 
Warren Buffett, one of the richest men in America and perhaps one of 
the richest in the world, the CEO of Berkshire Hathaway, said: It is 
not speculation that is the problem, it is supply and demand.
  T. Boone Pickens, whom I mentioned a moment ago--who is spending $50 
million of his own money--met with Republicans today, met with 
Democrats yesterday, to explain why he is spending so much of his own 
money to elevate the profile of this issue so it will be something 
Congress cannot run away from and neither can the Presidential 
candidates but is something they will have to address and solve. He 
said focusing solely on speculation is a waste of time.
  Why would Congress deal with a bill that only addresses speculation? 
I would say I am not sure. What I am willing to do is certainly 
consider and probably support a bill that would be supported on the 
Democratic side that would provide for greater transparency of the 
commodity futures markets and would provide more resources to make sure 
we have more cops on the beat, so to speak, to police the commodity 
futures trading that goes on and to make sure that is not the problem 
or, if it is part of the problem, as the majority leader said 
yesterday--he stood here on the floor of the Senate and said he thought 
it was 20 percent of the problem in terms of the price of oil. I don't 
know if T. Boone Pickens is right; I don't know if Warren Buffett is 
right; I don't know whether the majority leader is right. Let's say the 
majority leader is right and it is 20 percent of the problem. Why in 
the world would we leave the other 80 percent off the table? Why would 
we settle for a 20-percent solution when we could have a 100-percent 
solution, in trying to address this important domestic issue?
  We have come up with a lot of ideas. We have said we need to explore 
and produce more American oil so we have to buy less from overseas. We 
have been told no, we cannot do that. We have been told no, we can't 
produce more nuclear power to help generate more electricity. No, we 
can't investigate the possibility that we could use the coal we have 
here for new technology that would allow us to use that coal to make 
aviation fuel--as the U.S. Air Force is currently testing, a synthetic 
fuel made with coal-to-liquid technology.
  Again--I don't think this is unfair and I think this is exactly what 
we keep hearing--it seems that the answer from the other side of the 
aisle is: No new energy. They want to investigate. They want to 
litigate. They want to raise taxes. But when it comes to new energy 
sources, they say no.
  The one law that Congress of course cannot repeal or suspend, even 
here in Washington, DC, is the law of supply and demand. We know from 
the experts that there is rising demand in countries such as China and 
India, with more than a billion people each. They are buying cars, they 
are consuming more energy. They have watched us and they have seen that 
America consumes about 25 percent of the oil in the world, even though 
we represent a small fraction of the population. They look at that and 
they say maybe that is the reason for their great prosperity.
  I think there is something to that.
  We are having more and more competition globally for this scarce 
commodity. What is our answer on this side of the aisle? We say we need 
to find more and we need to use less. Find more, use less.
  I heard the Senator from Tennessee bemoan the fact that the majority 
leader has said he will not allow a full debate and amendments to this 
legislation. I think it is absolutely critical that we allow full 
debate and amendments that would be likely to actually solve the 
problem, rather than go through what is a patently political exercise 
so somebody or another can check off the box and say: OK, we have been 
there, done that. Now we can go home on August recess. I believe we 
ought to stay here. Rather than go on recess in August, I believe we 
ought to stay here until we actually come up with a commonsense 
solution to this problem.
  Some have said OK, if we start drilling today in the Outer 
Continental Shelf, it is going to take years for that oil to come on 
line. I wish we had thought better about that 10 years ago, when 
President Clinton vetoed production from the Arctic National Wildlife 
Refuge, which Congress had authorized, which would have produced 1 
million additional barrels of oil 10 years ago. That would be flowing 
today if President Clinton had not vetoed that bill.
  The fact is, oil is a globally traded commodity. That is where we get 
back

[[Page S7121]]

to the speculation question. Actually, the market is a pretty rational 
process. For everybody selling a contract for future delivery of oil, 
there is somebody who is willing to buy it. That is how the market 
works, a willing seller and a willing buyer. If Congress were to do the 
rational thing, the sensible thing, the thing that would actually have 
a positive impact by pushing gas prices downward, we would say we are 
open to producing more American energy, perhaps as many as 3 million 
additional barrels of oil a day here in America, which is 3 million 
barrels less than we have to purchase from abroad. That would give us 
some time.
  It would also send a message to the commodity futures markets that in 
the future there is going to be additional supply that is going to come 
on line. That would help bring down the price of oil because 70 percent 
of the price of gasoline is related to the price of oil. I think that 
would have a dramatic impact on the price of gasoline at the pump and 
would provide the American people some relief at a time when they need 
some financial relief.
  It would give us some time so we could do the research and use good 
old-fashioned American ingenuity to come up with alternatives, things 
such as in 2010, when many of the big automobile companies are going to 
introduce plug-in hybrid automobiles that you can actually plug into 
the wall socket in your home and charge the battery you can use then to 
commute to work or, if you believe what Boone Pickens has suggested, he 
said if Government would mandate that all new Government cars and 
trucks run on natural gas, that would relieve a lot of the pressure on 
gasoline and oil prices and bring down the price of gasoline by 38 
percent.
  Mr. DURBIN. Will the Senator yield for a question?
  Mr. CORNYN. I will be happy to.
  Mr. DURBIN. Senator Cornyn probably heard, as I did, when President 
Bush said America is addicted to oil. I took that to mean that we try 
to find a way to move to alternatives and renewable and sustainable 
energy. I hear the Senator's speech moving in that direction as well.
  Could the Senator tell me why he believes 68 million Federal acres of 
land, which we have now given to the oil and gas companies, which they 
are not using for exploration and production, is an argument for giving 
them more acreage?
  Mr. CORNYN. Madam President, I appreciate the question and the 
opportunity to try to answer that. Let me do the best I can. I think 
there is the illusion here in Washington that every acre of land that 
is available for exploration is going to produce oil. As a matter of 
fact, in Texas--I am not unfamiliar with the term ``dry hole.'' As a 
matter of fact, this is a very complex enterprise, where you do seismic 
testing to try to figure out where oil is likely to be. Sometimes you 
are wrong and it costs millions, even sometimes billions of dollars to 
invest to try to produce that oil.
  What the oil companies try to do is figure out where their chances 
are best so they start there. But the more land--including the 
submerged lands in the Outer Continental Shelf--that is available to 
them that now Congress has put out of bounds, I think the better the 
chances are they will be able to find it.
  As a matter of fact, there are experts--I am not an expert, but I 
read what the experts say--who believe there are vast quantities of oil 
and gas available in the Outer Continental Shelf that are not available 
now on the lands to which they have access.
  Mr. DURBIN. Would the Senator yield for another question?
  Mr. CORNYN. I would be happy to yield.
  Mr. DURBIN. If you were given the opportunity to lease either a 
barrel of rainwater or a lake to go fishing, I assume you would lease 
the lake. And I assume these oil and gas companies, in leasing this 
land, believe it is likely to have oil and gas.
  So I ask you, if they have paid their money to lease Federal lands, 
68 million acres--half of it offshore, half of it onshore--and another 
23 million acres in Alaska, where is this mother load of oil you are so 
certain we are holding back from these oil and gas companies that would 
bring us the oil instantaneously and bring down gas prices?
  Mr. CORNYN. Well, I am delighted to try to answer that question, as 
well, because I think the Senator's question demonstrates--I am not 
complaining; I am not criticizing. You know we are not oil and gas 
experts, but I have had a little bit of exposure. Let me try to answer 
that.
  There is not a big lake of oil under the surface of the land that is 
available to anybody who can punch a hole in the earth and then suck it 
out with a straw. So I do not think the analogy is apt.
  These oil companies in America are owned by shareholders. They are 
not interested in drilling dry holes. They are interested in drilling 
where there is actually going to be some oil that can be produced. The 
more opportunity they have, the more lands available to them, the 
greater, they believe and I believe, they can maximize the likelihood 
that they will actually find oil.
  This is not to help the oil companies, this is to help us quit 
sending 700 billion a year of American dollars to foreign countries for 
oil while we have more of it at home, if you believe the experts, about 
3 million barrels a day.
  Mr. DURBIN. Would the Senator yield for another question?
  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. DURBIN. Madam President, who is in control of time now?
  The PRESIDING OFFICER. The minority has 3.5 minutes remaining.
  The Senator from South Carolina is recognized.
  Mr. GRAHAM. Americans are probably wondering what the Congress is 
doing to solve the Nation's energy problems? Apparently, just asking 
each other questions.
  What I would like to do is do something. I would like to have a 
comprehensive plan that would address the fact that most of you out 
there who are listening to me are hurting. You are having to fill up 
your car's gas tank with $4-plus gas. Food prices are going up, and we 
are fiddling while your budget is burning.
  I cannot explain this; I do not know. But you are figuring this out. 
The Congress is at an all-time low in terms of approval rating. It 
seems to me this is something we could all agree on: how to address our 
energy needs.
  Seventy percent of our oil comes from overseas, most of it from the 
Mideast. If you feel good about that, great. I do not. I think most 
Americans would like to get away from that. There is oil off the 
eastern coast.
  I do not know why you would not want to add more supply. If there are 
leases that the oil companies have now they are not using, they expire 
in 6, 8, or 10 years, and they have to pay to renew them. I would 
imagine if there is oil out there, they would go get it.
  But there is a lot of oil and gas, they tell me, off the east coast. 
But there is a moratorium on us being able to explore for it. Lift the 
moratorium, add it to our supply. Every barrel of oil America can 
extract from American-owned resources is one less barrel we need from 
the Mideast, and it makes us more independent. And, yes, get away from 
using oil. I am all for that. But that is not going to happen anytime 
soon.
  Just by lifting the moratorium at the executive level, oil prices 
have come down about $20.
  Nuclear power--everybody talks about it. The French, 80 percent of 
the French power comes from the nuclear industry. They recycle the 
waste too. They do not put it in the ground. They know what to do with 
the waste. Surely we can be as bold as the French.
  Anyway, there is a lot we could do, but we are choosing to do 
nothing. We are choosing to blame each other.
  There is a bill on the Senate floor that addresses one part of the 
problem, speculation. We should be dealing with speculators, we should 
be adding domestic inventory, we should be doing something about 
nuclear power to make sure we can expand our nuclear footprint. It 
would be good for the environment. It would make us less dependent on 
fossil fuels, and, yes, we should come up with new cars that run on 
batteries.
  We should be doing it all. We should do it together. All boats rise 
if we could work together. This is one time when Democrats and 
Republicans, if we would lay down the partisanship and focus on 
America's interests, would

[[Page S7122]]

look better. But we have a bill that allows us to do one thing, and 
that is ridiculous. We should be doing a bunch of things together.
  Ladies and gentlemen of the Senate, America is watching and they are 
not pleased.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Connecticut is recognized.
  Mr. LIEBERMAN. Madam President, before my friend from South Carolina 
leaves the floor, as usual, but not always, I agree with him. I hope we 
can get to a point where we can deal with both of those issues, 
offshore drilling and the development of more nuclear powerplants.
  I wanted to clarify for the Record, when you said we should be as 
bold as the French, you were speaking only of their use of nuclear 
power?
  Mr. GRAHAM. Yes. I would like to refine my remarks. But I would like 
to add, if I may, the French, with all joking aside, the French have 
figured out how to use nuclear power in a safe manner. And we can learn 
from everyone, including the French.
  I say to my good friend from Connecticut, he has the right attitude 
about his job. I wish we all would adopt it.
  Mr. LIEBERMAN. I thank my friend from South Carolina.
  Madam President, I rise to speak in favor of the Stop Excessive 
Energy Speculation Act.
  I want to commend and thank Senate Majority Leader Reid for 
considering and adopting a series of ideas on this subject, including 
particularly the Commodity Speculation Reform Act, which I was 
privileged to introduce along with Senator Collins of Maine and Senator 
Cantwell of Washington State.
  The commodity markets perform a crucial function in our economy as a 
place where producers and consumers of specific commodities can enter 
into what are called futures contracts that help hedge the risks of 
price fluctuations in their industries to give them this certainty that 
they can buy or sell the product that they are dealing with at some 
time in the future. And that gives them some stability for their 
businesses.
  Those markets have existed for a long time, and they perform a 
critically important function. The real physical commodity market 
traders--the airlines, the refineries, the manufacturing firms, and the 
other users and producers of energy--are the people who actually intend 
to produce or take delivery of those commodities such as oil as part of 
doing their business.
  That is why they go out to the futures markets. Historically, 
participation in those markets, quite naturally, has been dominated by 
those commodity traders. That is why they were created, why the markets 
were created.
  Financial speculators, including pension funds, university 
endowments, and other large institutional investors, however, have in 
recent years poured billions and billions of dollars into commodity 
markets betting on rising prices.

  Let's make it clear, these are bets. There is nothing illegal about 
what they are doing. But as I learned long ago, just because something 
is not illegal does not mean it is not wrong or it does not hurt 
people. And the underlying premise of this legislation is that 
excessive speculation in these commodity markets, futures markets for 
oil, particularly, is unnaturally raising the price of oil, which is to 
say immediately, the outrageous price of gasoline that people are 
paying all across our country today.
  The difference between the physical traders, as we call them, the 
people who actually want the product physically or have it to sell, 
such as the producers of energy or airlines or refineries or 
manufacturers and the speculators, the speculators never intend to buy 
or sell the product.
  They are moving paper around, and they are moving enormous amounts of 
paper around. The numbers speak for themselves. In the past 5 years, 
the amount these so-called institutional investors have put into 
commodity index funds has gone from $13 billion to $317 billion. That 
is with a ``b,'' billion.
  And, of course, the price of commodities in these funds rose nearly 
200 percent over the same period. That is what is shown in this chart: 
1970 is here, 2008 there. You can see the black line shows the prices, 
and it shows the stock price commodity index over here, the amount of 
money put in.
  It goes up and down, but it is basically staying here. Then, yes, 
look at that. The amount invested goes up and the prices go up 
dramatically.
  One way to understand this is I think one of the witnesses before our 
committee said there had been an amazing increase in the demand for 
those futures contracts. So, in part, the price has gone up for that 
reason. But I will come back to that.
  Moreover, the amount of money that pension funds have moved into the 
commodities thus far may be the tip of the iceberg. Estimates suggest 
that less than 1 percent of the $2 trillion--trillion this time with a 
``t''--of private pension fund assets is currently allocated to 
commodities. Imagine if that percentage increases to 5 or 10 percent, 
what an impact that will have.
  Through some mystery and magic that I never fully appreciated and 
certainly do not support, futures contract prices, even though they are 
for oil that will be delivered in the future, somehow get read right 
out at the gas pump pretty much the next day. Add that private pension 
money to increasing commodity investments from State and local 
governments, pension plans, hedge funds, insurance companies, and other 
institutional investors, and the result is clear: rising oil, gas, and 
food prices.
  The stark reality is the speculators today threaten to overwhelm our 
commodity markets and substantially increase food and energy prices for 
years to come.
  In a series of hearings that Senator Collins and I conducted in our 
Homeland Security and Government Affairs Committee, we heard testimony 
from one expert that this kind of excessive speculation in the 
commodity markets may be adding as much as $40 to $60 to the cost of a 
barrel of oil. Of course, that then gets pushed through the system and 
we pay at the pump or this winter in our home heating oil purchases.
  There are some people who say that 40 to 60 number is much too high. 
But I would say most everybody we talked to said that speculation in 
the commodities market is certainly adding something to the retail 
price of fuel. I would say even a single dollar increase due to 
excessive speculation is a dollar too much because of the terrible 
effect it has on individual consumers who are struggling to spread 
their budget and use it for the necessities of life, but also because 
of the overall effect it is having now on the American economy.
  Let me give you this example: One of the worst protected industries 
by the increase in fuel prices is the airline industry. Fuel prices are 
an important part of them doing business. And what we read periodically 
when they file their quarterly reports are the stunning losses that 
they are suffering; laying off people as a result, cutting flights as a 
result from their schedule.
  So here is a number. According to the Air Transport Association, 
every $1 increase in the price of a barrel of crude oil adds $470 
million a year in jet fuel costs, almost half a billion dollars more 
cost to the American airline industry. Of course, those costs are 
passed on to consumers in the form of higher ticket prices and other 
surcharges that are now keeping a lot of passengers on the ground and 
the airline industry reeling.
  If speculators want to invest in energy, they can buy stock directly 
in energy companies and that would bring needed investment into a means 
of production; that would increase supply and eventually contribute to 
lower gasoline prices.
  Unfortunately, the Commodity Futures Trading Commission, known as the 
CFTC, has ignored the urgent task of providing a frontline defense 
against this rampant speculation in the commodity markets. As we 
listened to the witnesses from this commission before our committee, it 
seemed they had not even been prepared to recognize and acknowledge 
that there is such a thing as excessive speculation and that it is 
contributing to rising commodity prices. Instead, the commission has 
delegated much of its regulatory authority to the for-profit commodity 
exchanges themselves. This is a very unusual circumstance. These are 
very professionally run exchanges, but what

[[Page S7123]]

has happened is that the regulator we created--and I will talk about 
that in a minute--in the 1930s has given the authority to the regulated 
exchanges to say how many speculation positions--in other words, how 
many futures contracts--any one investor in the market can hold at any 
one time.
  The Commodity Futures Trading Commission was created in the 1930s 
because some of the physical traders, particularly in food-related 
products--grains, et cetera--felt that speculators were unfairly and 
unnecessarily driving up the price of food. So the Congress created the 
Commodity Futures Trading Commission and gave them the power to 
regulate and prevent manipulation and, we would say, excessive 
speculation. They seemed to say they only have the right to police 
manipulation, which is doing something out and out unethical, as 
opposed to putting billions of dollars into the market, moving paper 
around, and raising the price of commodities for consumers. In 
contradiction with Congress's original legislative intent, therefore, 
the commission seems to view its responsibility as confined to that 
single purpose--preventing market manipulation. On the contrary, the 
record will show that Congress fully intended the commission to 
regulate not only market manipulation but what we are seeing today that 
is hurting consumers all across the country badly, and that is 
excessive speculation.
  I want to talk about what this bill before us does. First, I do want 
to say, in fairness and clarity, I am not saying--I don't think anybody 
supporting this bill is saying--that the only reason why gasoline, for 
instance, has gone over $4 a gallon is speculation on the commodity 
markets. There are other causes. One is clearly rising world demand. 
The other is a sense that there is a limited supply of oil under the 
ground. The third is a problem that we in both Houses of Congress and 
the President have created over a period of time, and I suppose others 
in our economy have contributed to it. That is the weakness of the 
American dollar. What is clear is that one of the reasons why this 
enormous amount of money is pouring into the commodity markets and 
speculative index funds over the last 5 years is that the dollar has 
gotten weaker. People who used to leave their money in the dollar as a 
secure place to be, as a kind of hedge against inflation, feel it is 
not working now. That is why they are going into these commodity index 
funds as a better, kind of a gold standard of the day. Until we do 
something about our national fiscal health and strengthen the dollar 
again, there still will be that incentive for people to put money into 
the index funds. So it is not only speculation in the commodity markets 
but, I am convinced this is one of the contributing causes, perhaps the 
one cause that we in the Federal Government, by wisely regulating, can 
actually do something through that will, in fact, put downward pressure 
on retail gasoline and oil prices.
  Here is what the leadership bill does. It incorporates a bipartisan 
proposal that was developed with Senator Collins and Senator Cantwell 
to create a seamless system of speculative position limits that apply 
to commodity positions held both off and on the regulated exchanges. To 
be brief, there is a whole world now that has been created over the 
years outside of the exchanges, New York, Chicago, where these futures 
are traded, so-called over-the-counter, unregulated, foreign exchanges. 
This bill has the aim of covering all those. Because if you are going 
to regulate speculation, you should regulate it wherever it is 
occurring. We in Congress have the power to adopt a law such as that.
  Speculative position limits, the primary policy tool of the CFTC for 
preventing excessive speculation, authorized back in 1935, were used 
successfully for decades. Now it should be extended to where the action 
is occurring. Speculative position limits would put a cap on the size 
of any one investor's holdings in futures contracts of speculation with 
respect to a specific commodity, wherever those contracts were 
purchased. Current caps only apply to positions on the regulated 
exchanges, and we think that no longer does the job.
  In addition, I am working with other Members on a substitute 
amendment that, similar to this bill, because it covers over-the-
counter markets, I want to go on to cover investments on the foreign 
exchanges, incorporate foreign holdings. The outstanding value of over-
the-counter commodity derivatives is estimated by the Bank of 
International Settlements to be $9 trillion. So no bill that wants to 
deal with the commodity trading business can do so without addressing 
over-the-counter trading. We want to go on to the foreign holdings as 
well so that the system will be complete. It won't have any holes in 
it. One of the witnesses before the committee said the current system 
of regulating sales and futures contracts, speculative contracts, is 
like Swiss cheese, a lot of holes in it. Senator Collins and I want to 
make it like good, strong New England cheddar cheese, no holes.
  The bill includes another concept from the Lieberman-Collins-Cantwell 
bill that establishes a specific criteria that the CFTC must use when 
it sets the speculative position limits. It adopts and expands a rule 
from our bill by requiring the CFTC to consider the overall effect of 
speculative activity and to set the position limits at amounts no 
greater than necessary to ensure liquidity in the markets. We are not 
saying all speculation is bad. Some speculation makes the markets 
liquid. It makes them function. It makes them work for those farmers 
and fuel producers and home heating oil dealers and airlines that want 
to deal in the actual physical product. We think that provision is 
necessary.
  Congress fully intended the regulators use the speculative position 
limits to counteract excessive speculation when it passed the original 
Commodity Exchange Act of 1935. I talked about this briefly, but you 
can see it here. Congress stated its purpose was ``to provide a measure 
of control over those forms of speculative activity which too often 
demoralize the markets to the injury of producers and consumers. . . 
.'' ``[T]he bill''--not this bill but the bill in 1935--``has another 
objective, the restoration of the primary function of the exchanges 
which is to furnish a market for the commodities themselves.''
  That is from a House report of March 18, 1935. A lot of years have 
passed since then, but that states the problem we are dealing with now. 
It is worse now because of the hundreds of billions of dollars of 
speculative activity that is going on now.
  Other provisions in this bill are drawn from legislation introduced 
by several of my colleagues, including a proposal from Senator Levin to 
authorize the CFTC to liquidate over-the-counter positions, if 
necessary, in response to major market disturbance. It also includes 
provisions pushed by Senator Bingaman of New Mexico that would enhance 
the tools available at present to the Federal Government to prevent 
market manipulation.
  What I am saying is that rather than constituting a radical 
disruptive attempt to distort commodity markets, our legislation 
basically returns the regulation of commodity markets to where it was 
intended to be in 1935. It adjusts to the changing reality by embracing 
all the places where these speculation futures contracts are being sold 
and regulates them as the Congress of 1935 intended. I know some 
critics of the bill have said it would encourage investors to foreign 
exchanges. I don't believe so. The bill will actually discourage flight 
from the major American exchanges, because it puts all trading 
platforms under the same regulatory umbrella. It is an even playing 
field now because everybody is going to be covered. Speculators are 
subject to the same position limits as those who are investing from 
here, regardless of whether they invest in New York, London, Dubai, or 
over the counter.
  There is another area of the bill I am working with my colleagues to 
address. I want to touch on it briefly. The bill I have introduced with 
Senators Collins and Cantwell would extend the reforms to both energy 
and agricultural commodity markets. The bill before the Senate now only 
deals with the energy markets. I must say that in many respects the 
case for reforming agricultural markets is even greater than the case 
for energy markets, though the American consumer is feeling the 
increase in food prices less painfully than the increase in gas prices. 
But trust me, anybody who has been to the supermarket lately knows they 
are feeling the pinch from increasing food prices as well.

[[Page S7124]]

  Here is the reason. The agricultural commodity markets are 
historically very small. As investor money flows into index funds--this 
is a kind of package of investments in commodities that the big 
institutional investors put money in--that include agricultural 
components, there is a significant risk that the speculative activity 
will actually overwhelm the agricultural commodity markets to the great 
detriment of farmers and American consumers as well. We put our 
proposed legislation on the Homeland Security Committee's Web site. We 
got wonderful responses from people, one very poignant one from 
actually an agricultural food broker in the Midwest--I believe Iowa--
complaining about the unbelievable impact on farmers of this excessive 
speculation coming into the food commodity markets. As he said, even 
though the farmers I deal with are making more money because food 
prices are going up, they know this is going in a bad direction because 
prices are going up for no good reason. They are going up for 
speculation.
  There are those who will object to the bill because they think that 
government should never interfere in free markets. The father of 
capitalism, Adam Smith, noted in ``The Wealth of Nations,'' the great 
classic text on capitalism, that even in a free market, there needs to 
be some limits. He wrote:

       Those exertions of the natural liberty of a few individuals 
     which may endanger the security of the whole society are and 
     ought to be restrained by the laws of all governments.

  I forgot who said it, but somebody else said, probably a little less 
elegantly, that the world has never seen anything like a free market 
system to create wealth. It is a magnificent means of creating 
wealth. But inherently the free market system has no conscience, and 
there are simply occasions when, to maximize gain, people will be 
downright greedy without regard to the consequences on society as a 
whole.

  We honor wealth creation in America. People are not against wealthy 
people in America. Everybody wants to be wealthy in America. But when 
there are no, essentially, policemen on the economic beat, then people 
who have a lot of money begin to take advantage of people who are on 
the other end.
  That is why we have a whole system of regulation. I daresay it is 
part of the reason failure to regulate adequately, which has been noted 
by people in both parties--Secretary Paulson and others have talked 
about it--failure to regulate financial markets, to adequately create 
accountability in the extension of home mortgages--a banker gives a 
mortgage to somebody who is not able to pay it over the long term, but 
the banker has no accountability because the banker puts it in a 
package, sells it to somebody up the chain, and the next thing you know 
somebody is buying a bond based on those mortgages who lives in Norway, 
as somebody gave me a real-life example.
  That is beginning to happen in a different way in speculation in 
commodity markets, which is why I think we have to extend the original 
law to cover the reality of our day, to protect the American consumer 
and, in fact, to protect the American economy.
  So I know there is what has become a characteristic classic Senate 
moment where there is a potential gridlock over this bill because of 
disagreements on what amendments will be allowed. I surely hope we can 
overcome that because the American people need the relief this bill 
will offer. I hope we can figure out a way to come to a lot of the 
other ideas that colleagues want to put on as amendments because the 
American people need the relief those amendments will offer as well.
  I know people comment on and joke about the fact that in recent 
polling, the people who have a favorable impression of Congress has 
dropped below 10 percent to 9 percent. My friend, the Senator from 
Arizona, Mr. McCain, says when you get down to 9 percent favorability 
for Congress, you are down to family and staff. I want to thank my 
family and my staff, all of you who are here.
  But it is not a laughing matter, and the public is not happy with us 
for good reason. We are not getting anything done to solve their 
problems that they worry about, that they face every day: the cost of 
energy, the cost of health care, the security of their jobs, et cetera, 
et cetera, et cetera, the price of energy.
  This bill is one way to bring some help. So I hope we will figure out 
a way to get beyond the gridlock and get this done.

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