[Congressional Record Volume 154, Number 128 (Wednesday, July 30, 2008)]
[Senate]
[Pages S7759-S7768]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




  NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 2009--MOTION TO 
                                PROCEED

  Mr. REID. Madam President, I made this unanimous consent before and 
it was objected to.
  I move to proceed to Calendar No. 732. S. 3001, the DOD authorization 
bill--that is the Defense Department authorization bill--and I send a 
cloture motion to the desk.


                             cloture motion

  The PRESIDING OFFICER. The cloture motion having been presented under 
rule XXII, the Chair directs the clerk to read the cloture motion.
  The assistant legislative clerk read as follows:

                             Cloture Motion

       We, the undersigned Senators, in accordance with the 
     provisions of rule XXII of the Standing Rules of the Senate, 
     hereby move to bring to a close debate on the motion to 
     proceed to S. 3001, the National Defense Authorization Act 
     for Fiscal Year 2009.
           Carl Levin, Christopher J. Dodd, E. Benjamin Nelson, 
             John F. Kerry, Claire McCaskill, Joseph R. Biden, 
             Jr., Bill Nelson, Blanche L. Lincoln, Richard Durbin, 
             Daniel K. Akaka, Robert Menendez, Kent Conrad, 
             Sherrod Brown, Jack Reed, Jim Webb, Charles E. 
             Schumer, Harry Reid.

  Mr. REID. Madam President, I ask that the mandatory quorum be waived.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. REID. Madam President, I appreciate my friend from Iowa allowing 
me to do this. He has been waiting for some time.
  The PRESIDING OFFICER. The Senator from Iowa is recognized.


                             Tax Extenders

  Mr. GRASSLEY. Madam President, at 2:42 today on the Senate floor, the 
Senate majority leader made an incorrect statement. In discussing the 
negotiations last night between the chairman of the Senate Finance 
Committee and this Senator, the Senate majority leader, who was not 
present at the meeting, stated: ``The only thing that Senator Grassley 
wanted to discuss is having all these extenders not paid for.''

[[Page S7760]]

  I will make a statement of why this statement is wrong. Specifically, 
I made three proposals to Chairman Baucus. In all three of the 
proposals, we agreed to use three tax offsets suggested by Chairman 
Baucus and his staff.
  The first offset I agreed to accept is the offset that closes the 
loophole that allows hedge fund managers to defer compensation in tax 
haven jurisdictions. However, I mentioned we needed to remove the huge 
charitable loophole that is contained in both the Democratic House and 
Senate extenders bill. Closing this charitable loophole will raise 
about $1 billion in extra revenue from hedge fund managers, according 
to the nonpartisan Joint Committee on Taxation.
  Let me make clear why that is a very important adjustment. If you, 
the average taxpayer, want to give the maximum the law allows for a 
charitable deduction, you can only allow 50 percent of your income to 
be used for that purpose. But if you are under this provision, if you 
are a hedge fund manager making contributions to a charity, you can 
have 100 percent deduction. We think that is unfair to the middle-
income taxpayer.
  The second offset I reluctantly agreed to accept was a version of the 
worldwide interest allocation offset. We are still waiting on the 
revenue estimate for this proposal. This was a compromise on my part. 
That is what it will take from the other side, as well, to get an 
extenders bill done--some sort of compromise.
  The third offset I agreed to accept is a permanent offset regarding 
basis reporting of securities brokers.
  These three offsets that I agreed to accept could--depending on the 
revised worldwide interest allocation proposal--raise over $50 billion 
in revenues as offsets.
  As I mentioned above, I made three proposals to chairman Baucus. I 
also offered to use all three offsets mentioned above for each of the 
three separate proposals that I made; therefore, paying for much of the 
revenue loss generated by the tax extender provisions.
  In two out of my last three proposals, I proposed using those three 
offsets to offset much of the revenue loss that results from extending 
these tax extender provisions.
  So for the majority leader to say that ``the only thing that Senator 
Grassley wanted to discuss is having all these extenders not paid for'' 
is simply not accurate. And it is plain wrong. The majority leader was 
not in the room, and he must have received a false report from someone 
who actually was in the room. Chairman Baucus was in the room. So he 
knows the majority leader's statement that the only thing Senator 
Grassley wanted to discuss was having all of these extenders not paid 
for is untrue. I ask everybody to ask Chairman Baucus.

  To demonstrate in detail that the majority leader's statement is 
incorrect, Chairman Baucus and I discussed a number of issues other 
than offsets in the media. One of these issues was my disaster tax 
relief package that is needed for the people of Iowa and the Midwest 
because of the gigantic 500-year floods.
  Three other issues we discussed were the three tax offsets I 
described above. Some other issues that were discussed were provisions 
in the Democratic leadership's extenders bill that we objected to, such 
as the provision regarding the train from Manhattan to JFK Airport that 
accounts for more than 20 percent of the revenue loss in the Democratic 
leader's disaster tax package.
  In addition, I offered to make all three of my proposals revenue 
neutral by suggesting that we use the three offsets mentioned above and 
also decrease the amount of new increases in spending that were 
approved in the budget only 2 months ago.
  Let me be clear, we did not suggest any spending cuts. We suggested 
our colleagues on the other side of the aisle consider decreasing the 
amount of new unspecified nondefense discretionary spending. The 
nondefense discretionary spending that has been authorized in the 
budget is $350 billion greater than the President's fiscal year 2009 
budget. This extra $350 billion is like an extra checkbook that 
Congress is carrying around in addition to the already fat checkbook. 
This checkbook covers nondiscretionary spending and current levels of 
discretionary spending. We simply ask they take a few checks out of the 
extra checkbook over the next 10 years to help pay for part of the 
needed tax relief provisions in the tax extenders package.
  However, this suggestion was summarily dismissed by Chairman Baucus. 
My colleagues on the other side of the aisle are unwilling to even 
consider decreasing their increased--and I emphasize ``their 
increased''--nondefense discretionary spending that is above the 
President's budget.
  In summary, the majority leader's statement at 2:42 this afternoon 
about my position on our negotiations is flat out wrong, and I cannot 
be any clearer than that.
  Folks across the country must wonder why the Senate cannot pass the 
popular expiring tax relief provisions. There is no disagreement 
between the parties on the merits alone. Nearly all Members of this 
body and the other body support the alternative minimum tax fix and 
also the other parts we refer to as extenders; in other words, tax 
provisions that have sunsetted. And, of course, because of the good of 
these provisions, anybody who opposes it would be crazy.
  The problem is the committee and floor process have been disregarded 
by the Senate Democratic leadership. Debate, exchanges of ideas, up-or-
down votes are the essence of how the Senate works. All of that Senate 
process is now bottled up. The Senate process is quite truncated.
  For the first time in this decade--that is, since 2001--the Finance 
Committee members have not been allowed to exercise their rights in the 
committee markup with respect to these issues, with one exception--the 
2002 stimulus bill.
  For the first time in this decade, Senate Members have not had the 
opportunity to debate and amend extenders in a real Senate floor 
process. For the first time in this decade, Senators in the minority 
are being presented with a top-down deal crafted between the Democratic 
leadership of the House and Senate.
  For me, the irony of all of this is very compelling because I found 
myself within the last 2 years, when Republicans were in the majority, 
condemning Republicans for trying to get around letting the Senate work 
its will. Almost 2 years ago today, we faced an attempt to end run the 
natural order of the committee and floor process by the bicameral 
Republican leadership of the House and Senate; meaning when we were in 
the majority. I referred to it at that time as wrongheaded. If it was 
wrongheaded when we had a Republican majority and the Democratic 
majority is doing it, it is just as wrongheaded, as far as I am 
concerned, because 2 years ago it was doomed to fail.
  I don't know how many times I told the Republican leadership: It 
ain't going to work. And right now we are faced with it when we have a 
new majority and that new majority is Democratic. Two years ago, it was 
envisioned as some sort of unicameral, not a bipartisan, bicameral tax-
writing committee process. The unicameral tax-writing committee process 
2 years ago ignored the rights and the privileges of both political 
parties. I used sharp words and directed them at my side's leadership 
of the House and Senate.
  I am sure some on my side thought my comments were over the top. I 
don't care. I didn't care then, at least. Then-Health, Education, Labor 
and Pensions Chairman Enzi stood shoulder to shoulder with me in this 
process. My friends on the Democratic side criticized my leadership for 
the harm it was doing to the rights of the Members of this body that is 
supposed to be the greatest deliberative body in the entire world of 
any parliamentary bodies.
  That is why I find today's actions bitterly ironic. I am sorry to say 
today we find the Democratic leadership attempting to do much the same 
thing. Like the failed trifecta jam then, today's jam will not work.
  Let me make clear, when I refer to the ``trifecta jam then,'' I mean 
2 years ago when Republican leaders thought they could stuff something 
down the throats of Democrats in this body. It failed then, and that 
sort of jam is not working when Democrats are in the leadership 
position.
  It is part of a larger problem with the Senate because we are not 
going

[[Page S7761]]

through the regular order at the committee and floor levels. Issues are 
building up, tempers are flaring, and most importantly, nothing is 
getting done and the people are mad about it. The people back home are 
mad about it.
  I reiterate what I said this morning. The fourth vote failed. That 
failed cloture vote had the effect of Kaopectate. It further 
constipated the Senate. This legislative body needs to function. 
Legislation needs to circulate through this body in the usual form. We 
need real debate and real amendments. We need a legislative laxative.
  Another alternative to resolution is an informal bipartisan process. 
Either way, repeated cloture partisan jams do not lead to an agreement 
that can pass the House, the Senate, and be signed by the President. 
And don't forget about that because that is an important part of the 
process. I think the White House spoke out on some of the AMT and 
extender legislation we have been considering.
  I have my pencil sharpened, a note pad out. I am ready to engage in 
our bipartisan process with my friend Chairman Baucus. I am hopeful the 
Democratic leadership will relieve the constipation on the tax 
extenders legislation. The Finance Committee and Senate need to 
function.
  On behalf of Leader McConnell, I am going to propound a unanimous 
consent request about which I already informed the other side. The 
agreement, if accepted by the majority, would set in motion a process 
that would lead to resolution of these expired provisions. If accepted 
by the majority, we would have real debate, real votes, and a 
resolution that matters.
  Madam President, I ask unanimous consent that upon the conclusion of 
the energy speculation bill, the Senate proceed en bloc to the 
consideration of the Baucus extender bill, S. 3335, and a bill 
introduced by Senator Grassley on the same subject of extenders; 
provided further, that there be 2 hours of debate equally divided in 
the usual form to run concurrently on both measures; and that following 
that time, the bills be read a third time, en bloc, and the Senate 
proceed to vote on passage of S. 3335, followed by a vote on passage of 
the Grassley bill. I further ask unanimous consent that if either bill 
does not receive 60 votes in the affirmative, the bill be returned to 
the calendar.
  Mr. DURBIN. Madam President, reserving the right to object, what the 
Senator from Iowa proposes is that we pay for these tax extenders for 
energy by reducing domestic discretionary spending. To put that in 
layman's terms, for the last 4 years, we have frozen the increases of 
spending at the National Institutes of Health for medical research. 
Senator Grassley would say, let's continue freezing those increases in 
spending for medical research so we don't have to impose taxes on 
American businesses doing business overseas. I disagree with that. It 
is far better that those businesses pay those taxes than we cut back on 
medical research. I object.

  The PRESIDING OFFICER. Objection is heard.
  The Senator from Iowa.
  Mr. GRASSLEY. Madam President, I wish to correct the Senator on a 
couple of respects, and he has exercised the right I expected. First, 
we accept the provisions that were in the Baucus bill for offsets. We 
did suggest a modification on the provision that the Senator said we 
don't want. He is wrong on that point. We will accept it. There is a 
slight modification in it that would give an election. We go along with 
that provision, and I think I made that clear in the remarks I 
proposed.
  The second place the Senator from Illinois is wrong is we are not 
proposing the cutting of spending. We are proposing the $350 billion 
increase that their budget has suggested for additional spending be 
reduced by a very small percentage.
  Mr. DURBIN. Madam President, if the Senator from Iowa will yield.
  Mr. GRASSLEY. Yes.
  Mr. DURBIN. Madam President, so any proposal to increase spending at 
the National Institutes of Health for medical research will be reduced 
by the proposal of the Senator from Iowa?
  Mr. GRASSLEY. If my colleague wants to figure that all the $350 
billion is going to go to the National Institutes of Health, he is 
right. But all $350 billion, obviously, is not going to go to the 
National Institutes of Health.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Vermont.


                             Cost of Energy

  Mr. SANDERS. Madam President, I suspect if people are watching what 
is going on here, they do not have any clue or understanding of what is 
taking place because, in fact, it is fairly incomprehensible. It is 
pretty hard to understand why bill after bill dealing with issues of 
enormous consequence for millions of Americans is being filibustered by 
the Republicans, which means we have to get 60 votes to end the debate, 
votes which we obviously don't have. From the beginning of the session, 
there have been 91 filibusters, which is more than anyone has ever seen 
in the Senate.
  The reason the Republicans are filibustering today is because they 
want to pass the so-called Gas Price Reduction Act. That is the title 
of their bill. But I would argue that the title of this bill is a 
complete misnomer. The so-called Gas Price Reduction Act will not lower 
gas prices today, which stand at about $4 a gallon.
  All over this country, people are deeply upset about having to pay 
these outrageously high gas prices. They are worried about what oil 
prices will be in the winter. They understand the impact of these oil 
prices on food and other aspects of our economy. And the Republican 
legislation is entitled ``The Gas Price Reduction Act,'' but it is not 
going to reduce these gas prices which are so high today. That is not 
my view, that is President Bush's view. That is the view of everybody 
in the world. That is our Republican friends' view. They are saying, 
quite appropriately and correctly, that if you drill now, maybe in 10, 
15, or 20 years, there will be some impact on prices. Well, maybe there 
will be and maybe there won't be, but there is no argument that in the 
midst of a crisis today, what they are proposing will have zero impact 
on our economy right now.

  So whatever the merits or lack of merits--and I am not sympathetic to 
drilling in environmentally sensitive areas in the Outer Continental 
Shelf--what we should be clear about is that the Republican proposal 
will do zero to address the crisis of high energy prices today. And 
again, that is not just my view. President Bush's own Energy Department 
has said that increased drilling offshore would have ``no significant 
impact'' on gas prices until the year 2030, and even then its impact 
would be negligible. That is what President Bush's own Energy 
Department is saying.
  So perhaps our Republican friends might want to change the title of 
their bill from ``The Gas Price Reduction Act'' to the ``No Significant 
Impact on Gas Prices; Maybe By 2030 Act.'' That would at least be a 
more accurate description of what they are trying to do. Maybe there 
will be some impact by the year 2030, but let's not fool the American 
people. The American people are angry, they are frustrated about what 
is going on today. And we could argue whether the Republican policy is 
good or not good, but let's not kid anybody, it is not going to have 
any impact on gas and oil prices now.
  For those who think it is okay not to do anything or see any impact 
until 2030, I guess they could support what the Republicans are doing. 
But I know what is going on in Vermont; that is, workers can't afford 
$4 a gallon for gas when they are driving 50 miles to work and 50 miles 
back, and they surely can't afford the price of oil that is coming down 
the pike next winter. They do not want action in 20 years, they want 
action now. And in my view, Madam President, that is what we should be 
doing.
  With the exception of my Republican friends here in Congress, there 
are very few people in this country who believe the oil companies give 
one hoot about the well-being of the American people. Our Republican 
friends are saying that if we just give these huge oil companies more 
acres offshore to drill for oil, they will certainly do the right 
thing, as they always have, for the American people. Let's just trust 
those big oil companies because they are really staying up day after 
day, night after night, worrying about the well-being of the American 
people. That is what their full-page ads in the New York Times and all 
their ads are telling us.

[[Page S7762]]

Well, it is good to see there are at least some people in America who 
believe that. I don't, but apparently my Republican colleagues do.
  Let me just mention to you, Madam President, just how much concern 
the oil companies have for the American consumer. While the American 
people have been paying $4 and more for a gallon of gas, ExxonMobil has 
made more profits than any operation in the history of the world over 
the past 2 consecutive years, making $40 billion last year alone. Oil 
prices are soaring, and ExxonMobil is making recordbreaking profits. 
But ExxonMobil, of course, is not alone. Chevron, ConocoPhillips, Shell 
and B.P. have also been making out like bandits. In fact, the five 
largest oil companies in this country have made over $600 billion in 
profits since George W. Bush has been President. Yes, they are deeply 
concerned about the high price of gas and oil. Yes, they really are. It 
is really upsetting to them. Last year, the major oil companies in the 
United States made over $155 billion in profits--in just 1 year.
  Let me tell you, Madam President, big oil companies are so concerned 
about Americans paying high prices for gas and oil that this is what 
they are doing with their profits. You see, our Republican friends 
would suggest that what the oil companies are trying to do is explore 
new areas, do new drilling, produce more oil, and lower prices. Well, I 
don't think so, frankly. I will tell you what they are doing with their 
huge profits.
  In 2005, ExxonMobil gave its CEO, Lee Raymond, a $398 million 
retirement package--among the richest compensation packages in 
corporate history. They weren't going out looking for new land to drill 
on, they weren't building more refineries, and they weren't working on 
energy efficiency. They gave their CEO a $398 million retirement 
package.
  In 2006, another one of those oil companies that is staying up nights 
worrying about the American people, Occidental Petroleum, gave its CEO, 
Ray Irani, over $400 million in total compensation--again, beyond 
comprehension to ordinary people.
  In fact, there were articles recently in the press suggesting that 
one of the major problems ExxonMobil had is that they had so much cash 
in hand, they literally did not know how to invest it or how to get rid 
of it. That was their major problem.
  The situation is so absurd and the greed of the oil companies is so 
outrageous that these companies are not only giving their executives 
huge compensation packages in their lifetimes, but they have also 
created a situation, if you can believe it, where these oil companies 
have carved out huge corporate payments to the heirs of senior 
executives if they die in office. I guess this is what happens when you 
have more money than you know what to do with.
  In other words, if, according to the Wall Street Journal, the CEO of 
Occidental Petroleum dies in office, his family will get $115 million. 
The family of the CEO of Nabors Industries, another oil company, would 
receive $288 million. So it is not only giving out huge compensation 
packages; if the CEO dies in office, the family gets a huge package. 
Madam President, this would be funny if it were not so pathetic in the 
sense of the impact this type of spending has on the American people.
  Not only are huge oil companies using their recordbreaking profits on 
big compensation benefits for their CEOs, but they are also spending 
large sums of money buying back their own stock. In other words, when 
they are making these very large profits, they are not going out 
drilling for more oil, as our Republican friends are suggesting. 
Overall, since 2005--3 years ago--the five largest oil companies have 
made $345 billion in profit and spent over $250 billion of that $345 
billion buying back stock and paying larger dividends to their 
stockholders. That is what they are doing with their money. They are 
not going out and saying: Gee, how can we do more drilling? Gee, how 
can we lower the price of oil? They are buying up stock and increasing 
the benefits to their shareholders.
  Last year, ExxonMobil, the largest oil company in our country, spent 
850 percent more buying back its own stock than it did on capital 
expenditures in the United States. And that is a fact.
  Let's not kid ourselves. The big oil companies--and I know we are not 
supposed to talk about this too much in the Senate, but anyone who 
doesn't believe these oil companies have huge political influence over 
what goes on here in Washington is surely kidding themselves. Since 
1998, the oil and gas industry has spent over $616 million on lobbying. 
In a 10-year period, they have spent over $616 million in lobbying. 
Now, what does that mean? It means they hire the best law firms in 
town, they hire former leading Republicans and Democrats--anybody can 
come in and work with Members of Congress--to get their way. That is 
one of the reasons why, among many other reasons, this Congress, in 
recent years, has decided to give some $18 billion in tax breaks to oil 
companies despite their recordbreaking profits. Over $616 million in 
the last 10 years on lobbying, and since 1990 they have made over $213 
million in campaign contributions. And that is a simple fact.
  Lo and behold, what we are hearing today--just coincidentally, no 
doubt--is that the most important thing we can do in terms of the 
energy crisis is to provide more land offshore for the oil companies to 
drill at a time when they already have some 68 million acres of leased 
land, which they are not drilling on today.
  The American people want action, and there are some things we can 
do--not in 15 or 20 years but that we can do right now. Not only do we 
need to impose, in my view, a windfall profits tax on these extremely 
powerful oil corporations, but we have to address what I perceive is a 
growing understanding that Wall Street investment banks, such as 
Goldman Sachs, Morgan Stanley, JPMorgan Chase, and hedge fund managers 
are driving up the price of oil in the unregulated energy futures 
market. In other words, they are speculating on energy futures and 
driving up prices.

  There are estimates that 25 to 50 percent of the cost of a barrel of 
oil is attributable to unregulated speculation on oil futures. I know 
the Presiding Officer's committee has had hearings on this issue and 
other committees have had hearings on this issue. We have heard from 
some leading energy economists, and we have heard from people in the 
oil industry themselves who tell us that 25 to 50 percent of the cost 
of a barrel of oil today is not due to supply and demand or the cost of 
production but is due to manipulation of markets and excessive 
speculation. In essence, Wall Street firms are making billions as they 
artificially drive up oil prices by buying, holding, and selling huge 
amounts of oil on dark unregulated markets.
  Some of my Republican friends claim that the increase in the price of 
oil has nothing to do with speculation, but it is interesting to me 
that we have had executives of major oil companies--major oil 
companies--who have come before Congress and who are saying, ``Why is 
oil $125, $130, and $140 a barrel?'' Do you know what they say? The CEO 
of Royal Dutch Shell testified before Congress and said:

       The oil fundamentals are no problem. They are the same as 
     they were when oil was selling for $60 a barrel.

  This is not some radical economist. It is not some leftwinger. This 
is a guy who is the head of Royal Dutch Shell.
  The CEO of Marathon Oil recently said:

       $100 oil isn't justified by the physical demand in the 
     market.

  I know my Republican friends have a lot of respect for the oil 
industry, a great competence in them. They love them and give them huge 
tax breaks. So maybe they should listen to what some of these guys are 
saying in terms of oil speculation.
  Some people have suggested or implied that those of us--including 
people in the oil industry--who believe speculation is driving up 
prices are into some kind of conspiracy theory, that we just want to 
demonize Wall Street or big investment banks such as Goldman Sachs and 
Morgan Stanley. Well, I would like to briefly read an excerpt from a 
research paper done by Goldman Sachs US Economic Research dated June 2, 
2008. This is what they say, and I find this interesting:

       Lawmakers and regulators have begun to respond to these 
     concerns--

  Concerns about high oil prices--


[[Page S7763]]


     but we still think it is unlikely that there will be any 
     significant legislative changes enacted this year. In fact, 
     it is entirely possible that Congress will adjourn for the 
     year without enacting any further legislation focused on 
     commodity speculation.

  And then this is the interesting thing they say:

       However, the debate itself could break the rise in energy 
     prices for a brief period until there is greater certainty 
     regarding the legislative and regulatory outcome.

  In other words, what Goldman Sachs is saying is that even the debate 
on speculation in the oil industry could have an impact on slowing down 
oil prices, and it may well be that is the case. We have seen that in 
the last 2 weeks or so.
  Let's talk a little bit about recent history and speculation and 
market manipulation in terms of the energy market.
  In 2000 and 2001, our friends at Enron successfully manipulated the 
electricity market, and the results, of course, were that in California 
and on the west coast electric rates went up by 300 percent. It is 
interesting to remember--and I remember this--what Enron was saying at 
that time. They were saying don't blame us, it is a supply and demand 
issue.

  I gather those Enron officials, who may be in jail today, are perhaps 
still saying that, but we know a little bit differently.
  We also know that BP artificially increased prices on the propane gas 
market. They were fined for that over $300 million. We also know 
Amaranth, a hedge fund, manipulated prices on the natural gas market. 
In fact, in 2006, Amaranth cornered the natural gas market by 
controlling 75 percent of all the natural gas futures contracts in a 
single month.
  In other words, the idea of manipulation and speculation and control 
of a market is not a new idea. We have seen three instances in the last 
8 years, with Enron, BP, and Amaranth doing just that.
  Given that reality, why would we think it is so shocking that is 
taking place right now in terms of oil?
  Let me conclude by saying it is imperative that we move now in terms 
of addressing the energy crisis. People all over this country are 
hurting. They want us to act, and we must act. To my mind, one of the 
things we have to do is to move this country aggressively forward in 
terms of energy efficiency and in terms of sustainable energy.
  Our Republican friends talk about wanting to grow more energy, 
increase energy supplies. Let me inform them the Sun does that, the 
wind does that, geothermal does that, biomass does that. It is 
incomprehensible to me that time after time legislation has come before 
this body--including today--which will simply extend the tax credits 
that have been given for sustainable energy, and we cannot even do 
that.
  There are huge economic gains, not to mention moving forward in terms 
of global warming and reducing greenhouse gas emissions if we do that. 
Yet we cannot even get the votes to do that.
  We can move forward in terms of a windfall profits tax. We can move 
forward in speculation. We can move forward in terms of energy 
efficiency. We can move forward in terms of encouraging the growth of 
sustainable energy. Those are the things that we can do now. I believe 
those are the things the American people want us to do.
  I yield the floor.
  The PRESIDING OFFICER (Mr. Casey). The Senator from Idaho is 
recognized.
  Mr. CRAPO. Mr. President, I would like to speak tonight on the issue 
of energy as well. We are very fortunate that the Senate is debating 
the issue of energy. It is the No. 1 issue to the people of this 
country. Frankly, I find myself very concerned about where this debate 
is going.
  In early July, I asked my fellow Idahoans to contact me and tell me 
what the high prices of fuel mean in their lives. In fact, I asked them 
not only to tell me what it meant in their lives but what they thought 
we ought to do in this country--Congress as well as the rest of the 
country--what we ought to do about these high prices of fuel.
  The stories that came in were remarkable. Overnight I had 400 to 600 
e-mails, and we now have over 1,200 e-mails in our office from citizens 
of the State of Idaho who are feeling the impact of these high prices. 
It is not just a minor inconvenience in their lives. The stories they 
tell are poignant. They are disturbing.
  One lady wrote in that at the end of the month she and her husband 
just had enough money left in their budget to either fill their gas 
tank or to buy their food. They made a choice to fill their gas tank 
because they had to have the fuel to get to work and keep their jobs. 
In her response she said she didn't know exactly how they were going to 
deal with the issue of food.
  Others talked about the fact that they were not able to pay for 
needed medicines. The pressure of fuel versus food versus medicine gets 
down to the basics in our society. This is not a question of whether to 
call off a long-planned vacation. It is not a question of whether we 
have to adjust to some minor inconveniences. We have already done that 
in our society. This is an issue of changing the quality of life in 
America that will probably not be able to be fixed or reclaimed if we 
do not respond to it properly now.
  As I said, I also asked my constituents to tell me what they thought 
we ought to do. The responses were remarkable. I think the people of 
Idaho have a tremendous amount of common sense. I brag on them all the 
time. They have come through with all kinds of suggestions about how we 
ought to deal with this problem, everything from the need to conserve 
more, to the need to use wind and solar and other renewable and 
alternative fuels, to the need to get more production of oil. They get 
it. They understand the solution to this problem is not just one thing.
  Another remarkable thing came across in their responses to me. They 
are angry. They are angry that Congress is not dealing with the issue 
because they blame Congress that we are in this problem. I said before, 
sometimes it is kind of a national pastime to blame Congress for 
whatever the problem of the day is, but in this case my constituents in 
Idaho and the rest of the public in this country are right. It is the 
responsibility of Congress to have established a rational, 
comprehensive, national energy policy for this country that can help us 
to be independent and strong in terms of our energy. Congress has 
failed to do so.
  America now needs to move forward. America is too dependent on 
petroleum as our major source of energy. For that petroleum, we are too 
dependent on foreign sources. America needs to treat our energy policy 
like we would treat an investment portfolio. We need to diversify. We 
need to be as conservative and as careful in the utilization of our 
energy as possible. We need to be as efficient as we possibly can in 
terms of the utilization of that energy. And we need to have broad and 
diverse resources of energy.
  At the same time that we are doing that and diversifying--and I hope 
we could diversify, we here in this Congress, help to establish a broad 
diversified energy policy--while we are doing that we can't simply say 
that petroleum is evil and we will no longer ever try to utilize 
production of oil in this country. It will take us a significant amount 
of time to transition to an economy that is less dependent and less 
held hostage to petroleum. While we are doing that, frankly, we need to 
recognize that we need more production of oil in the United States.
  So where are we today in the Senate? We have before us a bill that 
does one thing: it addresses the futures market, the speculation that 
the Senator from Vermont, who spoke before me, just talked about. It 
does nothing else. It seeks to find a solution to our national energy 
problems in one way; that is, to establish a very aggressive new 
regulatory regime for the futures market in our country. It does not do 
so in a very good way. I will talk about that in a few minutes. In 
fact, it does so in a way that will actually harm our economy and harm 
our energy security.
  The point is, it does only one thing. As it seeks to solve the 
problem, it tells the American people that we have a rifleshot 
solution, that we can simply pass this law and we will then fix the 
problems with energy prices because we will force those markets to have 
better prices. The solution? A new Government system of regulation that 
will, hopefully, control prices. Like I say, it is not going to do 
that, and I will talk about that in a minute.

[[Page S7764]]

  We are trying to debate this issue and bring other issues forward, 
and we have been stopped so far. The process in the Senate is not 
working. Historically, the Senate has been a place of great debate 
where those with ideas about how to solve pressing problems in our 
country can bring them forward and those who have different and 
competing ideas can bring their ideas forward as amendments. And, as we 
move forward, we would have votes on the floor of the Senate where the 
majority could prevail and we could craft legislation and craft policy 
for this Nation in the way that those who established this great 
country--and those who live in this great country--thought it should be 
done.
  But that is not how it is being done on this bill. We are being 
presented with a bill that we have now been on for, I think, 8 days. 
Yet we have had zero votes on any alternative ideas because the 
majority will not allow amendments to be brought forward in a fair and 
reasonable way.
  This chart shows what was done in previous debates in the Senate on 
the energy issue. When the Energy Policy Act of 2005 was considered, we 
spent 10 days on the Senate floor. We had 19 rollcall votes on 
amendments, 23 total rollcall votes on the bill, there were 235 
amendments that were proposed to that bill, and 57 of those amendments 
were agreed to either by vote or by unanimous consent. At that time the 
average price of gas was just $2.26.
  In 2007 when we debated the Energy Independence and Security Act, we 
spent 15 days on the Senate floor, 16 rollcall votes on amendments, and 
22 rollcall votes on the bill. There were 331 total amendments proposed 
during debate on that bill, 49 total amendments agreed to in that 
debate, and the Senate acted its will.
  Again, what are we doing today? For 8 days we have been trying to 
bring amendments forward to present some alternative ideas, additional 
ideas about how we should deal with energy policy in our country, and 
we are told no. We are told: We may allow you to have a few votes on a 
few selected amendments that we pick, but we will not allow a full, 
robust debate on amendments.
  We must get beyond the parameters of this bill. It has been argued 
that the speculation in the futures market is controlling or is driving 
up the price of fuel. The fact is, that is simply not the case. The 
problem is one of supply and demand.
  This chart shows what has happened to the supply of energy, of global 
crude from 2000 to 2008. You can see, starting in about 2004, primarily 
through decisions in the OPEC nations, the supply of crude oil has 
leveled out. Because of a decision to curtail supply, those nations 
that are engaging in producing the global crude are able to impact the 
supply and demand curves. Yet demand at that same time has not leveled 
out. China and India in particular are increasing their demand for fuel 
dramatically.
  The problem we face is, as the supply curve levels out and as the 
demand continues to grow, we see unbelievable pressures on the price of 
fuel. There are those who will say that is not really the way it is and 
really speculators in the market are driving up the price. It is 
possible to impact a market in a way that is abusive, and we have 
organizations that help us on that. But let's look what has happened so 
far in the speculation, the futures market, trading in NYMEX in the 
United States.
  In the speculation in the derivative markets, in the futures market, 
every buy must be mirrored by a sell. The theory there has been this 
immense new pressure for speculation in the futures market creates the 
impression that there have been all of these purchases that have driven 
up the price. But as you see from this chart, every time there was 
someone who thought the price was going to go up, there was someone who 
had to believe the price was not, who had to be the buyer or seller in 
that transaction.
  When you have the long sells and the short sells virtually mirroring 
each other, it indicates there is a reasonably effective functioning 
market.
  It has been said on the floor of the Senate that the experts say that 
speculation is driving up the price of fuel by 20 to 50 percent.
  The reality is the vast majority of experts are saying that simply is 
not the case; that we can evaluate what is happening in the futures 
markets and determine whether there is being manipulation.
  And what is the determination that is being made? A recent report by 
our Government agencies, including the Commodity Futures Trading 
Commission, the Federal Reserve, the Treasury Department, and Energy 
Department, found that speculative trades in oil contracts had little 
to no effect on the rising prices over the last 5 years.
  The Interagency Task Force on Commodity Markets' preliminary 
assessment is that current oil prices and the increase in oil prices 
between January 2003 and June 2008 are largely due to fundamental 
supply and demand factors.
  During the same time period, activity on the crude oils futures 
market, as measured by the number of contracts outstanding, the trading 
activity and the number of traders, has increased significantly. The 
amount of trading in these markets has increased significantly. But 
while these increases broadly coincided with the runup in crude prices, 
the task force's analysis is that to this date there is no support for 
the proposition that speculative activity has systematically driven 
changes in those oil prices.
  In fact, according to the report, if a group of market participants 
had systematically driven up prices, detailed daily position data 
should show the group's position changes preceded the price changes. 
But the task force data indicates the changes in futures markets 
participation by speculators have not preceded the price changes. In 
fact, on the contrary, most speculation traders typically alter their 
position following a price change, suggesting that they are responding 
to the supply and demand dynamics, just as one would see in an 
efficiently operating market.
  Furthermore, the President's Working Group on Financial Markets has 
also weighed in on this debate. They state:

       To date, the PWG has not found valid evidence to suggest 
     that high crude oil prices over the long term are a direct 
     result of speculation or systematic market manipulation by 
     traders. Rather, the prices appear to be reflecting tight 
     global supplies and the growing world demand for oil, 
     particularly in emerging economies. As a result, Congress 
     should proceed cautiously before drastically changing the 
     regulation of energy markets.

  Other experts are saying the same thing. In fact, the amount of 
experts who are weighing in on this today from all perspectives is 
overwhelming, to the point that there are very few now who are 
continuing this mantra that somehow we can solve all of our problems by 
controlling the futures markets better.
  The International Energy Agency states:

       There is little evidence that large investment flows into 
     the futures markets are causing an imbalance between supply 
     and demand.

  They go on to state, and this is something I think Americans need to 
hear:

       Blaming speculation is an easy solution which avoids taking 
     the necessary steps to improve supply-side access and 
     investment or to implement measures to improve energy 
     efficiency.

  Others are respected in market analysis. Warren Buffett recently 
said:

       It is not speculation, it is supply and demand. We do not 
     have an excess capacity of oil in the world any more, and 
     that is what you are seeing in oil prices.

  Frankly, one of the more critical aspects of this is that investors 
in these markets actually provide liquidity to our oil industry. 
Investors play a very valuable role in the futures market by 
transferring risks from commercial participants such as farmers and 
airlines, and providing liquidity, reducing volatility, and 
contributing to the price discovery process.
  One example is Southwest Airlines. Southwest Airlines provides a 
powerful example of how investors can help companies mitigate their 
risk. It is called hedging, which is made possible by the participation 
of investors in trading oil futures. That has saved Southwest Airlines 
$3.5 billion since 1999.

[[Page S7765]]

  How does this work? Let's take an example of an oil producer, 
somebody who wants to go out and invest some money in a new oil rig or 
a new refinery, to engage in some production of some further resources, 
energy resources for the United States, and they want to get a loan for 
$5 billion. There is probably no source in the world that would loan 
them $5 billion to go out and engage in this new investment unless they 
were able to hedge that loan, meaning they need to go into the futures 
market and sell the first 3 to 5 years of production of this facility 
so they can show the bank or the financing institution that is going to 
loan them the money that they have a source of capital or cash to repay 
the loan.
  If they are not able to go into a market and make that hedge, they 
will not be able to get that loan. They will then not make the 
investment and we will not then see the production. And if there are 
not those who are willing to invest in that futures market, on the 
other side of the transaction, those who are called speculators, then 
we do not have the liquidity in the market for that loan to be 
adequately hedged.
  It is very important for the risk management in our economy that we 
do not impact our futures markets in ways that will disturb the proper 
functioning of a true market.
  Congress has enacted various tax incentives for renewable energy 
which also can be impacted negatively by harmful regulation of the 
futures market. In the same way as the example I gave with regard to 
those who might want to invest in an oil facility, if there cannot be 
adequate hedging of investments in wind and solar and other facilities 
such as that for which we have enacted tax incentives to try to move 
into renewable energy, then those investments as well without a futures 
market will not be able to flourish as they should.
  These kind of impacts, these kind of dynamics that could occur in our 
economy from improper regulation of the market are real. Again, some 
say: Well, you know, the oil companies or someone has been out there, 
speculators have been manipulating the futures market.
  Commodity prices have shot up not just in oil but across the board. 
This chart shows a number of commodities, from wheat to corn, to steel, 
to iron ore, nickel, zinc, copper, platinum, all the way along, 
including oil. This is the line for the WTI oil, that is the futures 
market in oil right here.
  As you will see, there are many commodities that have risen in price 
over the past few years, from 2006 to 2008, even more so than oil. The 
point there is, some of these commodities are regulated or traded on 
futures markets and some are not. The same dynamics of supply and 
demand are hitting us in other commodities as they are in oil.
  According to Robert Samuelson, an economist and Washington Post 
columnist, the price of corn has increased 70 percent from 2002 to 
2007; copper has increased 300 percent during the same time; steel, 117 
percent. And interestingly, steel is one of those that is not traded in 
the commodities market. Neither is iron ore, the cost of which has 
recently increased by 85 percent in Chinese markets.
  The point here is that supply and demand, not investors, is what is 
driving up the prices in commodities. How else can you explain the fact 
that raw materials that are not traded on commodity exchanges are 
increasing at the same rapid pace?
  Let's look specifically at the crude oil issue in the next chart. 
Those who say it is the futures market which is driving up the price of 
oil would tell you this market right here, the one in red, for West 
Texas Intermediate, where the futures in oil are traded, is where some 
not normal increases are being forced, where market speculation is 
manipulating the price.
  Yet if we look at other physical crude oil grades, the West Texas 
Sour, Light Louisiana Sweet, the Mars, the Dated Brent, and the Dubai, 
they have all gone up actually higher than the West Texas Intermediate.
  Now, I know this is getting down into the weeds a little bit, but the 
point here is, every one of those other types of oil is a physical 
crude oil that is not traded in futures markets. There are no 
speculators driving up these prices or causing these prices to occur. 
These prices are occurring at the spot where those who produce the oil 
are selling it to those who use the oil.

  One more indication that in market after market after market, not 
just the futures market, but in every market, the price of oil is going 
up. And again the reason is because supply and demand is out of 
balance.
  Let me give you another example. Onions. In 1958 Congress had a 
similar issue to the one we have today. They responded to a sharp 
increase in onion prices by passing legislation to ban all futures 
trading in onions. And that law, by the way, is still law today.
  But there has been no stabilizing effect on the price of onions. In 
fact, the price of onions soared 400 percent in late 2006 and 2007, 
only to drop by 96 percent thereafter, and then increase another 300 
percent a month later.
  The point is that wide volatile swings in price occur in an 
unregulated market or in a market where there is not a futures system 
where speculators can invest and provide more stability. The onion 
market is a perfect example. Many of the experts who are now weighing 
in on the oil issue are stating that if we take the opportunity for 
speculation in the futures markets out of the equation, then we can 
expect to see wider fluctuations in the price of oil.
  Now, is that to say there is nothing we should do in the Senate with 
regard to futures markets or that there can never be any manipulation 
or there is no reason to pay attention to this issue? No. It is 
possible. It is not easy, but it is possible for very concerted efforts 
to be undertaken to manipulate markets.
  That is why we have groups such as the Commodity Futures Trading 
Commission that are basically our cops on the beat to make sure they 
pay attention to what is happening in these markets and stop efforts to 
manipulate before they occur.
  So what should we do? What should we be doing in the context of this 
piece of the equation with regard to our securities, our futures 
markets? We need to be strengthening the CFTC. The CFTC has not had a 
significant staffing increase level since--well, let's put it this way. 
Their staffing levels at the CFTC are at a 33-year low.
  In one of the amendments we wish to bring forward, we would provide 
the resources for the CFTC to hire 100 new employees, enough staff so 
they can even more aggressively and effectively monitor what is 
happening in these markets, and make sure there is no effort to cause a 
manipulation in any significant way.
  In addition, before this Senate, as we speak, we have nominations for 
three members of the Commodities Futures Trading Commission who still 
languish on our docket: Walt Lukken, Bart Chilton, and Scott O'Malia. 
They should have been confirmed by this Senate to the CFTC months and 
months ago, but they languish because of partisan politics. They need 
to be moved forward promptly. If we are serious about wanting to 
oversee these futures markets effectively, then we need to put those in 
place who are tasked to do so, and to make sure they have the staff to 
be able to do so effectively.
  The CFTC has undertaken a number of steps recently to improve the 
oversight and transparency of energy futures markets, and we need to 
give them the resources to get the job done well.
  The underlying legislation is based on the premise that we can simply 
reach our hand in, as the heavy hand of Government and change the price 
of oil. The reality is the opposite.
  I said earlier we need a broad-based approach. Yes, let us strengthen 
the CFTC, but let's open the floor of this Senate, and let's allow the 
Senate to debate other ideas. What are some of the other ideas we need 
to be pursuing?
  For one, we need an aggressive perspective on energy efficiency and 
conservation. With energy and gas prices spiraling upward, America can 
no longer consume energy as we have in the past. In fact, energy 
efficiency is often called the fifth fuel because every gallon of gas 
not consumed and every kilowatt hour not utilized is the equivalent of 
one produced. The numbers are stark. If you look at the amount we have 
saved since 1973 through efficiency and energy conservation efforts, it 
is the greatest source of energy we have. It outstrips petroleum, coal, 
natural gas, nuclear power, and all others.

[[Page S7766]]

We still have tremendous potential for strides forward. The estimates 
we have before us are that the United States can cost-effectively 
reduce energy consumption by an additional 25 to 30 percent or more 
over the course of the next 20 to 25 years. That is a significant fact. 
That should be a significant part of our national energy policy. The 
kinds of things we need to do there are the kinds of things we need to 
be debating and voting on and incentivizing in the Senate.
  The Alliance to Save Energy estimates that if the proper energy 
efficiency measures across the industrial, residential generation and 
transportation sectors were put into place, we could save $312 billion 
a year. The savings in the residential sector alone total $145 billion 
a year or $500 for every citizen over a 10-year period. An example: The 
new fluorescent light bulbs use one-fifth the electricity of a 
conventional light bulb and can save $50 apiece over the lifespan of 
just one light bulb. Other ways include greater appliance efficiency 
standards, smart grid technologies, as well as weatherization. Research 
and technology are key to this. In fact, one of the things we can do in 
our transportation sector to reduce our reliance on petroleum is to 
move to low-energy vehicles. Battery research is well underway, and we 
could move to plug-in hybrids or hydrogen fuel cell vehicles relatively 
soon, if this Congress would get engaged and incentivize and strengthen 
our commitment to that technology effort.
  We already have implemented new CAFE standards, which was a proper 
and positive step forward. My point is this: One of the first things we 
need to do in our rational comprehensive energy policy is to engage in 
conservation and efficiencies. It is our fifth source of fuel and one 
of our most significant potential sources.
  We also need to move into renewable and alternative energy sources. 
We have listed a sampling of them here: Hydropower, nuclear, biomass, 
solar, wind, geothermal, and tidal. Some of them are not at the stage 
where they can economically survive without support or incentives. 
Frankly, as a government, we need to be working in every one of those 
areas to do the research, the technology, and to provide incentive 
support for us to move aggressively into those areas.
  Let me give a couple examples of what we could do. Nuclear power is 
the only reliable base load generation that emits no carbon or other 
air pollutants. To supply our growing electrical generation needs, the 
EIA estimates at least 60 new nuclear plants are needed in the next 25 
years to supplant new fossil-fuel generation. But no new plant has been 
built in the last 30 years. The main reason for this is the facilities 
are expensive to site and to build. They require enormous amounts of 
capital for design and construction before any profits can be realized, 
and our current regulatory process challenges this whole system and 
extends just the permitting process so long that it makes it hard 
financially to make it pan out. Congress could fix that. We need to be 
as aggressive as we possibly can to incentivize, strengthen, and expand 
our nuclear energy industry.
  Geothermal: An MIT study concluded it would be affordable to generate 
over 100 gigawatts of geothermal electricity by 2050 in the United 
States alone for an investment of $1 billion in research and 
development over 15 years. To give perspective, that would replace 100 
coal plants.
  Wind: Idaho is ranked 13th in the Nation for wind energy, and global 
wind power currently stands at 94 gigawatts per year. China has a plan 
to equal that itself by the year 2020.
  Biofuels and ethanol: I support this diverse energy portfolio, and 
biomass and biofuels, conventional and cellulosic ethanol, as well as 
biodiesel, are one part of the solution. As concerns about the rising 
price of corn mount, the need for commercial cellulosic ethanol 
production becomes more apparent. It is estimated that 1.3 billion dry 
tons of biomass can be harvested annually from U.S. forests and 
agricultural land without negatively impacting food, feed or export 
demands. What that translates into is enough ethanol to replace 30 
percent of the current U.S. petroleum consumption.
  Hydropower produces 7 percent of the U.S. electricity supply and 
almost 70 percent in my part of the world. It also accounts for 80 
percent of the Nation's total renewable electricity generation, making 
it the Nation's leading renewable energy source. Hydropower turbines 
are capable of converting 90 percent of the available energy into 
electricity, which makes them more efficient than any other form of 
generation.
  The point is the United States can make great gains to, No. 1, become 
less dependent on petroleum and, No. 2, to generate much more energy 
supply, if we will get aggressive about focusing on renewable and 
alternative energy sources. I have gone through a few in this sampling.
  Having said all that, that we can do what we need to, to effectively 
monitor and control and manage our futures markets, that we need to 
focus on renewable and alternative energy sources, that we need to have 
an aggressive efficiency and conservation effort, does that mean we can 
simply ignore the price of oil? The answer is no. Let's go to the next 
chart. Even if we were to agree today and the President were to sign 
into law all these new incentives and the many things we could be doing 
in terms of conservation, renewable and alternative fuels and the like, 
it still would take several decades to transition away from being a 
purely almost totally petroleum-based economy. During that transition 
time, we still need oil. Oil is going to be key to our energy future 
now and for years in the future. While we transition away, we have to 
recognize that. But today, based on Energy Information Administration 
estimates, the United States is expected to spend $570 billion on 
imported foreign oil in 2008.
  If you have been watching the T. Boone Pickens ads and the 
information that comes on those, the estimates are even higher, as high 
as $700 billion. That is $500 to $700 billion that flows right out of 
the U.S. economy to other nations. What does a transfer of that kind of 
wealth mean? Every year that we send $500 to $700 billion outside the 
United States for other countries to produce oil and sell it to us, we 
erode our national security through loss of physical control over our 
own resources. We certainly lose jobs. Imagine the number of jobs we 
could have in the United States if we were engaged in production of our 
own oil. We increase foreign holdings of U.S. dollars that are out of 
our control. We have increased foreign holdings of American debt. We 
have a loss of domestic investment in huge amounts. Overall, we have a 
weakened U.S. dollar. We are sending our wealth overseas because we are 
too dependent on foreign sources of petroleum.

  Do we have the opportunity to change that? Can we do any different? 
Or are we in a situation where the United States does not have access 
to oil resources? The world is using more oil, but U.S. production has 
fallen to its lowest levels in 60 years. The IEA projects that global 
oil consumption is going to grow by 37 percent in 2030; whereas, annual 
oil production will need to be 13.5 billion barrels higher today to 
meet that increase in demand. What kind of potential do we have in the 
United States? Let's go to the next chart.
  There are a number of things we can do. The United States must be 
recognized as one of the strongest and most energy-rich nations, when 
you think about oil in the world. There has been a lot of debate about 
the Outer Continental Shelf. The projected OCS resources would equal 
almost 50 years of imports from OPEC. Think about that. Let's go to the 
next chart. Our OCS is estimated to have over 100 billion barrels of 
oil. We yearly import a little over 2 billion from OPEC nations. Simply 
turning to the Outer Continental Shelf instead of sending all the money 
we now send to OPEC nations, we could generate that oil ourselves 
simply on the OCS in the United States.
  We have Western shale oil resources. These are phenomenal. Proven 
American oil shale resources could provide our country with 800 billion 
barrels of oil, which is more than three times the reserves of Saudi 
Arabia. This chart shows some very interesting information. Over here 
is the world's proven oil reserves. I think that is 1.7 trillion 
barrels of oil. This is the Saudi Arabia proven portion of that. This 
is the U.S. proven oil shale reserve. Remember oil shale is not 
considered to be the same

[[Page S7767]]

as oil. So if we were to take the oil shale and then produce it into 
oil, what could we start doing in comparison to the oil available in 
the world? This is what we know we have: U.S. proven oil shale 
reserves, 800 billion barrels. But there are estimates that the 800 
billion barrels is low and that we actually have up to 2 trillion 
barrels of oil available in our oil shale reserves. Yet we send dollars 
overseas to get our oil.
  So we have the OCS and the oil shale reserves. We have the Arctic 
National Wildlife Refuge, and we have debated this in the Senate and 
House for years. But projected resources in ANWR would equal over 17 
years of our imports from OPEC. Again, another major source of oil that 
the United States can access.
  The reason I am going through this is to show that the United States 
does not have to be dependent on foreign nations for our oil. We have 
other resources. The U.S. onshore resources--and that is not the Outer 
Continental Shelf but what we have right here onshore--are shown here 
at basically 35.5 billion barrels of oil. The yellow part NWR; the red 
is all the rest. Again, the comparison there is to OPEC. Yet the United 
States has allowed itself to become so dependent on OPEC that we 
transport $570 billion a year to other nations. They are not all OPEC 
nations, but the vast majority of it goes to OPEC nations.
  Another source is coal to liquids. The United States has 496 billion 
tons of demonstrated coal reserves, which is equivalent to almost 1 
trillion barrels of oil, over 30 percent larger than the known Middle 
East reserves of crude oil. In fact, the United States is often called 
the Saudi Arabia of coal. But that may actually be an understatement, 
according to the American Coal Foundation, because domestic coal 
reserves contain more energy than that of all the world's oil reserves 
combined. Again, the United States has a phenomenal resource here that 
we are not taking advantage of.

  These are groups that are starting to now come forward--and this is, 
again, a sampling of the list--coming forward and saying the United 
States must get engaged in its own oil production.
  I know my time is running out, but the response that has been made to 
this is that: Well, we can't get this oil for another 10 years. In 
fact, some say we can't get it for another 20 years. Well, depending on 
the source or the specific location, whether it is the Outer 
Continental Shelf or the onshore sources or the oil shale, it will take 
5, 10, to 15 years to bring this resource into production. My first 
answer to those who say: Well, this will take 10 years to get on line 
is that is what you said 10 years ago. In fact, it was what was said 15 
years ago; it was what was said 20 years ago. We need to make the step 
now to begin making the United States less dependent on foreign sources 
of oil.
  It is also said we have 68 million acres of lease land that is not 
being produced right now. Well, let's take another look at what that 
means. That assumes somebody is basically hoarding acreage on leased 
land. The success rates for new onshore and offshore oil leases are not 
100 percent; in other words, not every lease the United States issues 
results in oil being produced commercially. The reason is there is not 
oil underneath all the land. The companies that have to make the 
investment to go out and explore for it and then ultimately produce it 
don't know for sure whether there is oil under there when they purchase 
the lease. So it takes about 10 years of time from the purchase of the 
lease to go through the exploration process, and then if there is oil 
found, the permitting process, and then they move forward.
  Most of the obvious places have already been leased out. The new 
leases are generating onshore about 10 percent success; offshore, 20 
percent; and then in the shallow offshore, 33 percent success. The 
point being it is far too easy to simply say: Well, we have 68 million 
acres of leases out there; let's rely on those. Those leases are all in 
the process of either being explored or being returned because they are 
not being produced.
  Let's look at the next chart. This chart shows what the status of 
these nonproducing leases is. For those who say let's go out and get 
the 68 million acres of leases and use them, right now, 50 percent of 
them are in the data-gathering process and they will either be produced 
or returned, depending on whether there is oil there that can be 
commercially found, but they are in the process of being pursued. 
Twenty-five percent they have found oil on and they are drilling or 
they are preparing for drilling. In another 10 percent, they have 
confirmed discovery and they are under construction. In 15 percent, the 
initial analysis is complete, and there is low commercial potential and 
they are likely to be returned to the Federal Government. That is the 
status of the ones that are currently not producing.
  The point, though, is those who argue we should rely totally on the 
current status of our lease effort are saying let's have no new 
production. Everything they are talking about is either in production 
or in exploration or in preparation for production, but what they don't 
tell you is that 85 percent of the Outer Continental Shelf off the 
lower 48 States is off limits to development. There are no leases 
there. Eighty-three percent of the onshore Federal lands are currently 
off limits or facing restrictions to development. There are no leases 
there.
  If you go back and think about the potential we have in the offshore 
oil, in the oil shale, in ANWR, in our onshore oil, and in the 
tremendous coal-to-liquids potential we have, there is no reason the 
United States should not aggressively seek to become energy independent 
in the arena of oil.
  There are those who say: Well, that is because the big oil companies 
have the Republicans in their pockets and as we heard today, there is 
plenty of oil being produced. We just have to look at these acres, 
these leases that are not being used. Again, the reality is the United 
States of America, since the 1970s, has said no, basically no to 
further production, and that is why we see us increasingly and more 
increasingly dependent on foreign sources of oil.
  In conclusion, the United States faces very serious threats to our 
future way of life. Our national security and our economic security are 
at risk. It is appropriate that we be here debating in the Senate on 
this issue. What is not appropriate is that ideas about all of these 
different kinds of production and renewable and alternative energy 
sources and conservation and efficiency measures are not allowed to be 
debated on this floor. Instead, we are told we are simply going to have 
a new government regulation system and the government is going to have 
a little more control of our markets and that is going to fix the 
problem of oil, and that is going to make it so the price of gas goes 
down. Well, it is not. I call on our leadership in this Senate to 
simply allow us to have a traditional, fair system of debate on the 
floor on the energy issue so we can debate all of these ideas. If some 
of them are bad, let them be voted down, but let's debate these ideas 
and the many ideas that others of my colleagues have about how we 
should solve our energy crisis in this country. I am confident if we 
will allow such a full and robust debate to occur, a tremendous amount 
of good ideas will come forward, and out of that debate will come a 
comprehensive, rational national energy policy that will focus on a 
diversification on our approach to energy and will put the United 
States on a sound, strong pathway toward energy independence.
  If we don't do that and we refuse and shut down debate and allow only 
some kind of a market regulatory solution to be put into place, we will 
find we will have fouled up our markets, caused volatility in the price 
of oil. We will not have done anything to generate one more drop of oil 
or one more kilowatt of electricity or one more energy conservation 
effort that would reduce the consumption of oil or electricity, and we 
will see gas prices continue to rise.
  It is incumbent upon us as Senators to call for a full debate. If we 
do so, the United States has the capacity, the resources, the 
ingenuity, and the ability to become energy independent and to become 
strong in the context of our energy policy.
  Thank you, Mr. President.
  Mr. President, I note the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.

[[Page S7768]]

  Mr. PRYOR. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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