[Congressional Record Volume 154, Number 130 (Friday, August 1, 2008)]
[Senate]
[Pages S7984-S7987]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




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

  Mr. HATCH. Mr. President, what is the parliamentary state?
  The ACTING PRESIDENT pro tempore. The Senate is on the motion to 
proceed to S. 3001, with Senators permitted to speak for up to 10 
minutes.
  Mr. HATCH. Thank you, Mr. President.
  Will the Chair please let me know when 9 minutes has expired.
  The ACTING PRESIDENT pro tempore. The Senator will be notified.


                         United States Economy

  Mr. HATCH. Mr. President, yesterday the Government released the 
second quarter performance of the U.S. economy, and I am sorry to say 
the report looks dismal. I, along with the rest of Americans, am 
outraged that Congress will depart shortly for a 5-week recess without 
addressing the most pressing issue of this Congress: our ailing economy 
and in particular energy. During this past month, we have passed bills 
to provide $50 billion for support of international programs to combat 
HIV/AIDS, for Medicare, and to improve FISA. This past week, we finally 
passed a bill that addresses a sector of

[[Page S7985]]

our economy by revamping Fannie Mae and Freddie Mac. I certainly 
believe we can and should have done more than that.

  In November of 2006, my party lost the majority in Congress, in both 
the House of Representatives and in the Senate. The Democrats ran on a 
platform of change, what they called ``A New Direction For America.'' 
The Democrats pledged to push forward a 100-hour agenda that touted a 
change in ethics, an increase in the minimum wage, and a rollback in 
subsidies for the oil and gas industry. Look where that ``direction'' 
has led us. The price of energy has skyrocketed, the housing market has 
deteriorated, and the unemployment rate is on the rise. Across the 
Nation, we are feeling the effects of the crumbling economy. Yesterday, 
Bennigans and Steak & Ale restaurants have filed for bankruptcy, and 
Starbucks has recently announced the closing of 600 stores across 
America. It is time for the majority to wake up and smell the coffee.
  Viewing this chart, it is no wonder why the congressional approval 
ratings are at an alltime low, at 12 percent. Congressional approval: 
12 percent. Congress has failed to act when Americans need it the most.
  At the end of 2006, when the Republicans controlled Congress, the 
average retail price of regular unleaded gasoline, according to the 
Energy Information Administration, was $2.59. Look where it is today.
  In June of this year, the average price of regular unleaded gasoline 
hit an average of $4.06. Our friends on the other side have done 
absolutely nothing to address the rising costs of energy, and we are 
going home without having done so. We have proposed increasing the 
supply off our coasts, extending the expiring energy tax incentives, 
and reducing our dependence on foreign oil by providing alternative 
energy resources. The majority refuses to provide any solid bipartisan 
solutions because they keep insisting on their perverse let's-grow-the-
Government, pay-as-you-go rules and combating the oil and gas industry 
as though they are the evil cause of everything. The fact is the 
Government does not produce one drop of oil. It does not drill one 
exploration well. It does not refine even 1 gallon of gasoline, and it 
doesn't build 1 foot of pipeline. Somehow, though, my colleagues on the 
other side of the aisle think every answer to dropping gas prices is 
more Government--more Government moratoria on drilling, more taxes on 
energy companies, more regulation of the commodity markets, more 
moratoriums on the development of oil shale, where we have somewhere 
between 800 billion and 2 trillion barrels of oil that can be 
recovered. It is doable. Estonia has been doing it for the last 80 
years. Brazil has been doing it for the last three decades. We can do 
it, but there is a moratorium that doesn't expire until September, and 
now the Democrats want to put another moratorium on it--just on 
preparing the rules pursuant to which we can develop these vast 
resources that would help bring prices down. It wouldn't happen 
overnight, but I tell you one thing, if we went and tried to do all 
these things and we announced we were going to do them, I believe gas 
prices would automatically come down quite a bit more than they are 
right now.
  This past week, the majority leader brought a bill to the floor to 
curtail oil price speculation, and while this was a start, my party 
tried to amend this bill to provide real solutions, ranging from 
expanding offshore drilling to boosting oil shale production. We were 
prevented from offering these various amendments, which was an 
opportunity to increase energy supply and to send the rest of the world 
a message that we are going to get serious about helping ourselves 
instead of sending $700 billion every year off some shore for offshore 
oil.
  Across the Capitol, the House refuses to even bring up legislation 
involving offshore drilling. I do not know how I can return home to my 
home State of Utah and explain to constituents such as Bill Howard, a 
farmer who has to increase the price of his cattle and hogs to combat 
fuel costs, that we cannot do anything about the soaring gas prices 
unless it is paid for and hurts the oil and gas industry. Americans 
need affordable energy now.
  If we look at the results of Democratic policies on job growth in our 
country, we are met with the same disappointment. Here is where we are. 
The unemployment rate in 2006 was 4.4 percent. Today it is up to 5.5 
percent.
  Less jobs means people spend less. When we spend less, companies 
start cutting back, laying off employees, and reducing employee 
salaries. This causes us to spend even less and the vicious economic 
cycle continues. We need to put more money back into the taxpayers' 
pockets over a long period of time in order to create a virtuous 
economic cycle. Among the tax extenders bill, which has failed to pass 
the Senate again and again, is the research tax credit. Seventy percent 
of research tax credit dollars are used for wages of R&D employees. 
That is creating jobs. I have been the champion of the R&D tax credit, 
along with Senator Baucus, for years.
  We should provide tax relief not through economic stimulus packages 
or on a year-to-year basis but over a long period of time so the 
taxpayers can depend on this relief. That is why it is so important 
that when we talk about economic stimulus, we should look at solutions 
rather than rebate checks and bailouts, such as repealing the 
alternative minimum tax and making certain tax cuts permanent such as 
the research tax credit.
  Looking toward the housing market, we still are puzzled why the 
majority has not provided solutions to help the economy. We have been 
hit hard by the housing market in my home State. St. George, in the 
southwestern part of Utah, and Provo, UT, were among the top ten 
fastest-growing metro areas in the United States between 2000 and 2006, 
with a growth of 39.8 percent and 25.9 percent respectively. As you can 
see, our economy has all kinds of foreclosures; in Utah we are up to 
141 percent. That is twice the national increase from a year ago.
  Last week, my friends on the other side of the aisle pushed through a 
housing bill that some estimate will provide a temporary financial 
housing lifeline by benefiting only 13 percent of the estimated 300,000 
homeowners who will likely lose their homes in the next year. I 
supported earlier versions of the bill, but as it moved through the 
process and took on new provisions, my reservations grew. There is more 
to be said about the bill than I have time for now, but I have a 
statement in the Record on the subject. Let me say I think too many 
people and organizations that do not deserve it will be bailed out by 
what is now housing law.
  I am also concerned that some of the provisions in the bill are 
shortsighted. For example, we created a new regulator for Fannie Mae 
and Freddie Mac, which is fine, but then we created what could possibly 
become a huge taxpayer-funded backstop, to put it nicely. Some have 
proposed that we cut the Government's ties to Fannie and Freddie, make 
them truly private companies, and incentivize more competition. Maybe 
we need to start the discussion now so taxpayers are not on the hook 
should future crises arise. We are on the brink of a recession and we 
need leadership.
  The Democrats' ``New Direction For America'' has led us down a road 
to economic hardship and Americans deserve to have the economy driving 
on all cylinders. With the government-sponsored housing enterprises, 
high energy and food prices, and the instability of financial 
institutions, we are in a state of economic slowdown. But there is 
hope.
  Much like today, when I came to the Senate over 30 years ago, the 
unemployment rate was rising, inflation was accelerating, and the GDP 
was beginning to decline. The economy was a major problem facing 
Americans. In response, we provided long-term solutions to our ailing 
economy by lowering taxes and increasing investment and growth. While 
the economy today is bleak, I believe there is hope because we have 
been here before. However, I do not know why the majority has not 
addressed this dire situation before adjourning.
  There are some real problems facing the American economy, and 
together we can deal with them.

  The ACTING PRESIDENT pro tempore. The Senator has 1 minute remaining.
  Mr. HATCH. Thank you, Mr. President.
  Most of these problems are self-inflicted, due to some major 
financial

[[Page S7986]]

mistakes in our country. Congress has passed some legislation aimed at 
improving our economy, but these short-term, bandaid solutions will 
eventually exacerbate the increasing deficit, and we will find 
ourselves back in the same situation. More spending certainly is not 
the answer.
  When we return from our August recess, I encourage Congress to debate 
how we can fix our ailing economy. I believe we can take steps toward 
reducing unemployment, slowing inflation, and increasing investment and 
growth. I also believe we need to look at reforming our Tax Code. Our 
tax system has become burdensome and overly complicated. It discourages 
investment at a time when we desperately need it most. For too long we 
have delayed addressing our economy, and we owe a lot better service to 
our fellow Americans.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Rhode Island is 
recognized.
  Mr. WHITEHOUSE. I ask unanimous consent to speak for 10 minutes as in 
morning business.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.


                          Oil Company Profits

  Mr. WHITEHOUSE. Let me begin by saying, as we leave for our August 
recess very shortly, what a pleasure it has been for me to serve with 
the distinguished Senator from Utah on the Judiciary Committee during 
these first months of my first term in this body. I would respond to 
what he has said by suggesting that if he and his colleagues would 
actually let us lead, we would be able to solve a lot of the problems 
he discussed and that were indicated on those graphs. However, instead 
of letting us lead, they have embarked on a strategy of creating 
gridlock in this institution with--I think at this point we are at 92 
or more filibusters--which is the world record in the history of this 
country--and climbing. I think what has happened to this body is my 
colleagues on the other side have made the decision that the record of 
George Bush is hopeless, the Republican message is shot, and their only 
salvation is to call down a pox on both our Houses and try to disable 
this institution, try to prevent us from doing essentially anything. It 
also has the added benefit of allowing the Executive more leeway, and 
it confers more power on George Bush, which I think is a mistake, given 
the way the record has shown his judgments have worked out.
  For instance, take a look at what has happened in the Bush economy 
every day and getting worse and worse. Since George Bush and Dick 
Cheney took office in 2001, wages in America have remained stagnant, as 
the very distinguished Senator from Ohio knows very well. Wages in 
America remain stagnant, oil and gas prices have risen sharply, and 
troubles in the housing market have made it harder and harder for 
families to stay in their homes. One would not have thought very long 
ago that America was a country in which tens of thousands of Americans 
would be thrown out of their own homes, but there we are.
  Even those well off enough to own stock have seen the consequences of 
the Bush economy. In the Clinton years, the Dow Jones industrial 
average climbed 129 percent. In the Bush years, it has climbed exactly 
0.7 percent. I ask my colleagues on the other side of the aisle whether 
they think their investor friends would prefer 129 percent capital 
gains and then paying a fair tax on those capital gains or whether they 
would prefer having big fights about what the capital gains tax rate 
is, but nobody makes any money.
  While American families and American workers struggle in the Bush 
economy, there is one special, favored industry that is laughing all 
the way to the bank. Eight years of two oilmen in the White House has 
brought over $4-a-gallon gasoline for American consumers and absolutely 
grotesque profits for the biggest oil companies.
  Yesterday, once again, the largest of these international giants--
ExxonMobil--announced recordbreaking profits. ExxonMobil's second-
quarter profits were the highest in the company's history. They were 
the highest in the history of the entire oil industry. In fact, Exxon's 
$11.7 billion profits for this last quarter were the highest corporate 
profits in the history of the United States. These profits, indeed, are 
the highest in the history of the universe as we know it.
  Think about that: $11.7 billion in just 3 months. The U.S. Department 
of Transportation estimates that there are 250 million passenger 
vehicles in the United States. Exxon's $11.7 billion second-quarter 
profits amount to a quarterly tax of $47 on every car and truck in the 
country. That is just for one quarter. If you have ever wondered where 
the $60 or the $80 or even the $100 that it might cost to fill your 
tank goes, take a look at this. Gas prices are definitely going up; 
there is no doubt about that. We all experience the pain at the pump. 
But compared to how gas prices are going up, look at what is happening 
to oil company profits. As gas prices have risen, oil company profits 
have soared. If Exxon continues to reap profits at this level, in 2008 
alone, you will pay for every car a $188 oil profits fee to ExxonMobil 
per car--$188 on every car in America--for the profit.
  That is not counting the hundreds of billions of dollars raked in by 
the four other major international oil companies doing business in our 
country.
  We are facing a true energy crisis. Instead of working with us to 
solve it, our colleagues on the other side of the aisle continue to 
fight for oil company profits.
  Drilling off of our pristine coasts--and I come from the ocean State 
of Rhode Island--won't produce a drop of oil for a decade and won't 
significantly lower gas prices even then. These facts have no affect on 
our colleagues. Make no mistake about it, more drilling means higher 
profits for Exxon, Shell, BP, and especially for Dick Cheney's former 
employer, Halliburton, which provides drilling products and services.
  Exxon is committed to an oil economy that has no future for this 
country. They earned $11.7 billion in profits in the last 3 months, but 
in the 4 years between 2003 and 2007, Exxon spent just $20 million on 
research and development of alternative and renewable transportation 
fuel technologies. That is $20 million in 4 years, which is $5 million 
a year. That $5 million a year is $1.25 million a quarter. If you 
compare $1.25 million a quarter to $11.7 billion in profits, what you 
find out is that for every $10,000 in profit ExxonMobil makes, it 
spends $1 on alternative fuels. I am sure that in Ohio the Presiding 
Officer is seeing the same advertisements we are seeing in Rhode 
Island--wonderful Exxon ads with scientists and molecules, telling us 
how they are investing in the future. But it is $1 for every $10,000 
they put in their pockets.
  A recent Wall Street Journal article reported that the big oil 
companies spent $52.5 million on advertisements to burnish their images 
in the first quarter of the year. That is an annualized rate of $200 
million in ads. Of course, many of these environmental ads say: We are 
green now, just watch us. Well, if you assume that of that $52.5 
million, a quarter of it was Exxon, that is $12.5 million. If you 
assume that just a quarter of that 12.5 was spent on green ads and the 
rest on other stuff, that is $3 million. That means they spend three 
times as much advertising their green research as they do actually 
doing their green research. It is the biggest sham in the world.
  I hope when Americans see these ads in magazines and elsewhere they 
know they are being had. It is $1 in research, $3 in advertising about 
it, and $10,000 in profits. That is the ratio. That is not a ratio 
anybody should be very proud of. If only Exxon and the other oil giants 
would devote some of their advertising budget to R&D, then we might be 
better off. We don't need sham solutions. We need results.
  Yesterday, I signed on to a letter authored by our assistant majority 
leader, Senator Durbin of Illinois, to request of President Bush to 
release about 10 percent--or 70 million barrels--from the Strategic 
Petroleum Reserve. That sale would immediately lower gas prices and 
generate over $8 billion, which is money that could be used to invest 
in alternative sources of energy for real--not the phony show 
ExxonMobil is putting on--so that we can finally move away from our 
oil-addicted economy. But so far, no action. Indeed, yesterday, we 
tried to pass a Defense authorization bill to support our troops in the 
field, in harm's way. The Republicans voted against the bill, 
abandoning our troops for big oil. Big

[[Page S7987]]

oil is making big money, and that is the Republicans' priority. I urge 
President Bush to end the rhetoric, put the troops first, get off of 
big oil's wagon, and let's get together to solve this problem for real.
  I thank the chair and yield the floor.
  The ACTING PRESIDENT pro tempore. The Republican leader is 
recognized.

                          ____________________