[Congressional Record Volume 155, Number 49 (Monday, March 23, 2009)]
[House]
[Pages H3722-H3723]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                          ENERGY AND ECONOMICS

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from South Carolina (Mr. Inglis) is recognized for 5 minutes.
  Mr. INGLIS. Mr. Speaker, following up on the gentleman from Texas 
(Mr. Poe) in talking about energy, I have got a different take on that, 
and the different take is this: It is all about economics.
  Actually, technologies exist right now to be the alternatives. The 
problem is, they don't compete real well against the incumbent 
technology, because the incumbent technology doesn't have all of its 
negative externalities attached to it. If you attach those 
externalities to those incumbent technologies, all of a sudden new 
things would happen. And rather than being driven by government and 
grant programs for this or that, it would be driven by free enterprise, 
with people making money selling the competing technology.
  What do you have to do to get there? You have got to figure out a way 
to, what economists call, internalize the externals. You have got to 
figure out a way to attach to the incumbent technologies, which in this 
case with transportation is gasoline, attach the negative externalities 
to the price. In other words, demand accountability. Insist on 
accountability. Say we are going to attach the national security risk, 
for example, to gasoline, and we are going to say, what is it really 
costing us for a gallon of gasoline? Is it the $1.90 that I paid 
recently in my car, or is it a lot more than that? The answer is, it is 
a lot more than that.
  If you consider just the supply chain that we have to protect the 
assets that we have forward deployed to protect the supply chain, and 
attribute some percentage, it doesn't have to be 100 percent, but some 
percentage of the cost, for example, of protecting the shipping lanes 
that carry this stuff that we are addicted to, to us, if you just 
attach the cost of a percentage of that, maybe 50 percent of it, give 
50 percent cost accounting to somebody else, somebody else's account. 
But let's account to gasoline at least 50 percent of the cost of the 
operations in protecting the shipping lines. If you do, it is not $1.90 
a gallon. It is a lot more.

                              {time}  1945

  But as long as there is an unrecognized externality, then what 
happens? There is a market distortion. And as long as that market 
distortion exists, nothing happens in free enterprise. Because what 
free enterprise is about is a wonderful thing called ``making a 
profit.'' And the people generally on this side of the aisle understand 
very well that we are in business to make money, to make a profit. But 
when

[[Page H3723]]

your competitor gets a freebie in the national security realm or a 
freebie when it comes to climate change impact, or a freebie when it 
comes to, say small particulates, when it comes to coal, nuclear 
doesn't develop, and alternative energies don't develop because you 
have got this freebie.
  Why not continue on with the cheap old technology, the one that 
really doesn't take a lot of rocket science? You stick pipe in the 
ground, out comes some crude, you refine it, stick it in a car and you 
run it. Not real rocket science. But how about some rocket science of 
hydrogen, for example? Well, you have to internalize some externals in 
order to make that work for a profit-making venture.
  Until then, we will be talking science projects. I'm on the Science 
Committee. I'm happy to do science projects. But what I really want to 
have happen is to have people making money selling the competing 
technology. Here is a way to do it. We are just hearing about how we 
don't want more taxes. So let's start with a tax reduction. What if you 
reduce taxes on something, say payroll or income, and then in an equal 
amount, apply a tax to carbon-based fuels? Then we will see what 
happens. What would happen then is all kinds of exciting things. The 
new entrepreneurs in the energy field, the Bill Gates of the world in 
energy would suddenly do for energy what Bill Gates at Microsoft and 
Steve Jobs at Apple did for the PC and the Internet. America would 
break free. It would be no additional intake to the government, and Mr. 
Speaker, we would be on our way to energy independence.

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