[Congressional Record (Bound Edition), Volume 154 (2008), Part 11]
[Senate]
[Pages 15433-15435]
[From the U.S. Government Publishing Office, www.gpo.gov]




                                 ENERGY

  Mr. SESSIONS. Mr. President, I know we are moving to the bill that 
deals with speculation, which is designed to bring down the price of 
gasoline. I think there is a bubble out there of some kind in the price 
of gasoline, at least I hope so. If that is so, I think we could see 
that bubble burst or some of the steam come out of it. I think it is 
something we ought to encourage.
  Some of my colleagues on the Republican side of the aisle, 
justifiably, are concerned that we are trying to pass a law that will 
end the right to contract, end the right to protect yourself from 
rising costs, and those kinds of things. I, frankly, am not that 
worried about it. I think there is a danger we could overregulate the 
futures market. I do not think, historically, we have ever attempted to 
do that in any fundamental sense.
  It is pretty clear, if we do not have a futures market here, one will 
exist in some other place in the world, as they already do today. So I 
guess I would say, if you can come up with a good bill that does not do 
any real damage, that it might help reduce speculation, I would be 
inclined to consider it and give it a fair shake.
  But I do not believe that is the problem we have today. I believe 
people are speculating and driving up prices from that speculation, if 
it is occurring--and it probably is to some small degree--because there 
is a shortage of the amount of oil on the world market, that the demand 
is greater than supply. When the price of oil on the world market was 
$20 a barrel--that was not too long ago--$40 a barrel, if the 
speculators were so powerful, why didn't they drive it up then?
  What happened, according to most experts, is we are consuming about 
87 billion barrels of oil a year, and we are producing about 86 
billion. Supply is inelastic and demand is inelastic. So when the price 
goes up, people do not stop using it much.
  We are beginning to see about a 3-percent reduction in the American 
use of gasoline, after a doubling of the price. So most people would 
like to use less, but between their work and their family and their 
just needs, they have to use automobiles in this country, and they are 
not able to go out and sell their pickup truck or their SUV and buy 
some hybrid automobile this week. It would be nice, but people cannot 
afford to give away those things they have invested large amounts of 
money in.
  We have done the calculations on it, and I have concluded that based 
on 24,000 miles traveled by a typical two-car American family per year, 
the increase in gasoline prices, in 1 year, means that family is paying 
approximately $105 more per month--per month--than they were just 1 
year ago for the same number of gallons of gasoline.
  This is after your taxes are paid, after your retirement 
contributions are made, after your insurance is paid, after your house 
payment is paid. After that, there is not that much aftertax money for 
the average American. They have to watch how they spend it. To have, 
out of the blue, in 1 year, another $105 a month out of that paycheck 
is something that is a real hit to them. I believe it is impacting 
families significantly, individuals significantly, and it is hurting 
our economy also. There is no doubt about it, to my way of thinking.
  There are some things we can do. I wish to be frank with my 
colleagues. I have been disappointed in the Democratic proposals. Some 
weeks ago, when we first started talking about energy, the proposals 
that came forth had three basic criteria--three principles.
  The first one had to do with taxing oil companies. Now, I am not 
saying we should never tax oil companies any more than they are being 
paid. But if our problem is a shortage of oil--and I believe 
fundamentally that is the situation--to tax the people who produce it 
is not a way to get more of it. What you tax, you get less. What you 
subsidize, you get more. So that certainly is not a long-term solution 
to the crisis we are facing today.
  Another proposal that was in the package at that time was that we 
would sue OPEC, we would sue the oil-producing nations that collaborate 
together and decide they are going to constrict the world supply of 
oil, therefore creating shortages, therefore driving up the price of 
oil, and allowing them to make even more money per gallon than they 
were making before.
  They are doing that. They are absolutely meeting to control the 
production of oil, with a goal to drive up the price of oil and gas on 
the American consumer. In one sense, as I have said for several years, 
when OPEC meets, they meet to decide how much to tax the American 
consumer. We need a systemic, long-term strategy to confront that 
problem politically and any other way we can do it because it is not 
right what has been happening.
  So production in Saudi Arabia, Venezuela, Russia, and even Mexico is 
down. They do not have much incentive to increase their production 
because the price has gone from $40 a barrel on the world market to 
$140 a barrel--now dropping maybe 10 percent in the last few days. 
Thank goodness we are beginning to see a little better trend. But who 
knows whether it will be permanent. So by reducing their production, 
shortages have been created, and that has spiked the prices. I am very 
unhappy about that.
  But I am a former U.S. attorney, Federal prosecutor, as the Presiding 
Officer is, and I am not aware of how it is possible for the United 
States of America to file a lawsuit against a sovereign nation to try 
to order them, I guess--what court is going to do this--to order them 
to produce more of the oil that is in their ground, if they do not want 
to produce it.
  I do not think we are going to be successful on that. I think that is 
just talk. That is just ``flapdoodle.'' That is not going to work. But 
I tell you, it might be possible, frankly, let me say, that if we had 
to have a lawsuit of that kind, we would probably have a better chance 
of having it filed against the Congress. Maybe Senator Reid would 
accept service because this Congress is keeping America from producing 
our own oil and gas offshore, onshore, in Alaska, and other places.
  We have systematically passed laws and regulations that have 
prohibited the production of our own resources. Yet we are going to 
complain about some other country that does not produce? I think that 
is rather silly. I think the speculation matter--and I am open minded. 
I do not have an automatic rejection of a speculating bill. I would 
support, certainly, more investigators to see if there is fraud going 
on out there, and I suspect in some places there is. But, 
fundamentally, I am convinced from my study that the problem we are 
having is we are using more and more. China is using more and more. 
India is using more and more oil and gas.
  I visited South America a couple years ago as a part of a 
congressional delegation. All those countries are growing at 6, 7, 8, 9 
percent a year. They are using more and more oil and gas. So the world 
supply is not growing. In some of the biggest countries it is 
declining. As a result, we have a shortage here, and we need to develop 
some ideas to go forward.
  We passed CAFE standards, on a bipartisan basis, that I think was a 
good piece of legislation. Several years before that was attempted--
maybe 6 or so years ago--it was attempted, and some of us voted against 
it. I think perhaps a good case can be made that was a bad vote. Things 
were going along well at the time. The price of oil and gas was not too 
high, and we did not want to tell our consumers they had to have 
smaller automobiles and have more expensive automobiles that got better 
gas mileage.
  But after the prices went up last year, a lot of us saw we had a 
crisis facing the country, and we have now passed a lot higher 
standards, which I think will help us, and we would have probably done 
better had we passed those standards some years before.
  Likewise, I would note it was pretty clear, at that same time period, 
we were coming to a point where oil was going to become more valuable, 
we were going to have a crisis in the future, and many of us spoke--and 
I have spoken many times on this floor--about the need to produce from 
those

[[Page 15434]]

great reserves in Alaska, the need to produce oil and gas off my coast 
of Alabama. Off the gulf coast, it is being produced safely. People go 
fishing around the oil rigs. Large amounts of oil and gas are coming 
out of those wells. But huge portions of our gulf and both the Atlantic 
and Pacific coasts are totally blocked from producing.
  We have hundreds of wells in the Gulf of Mexico, some of them way out 
there, that are producing large amounts. They have been so much better 
today in knowing how to prevent spills, and we have almost no spills 
occurring in the last 20 or 30 years. So we need to do more of that. We 
have had vote after vote after vote and people have blocked it.
  So I say people who have been blocking more production need to do 
like some of us who were not supportive of the higher efficiency 
standard mandates on automobiles, to begin to rethink their position. I 
think that is happening. I do believe a lot of Members of this body are 
concerned about this increase in prices. They know it is hurting 
American citizens. They know it is taking money out of their 
pocketbooks. They know it is going to many of these rich Gulf States 
that have so much money they don't know what to do with it. They are 
building skyscrapers and five-star hotels and golf courses in the 
desert and all kinds of incredible things with our money. Seven hundred 
billion dollars a year is going abroad to purchase the 60 percent of 
the oil we import to use in our automobiles. Over half of the oil and 
gas in our automobiles is imported. This is not good. This is impacting 
our economy negatively. All things being equal, which would you rather? 
Have us produce oil off our coast and keep all that money at home--
Alabama gets to share a little bit of the resources. This is what 
happens in the gulf today: The States that approve deep gulf production 
get 37\1/2\ percent. We passed this 2 years ago, 3 years ago, in this 
Congress. Twelve-and-a-half percent goes to the Land and Water 
Conservation Fund, a prime environmental fund of the U.S. Government, 
and 50 percent goes to the U.S. Treasury.
  Now, some of us have read--and I think most Americans have seen with 
some positive feeling--that Brazil has identified what appears to be 
very large reserves off the coast of Brazil. We are so happy. We are 
happy they are in the Atlantic. We want them to produce, because that 
will bring on more supplies and can help bring down the price of oil, 
but we have our own right off our shores. Why would we prefer to send 
our money to Brazil by the billions and tens of billions, hundreds of 
billions of dollars to purchase oil when we can be keeping it all at 
home, helping this economy? I have to tell you, it is not in good 
shape.
  This drain of wealth to buy foreign oil is a negative factor in this 
economy today and it is hurting us in ways a lot of people don't fully 
realize. If you are now paying, on top of your house note that you 
stretched yourself to be able to pay when you bought that house as a 
young person and now you have to pay another $105 for gasoline--and, in 
fact, according to the Cato Institute, electric bills have doubled in 5 
years because of primarily increased energy costs--is that not a factor 
why a lot of people are not able to pay their mortgages? Well, I think 
it is. However, there are some who are so determined to fight fossil 
fuels that even though they are not able to stop the importing of oil 
into America that we burn in our automobiles, they have been successful 
in blocking America from producing its own. We do it cleaner and safer 
and protect the environment to a far greater degree than I would think 
any country in the world, except maybe the people in Europe who are 
doing it in the North Sea, which is a rougher, more dangerous area to 
produce oil than off our gulf.
  I ask: How have we gotten ourselves in this predicament? When the 
great party--the great Democratic Party which has the majority in the 
Senate and a majority in the House of Representatives--is called upon 
to respond to a national crisis where the price of oil is surging and 
American pocketbooks are being drained every month, they propose the 
only bill we have now on the floor, which is a bill that is going to 
deal with speculation. I don't think that is good enough. I think it is 
not the fundamental values of most of our colleagues--Democratic or 
Republican.
  I am prepared to look very hard with all of my colleagues in a 
bipartisan way to consider how we can produce more than just fossil 
fuels, more than oil and gas and coal and those things. Let's look at 
the biofuels. Let's look at solar. Let's look at wind. Wind is coming 
around. Wind is becoming more feasible today than we have seen it. The 
Government has a big subsidy in wind and that has encouraged the wind 
people to produce lots and lots of energy, but it is not the most 
reliable source of energy. Electricity, that is what it produces--
electricity, not oil for our gasoline, for our car engines. I am 
prepared to consider other things.
  Why have we created a system in America in which 97 percent of our 
automobiles burn gasoline, whereas in Europe 50 percent of the cars are 
diesel? We have new clean diesel technology today. Diesel engines get 
35 to 40 percent better gas mileage than our gasoline engines. Can you 
imagine that, 35 to 40 percent better gas mileage. It is actually 
better. According to Popular Mechanics, it gets better gas mileage than 
a hybrid engine. Why don't we go back to more diesel energy and work in 
that way? I am seeing in my home State several facilities that are 
coming on line that I believe will soon prove we can take waste wood 
product and convert it to a liquid fuel that we can burn in our 
automobiles. Ethanol--or biodiesel, which is even better fuel than 
ethanol--and we can do it well below the world price of gasoline. I 
have my fingers crossed. I believe that is going to happen. I have been 
looking at that closely and I have supported the efforts that will 
promote that.
  About 5 percent of the fuel we utilize in automobiles is ethanol, 
which comes primarily from corn. The next step is to use wood, 
particularly waste wood products that are left in the woods after sawn 
logs are cut. Wood is taken out of cities that you have to pay to 
landfill and it becomes a waste product. Paper, automobile tires, all 
of this can be converted to fuel and maybe we can get that up to 10, 
12, 15 percent of our supply on biofuels.
  We are also excited about the possibility of plug-in hybrid 
automobiles. These are automobiles that have a hybrid engine, but you 
plug them in at night, you charge your battery from 11 p.m. to 5 a.m. 
when the grid has a low demand on it, charge your battery, and be able 
to drive back and forth to work. The goal is 40 miles without ever 
using a drop of gasoline, all electricity coming out of the grid. It is 
clean, more cleanly produced, more friendly to the environment, and 
reduces our dependence on foreign oil because our electricity is all 
American produced.
  Finally, let me not ignore what I believe has perhaps the greatest 
potential for America and the world environmentally and economically, 
and that is nuclear power. We have 104 nuclear powerplants in America 
today. They produce about 20 percent of all electricity. Not a single 
American in the 40 years we have been producing electric power has died 
as a result of a nuclear accident--not one. It has continued to be more 
and more efficient. In fact, right now the cost is as low as any source 
of energy we have.
  I say to my colleagues, we are getting to a point now where the lines 
between electricity and automobile transportation are being blurred. 
Energy is energy. We will be able to transform electricity into a power 
source to turn the wheels of our vehicles and that will be a tremendous 
advance. If that electricity is produced at a very cost-effective rate 
by nuclear power that emits not one bit of CO2 into the 
atmosphere, that emits no pollutants into the atmosphere--you only have 
this small amount of nuclear waste that I believe should be 
reprocessed.
  Senator Domenici and I have offered legislation to do that, but the 
amount of waste that is now being produced is still very small in size. 
Every bit of it in the United States can be placed on one football 
field and not too many

[[Page 15435]]

feet deep. It is not a problem that can't be solved, and it doesn't 
blow up. You have to reprocess it or put it away from people so it 
doesn't damage anyone or the environment.
  I think we are heading in the right direction. I believe our Nation 
is getting its feet on the ground. I think the American people know--
they know, they are not going to be fooled; they have no 
misconceptions--the way to contain the growth in the price of energy is 
to reduce our demand by conservation and increase our supply, and it 
will help our economy dramatically if the increase in supply is 
American energy, not imported energy. Those ought to be our goals. We 
can do that. We can reduce CO2. We can use more biofuels. We 
can use more clean nuclear power. As a result, this economy can 
continue to function and be the envy of the world.
  I note it should never, ever be a policy of our country to drive up 
the price of energy. Low-cost energy is a wonderful event for the 
world. It is one of the great things about this Nation. We have had 
relatively low-cost energy for many years. I was flabbergasted when one 
of the Presidential candidates, Senator Obama, said he wasn't worried 
so much that the price was going up, it just went up faster than people 
liked. That is not what I think is good policy. Our policy should be to 
take the steps now. Even if they take 5, 10, or 20 years to come to a 
reality, that will help ensure this surge in price does not continue; 
that we can maintain our American independence so we are not held 
hostage by foreign powers, this unprecedented transfer of wealth will 
end, and we can fight pollution and continue to clean up our 
environment.
  Mr. President, I thank the Chair and yield the floor.
  Mr. THUNE. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER (Mr. Nelson of Florida). The clerk will call 
the roll.
  The legislative clerk proceeded to call the roll.
  Mr. THUNE. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. THUNE. Mr. President, I ask unanimous consent that I be able to 
speak as in morning business for up to 15 minutes.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.

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