Consumer First Energy Act of 2008--Motion to Proceed

Floor Speech

CONSUMER-FIRST ENERGY ACT OF 2008--MOTION TO PROCEED -- (Senate - June 11, 2008)

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Mr. SALAZAR. Mr. President, I rise today to talk about the pain that $4-a-gallon gas is inflicting across the country. For the last 8 years, our energy policy has been stuck in the past. Today, we suffer from that neglect. Our national security is compromised by our alarming overdependence on foreign oil. Our economy is held hostage to other countries that control the oil reserves.

Every day--every day--most Americans, most of the 300 million Americans are feeling the real pain of high gas prices and diesel prices resulting from these failed policies.

Americans know the past all too well. Since 2001, the price of oil has risen more than 400 percent. The cost of a gallon of gas from Colorado is up almost 300 percent. Oh, yes, we all remember those dear old days in 2001, when in Colorado we were paying $1.08 a gallon in the beginning of the Bush administration. Yet today we are at $4 a gallon in Colorado.

U.S. expenditures during that same time period on foreign oil that we are importing into our country have more than tripled; a family's transportation costs have more than doubled. Projections show gas may reach $5 a gallon this summer.

But the numbers do not even begin to tell the real story of how our dependence on foreign oil is hurting the American people. They do not tell the story of the farmer in Kit Carson County, on the Eastern Plains of Colorado, who is worried, worried that he will not be able to afford the diesel needed to harvest the wheat at the end of the summer.

They do not tell the story of the trucker in Elizabeth, CO, whose weekly income has fallen $700 in this economy and can barely afford to fill his truck because fuel costs are higher than they have ever been.

They do not tell the story of how fuel prices have pushed several airlines into bankruptcy and led United Airlines to cut over 1,000 jobs in recent days.

In rural communities, in particular, gas prices are taking a huge bite out of the family budget. This map shows the average proportion of a family's income that is going for filling the tanks in counties across the country.

You can see which parts of the country are the hardest hit. Those are the rural counties, where upward of 16 percent of the entire budget is going for gasoline. So you see in the broad swath of what is rural America, this yellow area. Down here is my San Luis Valley, where 16 percent of the family budget essentially is going to fill the tanks of gasoline for those families.

Across the country we are paying almost $5 billion more every day for oil than we did 5 years ago. These moneys are going to the Middle East, to Russia, and to Venezuela. They are not moneys that are staying in America to make us strong. Revenues for oil-producing states and oil companies, primarily oil companies controlled by foreign governments, will reach $2 trillion this year, $2 trillion.

So while American farmers and ranchers are facing $10,000-a-month fuel bills, Saudi Arabia is using its oil riches to build four new cities in the desert; the Sudanese are building new skyscrapers and five-star luxury hotels; and Russia, Russia is using its oil windfall to increase its Federal budget tenfold.

Over the last 8 years, we have not only become more dependent on foreign oil, today we import an increasing amount of oil from those foreign countries. Thanks to the failed energy policies of the past, we are at the mercy of OPEC and the oil-producing nations of the world.

We need to move forward with a new ethic and new imperative of energy independence. We must succeed in a sustained policy that is not a stop-and-start policy on energy independence but one that will succeed in addressing the cause that I believe most of the Members of this Senate believe in; that is, to end our addiction on the importation of foreign oil.

How are we going to do this? First, we must continue to develop our domestic oil and gas resources. You heard my friends on the other side of the aisle say we are not doing enough, that we have not drilled enough in the United States of America. Yet when you look at the 2005 Energy Policy Act which I helped craft, along with Senator Domenici and Senator Bingaman, that legislation took sensible steps, in my view, to stimulate new exploration and energy development and opened the door to a whole host of items on a portfolio toward energy independence.

In 2006, we worked together, again, Democrats and Republicans, to open an additional 8 million acres in the Gulf of Mexico for energy development. Those areas contained 5.8 trillion cubic feet of natural gas and 1.26 billion barrels of recoverable oil. We were then asking that we produce more oil from our own resources in America.

Colorado is a proud contributor to our Nation's energy supply, and we are working to do more. So it is false when people say we are not doing things in America to produce for our energy supply. We have more than 34,000 active gas wells in my State right now. We have almost 5 million acres of land under lease. We are producing 1.2 trillion cubic feet of natural gas each year, up sixfold from 14 years ago.

Over the coming years, we will contribute even more to our Nation's energy supply. The BLM estimates that over the next 20 years we could have 17,000 more gas wells in 3 of our western counties alone.

Let me say, are we against energy development in America? You tell me that the construction, the drilling of 17,000 wells in 3 of my counties in the State of Colorado is not contributing to the American supply of oil and natural gas that we need in America? We are doing a lot already here.

But for those on the other side who accuse us of doing nothing, they are wrong. I have also introduced legislation to open additional areas in the State to oil and gas development, including the Roan Plateau in western Colorado. But we want to do it the right way.

Let's not kid ourselves. Expanding domestic oil and gas production will not lower gas prices or kick our addiction to foreign oil. Americans consume 25 percent of the world's produced oil, but we hold less than 1.7 percent of the world's proven oil reserves.

This chart shows us a little slice of the pie that is 1.7 percent. One of my colleagues earlier said it is 3 percent of the world reserves. These are the figures from the Central Intelligence Agency. The CIA tells us we control 1.7 percent of the global proven reserves of oil. Yet we are consuming 25 percent of those reserves.

So what my colleagues on the other side are saying is that we are going to take this little slice of the pie and somehow magically address the huge oil security problems we are facing today. That is not accurate. We need to be honest with ourselves and the American people about our energy future.We simply cannot drill our way to energy independence.

If we threw open the doors of America's most treasured landscapes to drilling, it would still just be a drop in the bucket. According to the Energy Information Administration, drilling the Arctic Wildlife Refuge would, at peak production, which would be somewhere between 2018 and 2030, reduce the cost of gasoline by less than 4 cents per gallon.

We need to be honest with ourselves and the American people about our energy future. We simply cannot drill our way to energy independence.

Some dream that oil shale will save the day.

Oil shale deposits in Colorado, Wyoming, and Utah amount to somewhere between 500 billion and 1.1 trillion barrels of oil. That is more than double the proven reserves of oil in Saudi Arabia.

The trouble is, the oil is locked up in rock and, even after $10 billion of research and development, nobody has figured out an economical way to get it out.

If the technology were ripe, companies like Shell would already be developing oil shale today on their own lands. Shell and other companies already own nearly 200,000 acres of prime oil shale reserves in Utah and Colorado. Nobody, not the Federal Government, not the Congress, not the State, is stopping them from developing these tracts. But they are not ready, and that's what they have all told us in testimony. They are still struggling to overcome technological and economic barriers.

We can help companies such as Shell overcome these barriers through research and development incentives like the ones I helped put in the 2005 Energy Policy Act, but even under the most optimistic estimates, the technology won't be ready for commercialization until 2015.

So let's be honest about oil shale. Let's not pretend there is a magic wand that we can wave that will unlock the mystery of oil shale. Let's be honest about our energy future. Let's be honest with the American people.

Responsibly expanding our domestic production is only one part of the solution. As I have said repeatedly over the last 4 years, we also need to be improving our energy efficiency, investing in technologies, and developing our clean energy economy. We have taken several steps in the right direction.

At the end of 2007, Congress passed legislation to increase fuel efficiency standards in cars and light trucks by over 40 percent by 2020. This will save over 1.1 million barrels of oil a day.

The bill we passed, the Energy Independence and Security Act of 2007, also helps spur the rapid development and deployment of advanced biofuels, such as cellulosic ethanol. The bill quintupled the existing renewable fuels standard to 36 billion gallons by 2022, 21 billion of which must be from advanced biofuels, such as cellulosic ethanol. That is more than enough to offset our oil imports from Saudi Arabia, Iraq, and Libya combined.

I was also proud of the work we did in the farm bill to spur cellulosic biofuel production, which has the potential to dramatically reduce carbon pollution. The farm bill includes a provision I sponsored that provides a $1.01 per gallon tax credit for the production of cellulosic biofuels. It is the first incentive for cellulosic biofuels of its kind.

Why is this so important? Because cellulosic biofuels have the potential to displace 3 billion barrels of oil annually, equivalent to 60 percent of our country's yearly consumption of oil in the transportation sector, without affecting our need for food, feed or fiber, 3 billion barrels of oil a year.

Dramatically increasing our biofuels production can and will help us get control of gas prices and reduce our dependence on foreign oil.

In fact, if it weren't for current ethanol production, gas prices would be even higher than they are today.

Merrill Lynch estimates that gas prices would be 15 percent higher if it weren't for our ethanol production. Do not make biofuels the scapegoat.

In addition, studies are showing that, as a result of our renewable fuels standard enacted in 2005, U.S. oil imports recently declined for the first time in a quarter century.

Unfortunately, there are some who just cannot accept the fact that biofuels can and should be a larger part of our energy future. They're finding any excuse to advocate yesterday's energy policies and step back into the past.

These renewable energy opponents claim, for one, that biofuels production, in particular corn ethanol production, is to blame for high food prices.

This is absurd. There are three factors that are driving food prices up, and ethanol production is not one of them.

First, food prices are rising because global demand for grains, particularly from China and India, is rising.

Second, the global food supply is down because of drought conditions in several areas of critical agricultural production. Still, U.S. producers are doing everything they can to boost supplies. Not counting corn used for ethanol production, we produced 17 percent more corn food product and exported 23 percent more food product overall in 2007 than in 2006.

Third, rising oil prices are making it more expensive to produce food. Petroleum costs are embedded in every part of the global food supply chain. Recent studies by USDA reveal that for every dollar we spend on food, only 20 cents is the cost of the food product itself. The other 80 cents or so are the costs of labor, energy, transportation, and other factors.

The best economic minds agree that ethanol production is having little, if any, effect on food prices. Ed Lazear, chairman of the President's Council of Economic Advisors, recently reported that ethanol production accounts for less than 3 percent of the increase in global food prices.

Those who claim that biofuels production is driving up food costs are flat-out wrong.

Let's not forget where today's high gas prices are hurting most, it is in America's rural communities. Farmers, ranchers, small business owners, families in small towns, they know the true cost of our addiction to foreign oil. They feel it every day.

They also know that the solution is not far away. They know that the solution lies in our farms and fields, in the promise of cellulosic ethanol and in the ingenuity of the American worker.

Our rural communities know we can grow our way to energy independence if we continue to pass and implement policies that stimulate our clean energy economy.

So let's not let them down. Let's not turn the clock back to the failed energy policies of the last 8 years. Let's not pretend that the 1.7 percent of the world's oil reserves that we possess will meet our energy needs. Let's be honest with the American people. Let's build our clean energy economy. Let's pass the tax extenders that Senator Baucus, I, and others have developed that will stimulate renewable energy development. Let's give these growing industries the tax certainty that they and their investors need to move forward with projects that are creating good-paying jobs across the country. Let's get after the speculation in the oil market. And let's get to work on breaking our addiction to foreign oil.

I will conclude by making a few additional comments. We have heard from the other side of the aisle that oil shale somehow is magically going to develop as part of the solution for our energy independence and deal with gas prices today. The truth of the matter is, we supported the oil shale provisions in 2005 and have been moving forward in the development of oil shale in Colorado in a responsible way.

Yet we know that even after the investment of billions of dollars, the technology is some 6 to 7, maybe 8 years away before it can be even commercially developed, if it is proven it can be done. Yet there is this accusation that is coming from the other side of the aisle that somehow the development of oil shale is going to deal with the immediate crisis we face today. That is simply a false charge. We need to move forward and attempt to look at the development of oil shale in an environmentally responsible way.

Another point, before I conclude, is we need to continue to grow our way to energy independence. I am a proud sponsor, with Senator Grassley, of the 25-by-25 resolution. I think America's farmers and ranchers can help us move forward so we can produce 25 percent of our energy from renewable energy.

I am hopeful this energy crisis does not create an opportunity for us to take a step back on the investments we are making in biofuels. Biofuels are a significant way in which we will move forward to energy independence.

I believe strongly there are parts of our energy agenda that Republicans and Democrats can come together on, but I am hopeful the stalling tactics that keep us from moving forward to crafting an energy bill will end so we can deliver on solutions to the American people.

I yield the floor.

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MEDICARE

Mr. SALAZAR. Madam President, I come to the Senate floor this afternoon to speak about the Medicare package we will be voting on cloture on, the legislation that Senator Reid filed for cloture yesterday. We will be doing that vote sometime tomorrow. Before I make my comments about that particular piece of legislation, I want to make a few comments in general about the importance of the health care agenda and the health care challenge that faces America.

For all of us who are in elected office in all of our States, we hear about the pain the people of America are feeling from a number of different perspectives. We hear loudly and clearly that people in our States are very concerned about what is happening with the runaway prices of oil and the high cost of gas and diesel and the farmers and ranchers and the businesspeople and consumers in general, just concern about that cornerstone of our economy which is causing so much pain to the people of America today.

We also hear about another cornerstone of concern, and that is what is happening with the housing crisis, the housing crisis which, in many ways, has ignited the economic instability we face in America today, where people are losing their homes, record foreclosures are occurring, and people want to know what it is we are doing in Washington to address the dream of home ownership for America.

In my State, it is projected that in the year ahead and in 2009 there will be about 50,000 homes that will go into foreclosure. There will be about a third of the housing stock that will have a decline of anywhere from 12 to 15 percent in value over the next several years. Those two cornerstones of our economy--energy and housing--are trembling a little bit today. It is important for all of us in the Congress to do what we can to try to stabilize our energy policy and energy prices and also to deal with the challenges we face in the housing crisis.

There is another cornerstone in our economy which is something we need to address. We will do small pieces of it here, but it has to do with health care. Health care today is a huge challenge and problem for America.

In the Presidential debates, one of the hot topics will be how will the next leader of the greatest democracy in the world help us address the huge challenges we face in health care. One thinks about the fact that there are 47 million Americans who do not have health insurance today. One thinks about my State of Colorado with a population of under 5 million people. Today there are 850,000 Coloradans who don't have health insurance, and of those 850,000, 180,000 are children, children without health insurance in our State.

As I look at the issue of health care in general, one of the cornerstones that face our country in terms of the economic and real human pain we are facing, I am proud of the fact that there are people in the Senate who are trying to figure out a way forward already.

First, Senator Baucus, chairman of the Finance Committee, has decided this is an issue we need to learn a lot more about. So we have a series of hearings on what is happening with health care, what is happening with health care in other places around the world. Next Monday we will be having a health care summit to try to further our understanding on how we can deal with this incredibly difficult issue. Then in the mix of all that dialog, my good friend from Oregon, Senator Wyden, who just happens to be on the floor--totally by coincidence--has offered for all of us to take a look at the Healthy Americans Act.

The Healthy Americans Act is important because it is the only piece of legislation that has come to the Senate in a manner that is a comprehensive health care reform package, but also, importantly, it has the kind of bipartisan support which, at the end of the day, will be required in order for us to fix the very complex health care problems and challenges we face today.

I applaud him and both my Democratic and Republican colleagues who have joined him in that effort. It is the only significant bipartisan piece of legislation that has been considered in Washington for a long time. But the issue of health care and health care reform is not going to go away this year. It is an issue I expect will loom large on our plates right after the January 2009 inauguration. Many of us will be working to try to find the right solution that fits the American population. I very much look forward to working with my colleagues on that on a bipartisan basis and to working with my good friend, Senator Wyden, on that agenda as well.

I wanted to speak about a ticking health care emergency that, if unaddressed, will affect millions of doctors and patients across the country before the end of the month. In 19 days from today, Medicare reimbursement rates are scheduled to drop 10 percent, based on an outdated formula that we desperately need to fix. A 10-percent cut to Medicare reimbursement rates will force tens of thousands of doctors into the red, tens of thousands of doctors across America in every one of our States. Millions and millions of Medicare patients will find that their doctor simply cannot afford to treat them. Every single Member of this body has heard loudly and clearly about the devastating effects these cuts will have on patients and on doctors. Here are just a few things I have heard over the last several days.

This is from Dr. Mike Wasserman, a Colorado physician who is in a group practice that focuses solely on Medicare patients. He said:

A 10 percent cut is untenable. I would have to seriously consider immediately closing our practice if this were to actually stick.

Other comments that I have received in my office from others:

Many primary care physicians will not only stop taking new Medicare patients but will consider reducing their current Medicare load. That means more patients being cared for by higher cost specialists. Conceivably, this could actually lead to greater Medicare expenditures.

Finally:

This cut will have a devastating impact on health care across the board as most commercial insurers and TRICARE tie their rates to Medicare.

Let's keep these realities in mind as we try to forge ahead in the next 19 days, and hopefully sooner, to try to fix the Medicare issue which faces us today.

The June 30 Medicare cuts will affect military health care plans through TRICARE. We will have the rug pulled out from under the feet of TRICARE if we don't fix this problem. For me and for the soldiers in Colorado at Fort Carson, for the airmen at Schriever, Peterson, and Buckley Air Force Bases, and for our Guard and Reserves, I know they will find that fewer doctors will see them, their spouses, and children. It will be more difficult for returning service members from Iraq and Afghanistan to get treatment for PTSD and for wounds they have incurred on the battlefield on our behalf.

As the largest purchaser of health services, Medicare rates also serve as a starting point for private insurers. This means the impact of a cut will eventually be felt by middle-class families as well.

We cannot let this happen. We cannot let Medicare reimbursement rates fall on June 30. That is why I am pleased that Senator Baucus and a bipartisan group of Senators on the Finance Committee have introduced a bill that would correct this problem. I strongly support this bill, the Medicare Improvements for Patients and Providers Act. I thank the leadership of Majority Leader Reid for giving us the time to bring this matter to full debate and conclusion, hopefully, on the Senate floor. We have to get this bill done. We have no choice.

In addition to saving doctors and patients from the June 30 Medicare cuts, the bill makes several fiscally responsible improvements to Medicare and Medicaid, including, first, the bill improves critical programs to ensure seniors and individuals with disabilities on a restricted income can afford the health care prescriptions they need to stay healthy. Second, the bill extends and expands rural health programs. Third, the bill expands coverage of preventive services which are so needed in health care. Fourth, the bill reduces coinsurance for mental health services. Fifth, the bill addresses overpayments and unscrupulous marketing tactics in the Medicare Advantage Program. Finally, the bill will protect the long-term solvency of the Medicare Program.

Curiously, the Medicare bill introduced today by Senator Grassley, my good friend and the ranking member on the Finance Committee, mirrors many of these provisions. While the differences may not be in number, the differences, nonetheless, in my view, require us to move forward with the version of the bill Senator Baucus has introduced.

The PRESIDING OFFICER. The time of the Senator has expired.

Mr. SALAZAR. I ask unanimous consent for an additional 30 seconds.

The PRESIDING OFFICER. Without objection, it is so ordered.

Mr. SALAZAR. The one thing we have always agreed on is that the goal of the Medicare Program is to provide affordable, high quality health care to our Nation's seniors. The Baucus bill is the only option that does that, with nearly $4 billion in beneficiary improvements. The Baucus bill also addresses one of the biggest concerns of Medicare Advantage, the lack of reliable networks for private fee-for-service plans. By requiring private fee-for-service plans to have a written contract with providers, this bill makes sure patients have access to the providers they are promised, and doctors will get paid for the services they provide.

For nearly 40 years, patients have relied on Medicare, knowing that they would not fall through the cracks. We must continue to protect the integrity of Medicare's good name by swiftly addressing inadequacies. The Baucus bill will do just that.

Too much is at stake to let this bill get stuck in the politics of obstructionism. For Medicare patients, for their doctors, for parents, kids, soldiers, and service members' families, we need to get this done before the June 30 deadline.

I yield the floor.

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