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Public Statements

Offshore Production and Safety Act of 2011-Motion to Proceed

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Date:
Location: Washington, DC

OFFSHORE PRODUCTION AND SAFETY ACT OF 2011--MOTION TO PROCEED

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Mr. COBURN. Mr. President, I am pretty amused at what the Senate is doing. We sit here with a $1.6 trillion deficit and we are running bills based on political philosophy rather than what the real problems are in front of our Nation.

Do my colleagues know why oil is expensive today? It is because the dollar is on its back and oil is priced in dollars. If we want the price of oil to go down, as it has this week and the tail end of last week--if we want the value of the dollar to go up, because the world trades oil in dollars--why is the dollar down? The dollar is down because an incompetent Congress continues to spend money we don't have on things we don't absolutely need. If we want the dollar to improve in value, what we have to do is hold the Congress accountable for doing what they were elected to do, which is live within our means. We can't come together and solve the very real problems.

Do my colleagues realize that if, in fact, our deficit wasn't $1.6 trillion but about $600 billion, the price of the dollar would shoot way up and the price of oil would go down? We hear all these stories. I get all these letters from my constituents who say: Well, we have to eliminate the commodity speculation. We can do that in this country. We can say you can't speculate on oil unless you can take delivery. That will do nothing to the speculated price of oil because oil is an international commodity and people are always going to speculate on what they think the price of a needed commodity is going to be.

So if we controlled all the economics in the world, we could control that speculation, but we can't. What we do know is price controls don't work. They don't work at all. So if, in fact, we want to fix the price of oil, what we have to do is fix our economic mess and strengthen the dollar, which will lower the price of oil and lower the price of gasoline.

The debate we are going through is all about politics, creating somebody who is bad. Do my colleagues realize the five big oil companies make less than 8 percent return on their sales? They make a lot of money, but they are giant companies. But compared to most other of the S&P 500, their return on sales is far less, and they are not making record profits. They made record profits when oil was at $142. That is when they made record profits. It is this terrible habit we have of saying--and let me throw a corollary. If I am an Iowa farmer or from Indiana or Illinois or Oklahoma and I have a great corn crop and the price of corn is $4 and I decide not to sell my corn, I decide not to sell it, and now all of a sudden corn is $6.80, I am going to sell it now at $6.80. What are we going to do? Are we going to penalize that farmer for having a resource he took a risk on and selling at a higher price? Are we going to say we are going to double or triple tax you?

The other thing I am amazed at--most people know me as a doctor, but I spent 10 years as an accountant and business manager. I have a degree in accounting. The lack of knowledge of my colleagues on American standard accounting principles is amazing. Every benefit they are talking about taking away will not go away because they are all legitimate business expenses, and they will all be expensed. Why did the Congress back in 1906 give this advantage to our oil companies? Why did they do that? Because drilling for oil is a capital-intensive business, and if we want more oil found, what we have to do is be able to generate the internal rate of return to put that capital in. So we offered accelerated writeoffs for expenses.

It is interesting that we are not going after all the oil companies or all the gas exploration; we are only going after the big five. Why is that? Because my colleagues know that if we did the same thing to the ones that are actually producing most of the gas in this country, all the new technology which the R&D tax credit and the intangible drilling costs allowed to be developed--that makes this country with 100 years' worth of natural gas--would go away, and the smaller and medium-sized oil companies will never be able to have the capital to continue to perform and raise our level of energy resources ourselves.

So what we are on the floor for is a charade. The price of oil is high because the dollar is weak. If we want to punish somebody for that, punish the Congress, punish the Federal Reserve, punish the executive branch, but don't go after somebody who is going to create 90,000 new jobs in our country this next year.

We always look for the right political moment to make somebody look bad. The people who look bad are in the Congress because we don't have the guts to stand and say we need a cogent energy policy that says we are going to go after our own resources. We are going to use every asset we have to utilize cleanly and in a friendly way the tremendous reserves we have in this country.

We know we have 160 billion barrels of recoverable oil in this country. They are not proven, but that is what the estimate is. We are the third largest oil producer in the world. We could become the second largest oil producer in the world if we had a cogent government policy and an environmental policy. We have oil out the kazoos. We are going to find more oil as we explore for more natural gas. Right now, we are only importing 47 percent--47 percent--of our oil needs. It was 65 percent less than 10 years ago. Why is that? A part of it is smaller demand because we have been in a recession, but the vast majority of it is the very technology they want to deny the fast writeoff for is what has created gas liquids that have filled the void. It is better than the best crude oil in the world. That is coming out of North Dakota, it is coming out of West Virginia, it is coming out of Oklahoma and Texas. It is great stuff, easy to refine, cheap gasoline in terms of the cost to get it from a product to a product we can use.

I am pretty well disgusted with what I am hearing on both sides of the aisle because the real problem is not the price of oil. The real problem is the price of the dollar, and if we will fix that, we will fix tons of things that will help our economy. But we are recalcitrant to the point we will not do the things we need to do.

Our government is twice the size it was 11 years ago--two times the size. No wonder we are running a $1.6 trillion deficit. No wonder we don't have an effective--we have the largest number of regulations to ever come out

of any administration in the history of the country in the first 2 years of this administration. It is killing job formation. It is causing people not to invest. It is causing a lack of economic growth in our country because we have people making decisions who have no idea what they are doing or what are the ramifications of those decisions. They are lawyers whose first creed is don't do what is best for the country, do what is safe for the bureaucracy. That is how we are running this government today.

We have 45 percent more regulations issued in the first 2 years of the Obama administration than anybody else has ever done, and we wonder why we are not getting job creation. We continue to refuse to debate on the Senate floor the very real issues in front of this country, the very real issues such as what part of government can we do without? How do we get a future for our children? The fact is, we have lived the last 30 years off the next 30 years of our kids, and that bill is due. It is not due 1 year from now; it is due now.

We are tied up in knots because we have this false indication that a debt limit means something. If a debt limit meant something, we wouldn't be raising the debt limit, we would quit borrowing. But, instead, every time we come up to the debt limit, we are asked to raise the debt limit. We will not make the hard choices of what part of government is not valuable in light of the fact that we are cutting the legs off from under our children and our grandchildren.

In this debate, we are going to hear a lot of finger-pointing about what is bad with Big Oil, what is bad with oil, what is bad with the price of gas. What is bad is, Congress isn't doing its job. We are not addressing real issues and solving the real problems in front of this country.

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