Energy

Floor Speech

ENERGY -- (Senate - July 17, 2008)

Mr. CRAIG. Mr. President, I came to the floor on June 19 to address my colleagues and the Senate about energy prices, as many of us have, because there is no question that the Senator from Colorado and I, when we go home on the weekends, hear as the No. 1 concern on the part of Coloradans or Idahoans their energy bill--the price of gas at the pump.

We are big western States. We travel long distances. When you roll into a gas station with your Ford F-150 and you start filling it up and you drive away, because it has dual tanks on it, having paid over $100 to fill it, you have a problem. You have a problem because you had bought that vehicle to facilitate your ranch or your farm or your job and you had anticipated that the most you would probably ever pay was $25 or $30 to fill up. That is what you budgeted. That is what you understood the economic impact of that vehicle, necessary to your job or your business, would be on your job or your business. But in less than a year, that changed.

That is the working man or woman's side of it. What about the soccer mom who travels around all over the community every day, dropping off her kids and going to the store and picking up goods and services and coming home and all of a sudden having an energy bill in the family budget that she and her husband had never anticipated would be there. We all know their salaries or their jobs are not going to compensate them because they are going to spend $500, $600, $1,000 or $2,000 more this year on their energy bill. That is only at pump, let alone at the meter that monitors the electricity at their home that is going to be going up; and the natural gas that is going to go through and into their heating systems and their stoves. That is going to be going up. There is no way for them, other than taking money from something else in their life, to offset that impact.

Those people such as myself who spend a good deal of time, and have for 28 years, on the issue of energy, were very fearful that a day such as today would come, a day of reckoning, a day when our country that, almost 20 years ago, decided it would no longer be a producer but because of environmental policy and political attitude, we began to change. We decided we would try to offset production with conservation and, in large part, we said to the energy-producing segment of our economy it could no longer drill in America, go elsewhere.

I will never forget meeting with the President of Amoco in Los Angeles about 15 years ago. He opined to me that the day would come when his company would have to leave this country because it could no longer produce in this country--and that is what happened. And doggone it, that is the truth. You can document it. You can see it happening. It happened. We put millions of acres off limits for one reason or another but largely because of an attitude in this country that somehow we were going to muck it up a little bit environmentally and we ought to leave it alone and it ought to be pure and it ought to be pristine. And, oh, by the way, energy is cheap. It was inexpensive at the time and we could buy it from somebody else. So basically we set the rest of the world to producing and we became increased consumers and increased buyers of foreign oil.

During that last 20-year period, something else began to happen. The oil we were consuming was no longer owned by companies we had interests in, it was owned by nations. It was owned by nations that were sometimes friendly to us, sometimes not so friendly to us, but nations that began to recognize they could gain the wealth of America by selling it oil because America no longer wanted to produce. We grew from about 35 percent dependent upon oil when I came to Congress in 1980, to, today, nearly 70 percent dependent. And those nations have us right by the gas nozzle today. They can do what they want. They are reaping our wealth at unprecedented rates--$1.2 billion a day--and they are turning around and buying back our companies and buying back our real estate with our money. But it is now under their ownership.

The greatest wealth transfer in the world is taking place as we speak, as America drains itself dry for the need of energy, and a Congress unwilling to act responsibly and having failed to act responsibly for the last 20 years. It is a dilemma unparalleled in American history.

When I came to the floor on June 19, I said there is an old country western song that says ``a little less talk and a lot more action.'' That was June 19. Now we are into mid-July. Oil prices went up nearly $15 more a barrel during that period of time and gas went from about $3.90 on average to $4.11 on the pump nationwide. Guess what. We still got a lot more talk but very little action.

Why is America angry today at their politician? Because their politician is fearful of action.

I once voted to lock up ANWR. I once voted to put off limits drilling out on the Outer Continental Shelf. It was for all my environmental friends. How do I change? How do I shift the political gears to meet the American people today who are saying simply go where the oil is, explore and develop and bring it on line. We need it desperately. It is draining our pocketbooks dry.

That is the domestic economics side. What about the national security side, when we are 70 percent dependent on foreign oil? So it is a national domestic economic issue and it is a U.S. national security issue. Guess what, folks. A lot more talk and hardly any action. So when the President stepped up a month ago and said why don't you in Congress lift the ban on Outer Continental Shelf oil drilling, I turned around and called the White House and said: Why don't you, Mr. President? You did it by Executive order a couple of years ago for the politics of Florida. Why don't you act?

He did act. He acted last week, in a responsible fashion, to lift the Executive order that limited the exploration and development in the Outer Continental Shelf. Guess what happened. Between the combination of a realization that Americans were consuming less in the summer of 2008 versus the summer of 2007--down by nearly 15 percent because they simply can't afford the oil and the gas anymore--coupled with the President saying to the marketplace, there is a potential for development and more production, the oil price began to slide. In the last few days it has dropped from $147 to $134. If it continues to do that, we might see gas prices at the pump slip 15 cents or 20 cents. But I doubt that it will unless this Congress acts.

The majority leader, the Democratic leader, came to the floor yesterday with a bill, 3268. What is it about? He says it is about speculation. What is speculation today? Is speculation the futures market that anticipates that gas may be going up so you hedge your investment against the future so you can offset the expense of new energy? Is that speculation or is that wise investment? I don't know. But I do know this, that in the legislation the Democratic leader has put up, there is not one drop of new oil in it; not one gallon of new gas in it; not one oil rig worth of new production in it.

We listened to two experts today who came to the Senate to talk about energy. They said there is no easy way out. You have to have some production, but you need conservation.

OK, look at the speculation side. Create greater transparency. Do all of those things. But it is truly a supply-and-demand market today and we are supplying less and demanding more. In this country in the last 10 years, our demand curve went up dramatically as everybody rolled out in their F-150 Ford pickups--and I don't mean to be picking on Ford Motor Company or their big SUVs--and they were getting 12 or 15 or 16 miles to the gallon and it was $2 and aren't we having fun, until it hit $4. Now they are mad and frustrated and angry and fearful of their future--and they have a right to be.

Many of us believed this day would come; we just didn't know what day on the calendar it would occur. Because the old principle of supply and demand in the marketplace, you can't divert. It happens. When you are supplying less and demanding more, it happens.

Here is a simple formula. Take every oil field in the world today that is producing, that has those big rigs on it pumping the oil--it depletes, meaning it uses up the oil in the strata that is underneath, at a rate of 4 percent to 5 percent a year. So the ability to have a field to continue to produce at the level it is begins to decline.

On top of that, the world is demanding about 1.5 percent more oil every year than it did the year before. Why? We are growing, we are buying big cars, our economy grows--but something else has happened. There is a new economy across the Pacific known as China. All of a sudden, they became consumers of oil. They begin to buy in the world marketplace.

Then there is another country further on across Asia known as India. They are consuming more and they are buying out of the same pools we are buying out of. All of a sudden the perfect marketplace storm occurred. We began to consume a great deal more than we were willing to produce. In this country we were consuming a great deal more than we were willing to produce, so the marketplace looked at it and said: Oh, we have a problem here. All of a sudden those who look at markets began to try to protect their future by buying into the future through the system--with no indication from us that we were going to do what was not politically correct, from the standpoint of our politics back home, but what was politically right for the American consumer; and that is, to get us back into the business of production.

So I am telling the majority leader, you can bring a speculation bill to the floor, but this is a Senator who will not support it and will not vote for it if it does not have production in it. We cannot talk our way out of this one, we cannot manipulate our way out of this problem. We have to produce our way out of this problem, and we have to conserve our way out of this problem.

Is it not interesting that when the world market began to discover that Americans had tightened their belts because they could no longer afford the gas at the pump and the consumption rate from last summer to this summer is down 15 to 20 percent and you have a world leader, this President, our President, stand and say: America, I am taking the limits off, in the ability of my office as President, through an Executive order, I am taking the limits off the Outer Continental Shelf, where we know there could be oil.

Some of us have said we ought to do the same thing here. Next week there will be plenty of amendments, if the majority leader allows true legislative dynamics on this floor, a bill to come up and a bill to be amended because we will add production to his lots-more-talk and little-to-no-action bill.

We will add production. If we do, and if it makes it to the President and if he signs it, I will bet you the price of oil in the world markets will begin to decline a little. Now, while that is all happening, in the next months and years, we have a lot of other work to do as a country. We have to bring on the hybrids, we have to bring on the electric cars, we have to learn to conserve in other ways.

Last year, I broke stride with the auto industry. I said: Mandatory 4 percent increase in CAFE fleet average standards. I had not done that in 28 years of my politics here. The auto companies came to me and said: Gee, why are you leaving us now?

I said: I have not changed in 28 years and neither have you.

I changed. I partnered with a Democrat, BYRON DORGAN. We set a mandatory 4-percent CAFE standard for fleet averages of automobiles in this country. It became law. When it is fully implemented, over a period of time, it is akin to bringing on an oilfield that produces 1.5 million barrels of oil a day because that is the amount that is saved.

So as a Senator who has always been a supporter of production, I also recognize there is a lot that can be saved through conservation. There is a lot that can be saved through new technology. I believe the generation ahead of us, this next 10 years in the economy, is going to be the decade of energy.

I think Americans are going to invest more and understand more about their energy and do more about their use of energy than they ever have in the decades before. Why? Because it is going to cost more. If it is going to cost more, there is probably more profit to be involved. If there is more profit to be involved, there is going to be more investment in it. But Congress, get out of the way. Quit being politically correct. Demand standards. Demand quality environmental procedure. But get out of the way, politicians. Let America produce once again. When we do, our economy will strengthen, the American families will fear less, our national security will be more assured, and we will not let the Venezuelas or the Nigerias or the Saudi Arabias or the Irans jerk us around by the gas nozzle the way they are doing now because, once again, as a great nation, we begin to stand on our own two feet.

We have arrived at that break point in the world of energy. It is time we act, responsibly, directly, and that we deal with a lot more action and a lot less talk because our Nation became a nonproducing nation today because of politics and public policy, not because the oil was no longer there.

Shame on us. Shame on the American politics of the last 10 years that denied production in this country. The American consumer, listen up: Call your Senator or call your Congressman right now and say: Pass a bill that allows us to drill.

It is quite simple. Pass a bill that allows us to drill. The futures market will decline and gas at the pump will begin to drop and the American economy will begin to stabilize. It is going to take some time, but you have to act first. So, Mr. Leader, you can bring a talking bill to the floor but allow us to make it an action bill. Allow us to make it a production bill. Americans, call your Senators and say: Allow us to drill.

It is that simple. That is how we change the world of American politics today, that for the last 20 years has denied the right of the American marketplace to produce the energy necessary to stay independent, free, and reasonable in price.

I yield the floor and I suggest the absence of a quorum.

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