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Public Statements

Economic Crisis

Floor Speech

Location: Washington, DC

ECONOMIC CRISIS -- (Senate - October 02, 2008)

Mr. CRAIG. Mr. President, for the next few minutes I wish to connect the dots. What am I saying? Well, I wish to take us from where this Senate was last night, when on a 74-to-25 vote it voted out one of the largest financial assistance packages in the history of the Nation--700-plus billion dollars--to try to stabilize the credit markets of our country and make sure that Main Street--whether it be in small-town Colorado or small-town Idaho--still have credit in its banks for its citizens and its small business people to conduct business and make payroll.

We have, by a series of actions over the last decade, placed the American economy and the American consumer--the taxpayer--in peril. Last night was an effort to recognize that and to do something about it. Because of its size, and because of its early billing--that it was a ``Wall Street bailout''--I suspect your constituents and mine backed off and said: ``Whoa, wait a minute, government; wait a minute, politician, don't put the taxpayer at peril with this kind of effort.''

At the same time, you and I, and many of us here, were looking at all of the issues at hand, recognizing this was not a bailout for Wall Street. In fact, from its original concept to its evolution to the bill that was passed last night, it was a much different document--safeguarding and protecting the taxpayer and trying to recognize the need of a growing credit crisis on Main Street USA. I think, and I hope, we have accomplished that.

But how did this come to be? Well, there are a lot of fingers that can be pointed. We can point at the liberal lending policy and advocacy of Fannie Mae and Freddie Mac, and subprimes, and too much credit in the market, and the explosion of the housing industry--or at least the explosion of the bubble in the housing industry. But something else came along about the time all of those elements in our economy were coming together that I think was probably the tripwire that helped create the current situation.

Let me connect the dot, the dot of too much credit, of subprime, of an economy that was maxed out, of a consumer who was maxed out. Let me connect the dot of the average consumer having to pay anywhere from $100 to $150 more a month on his energy bill at the gas pump. What happened in our economy as energy prices went through the roof and that spread out across our economy in food costs, in transportation costs, in the costs of everything we do because our economy is so intricately linked with energy and the availability of energy? You didn't hear anybody on the floor last night talk about energy. You did not hear anybody on the floor last night talk about the $4 gas or the $140-a-barrel oil that was true a few months ago, but it was there and it was lurking in the background. It had already hit our economy along the side of the head with a fatal blow. We have over the last several years tried to recognize that.

When we left here in July for the August recess, Democrats and Republicans were at odds over energy. I was saying let's drill, let's produce, and the American consumer was awakening to this energy shock that our economy was having and they were saying the same thing; 65 to 70 percent of the American consumers were saying, What's wrong, politician? Why are you locking away the great resources of this country? In the name of the environment? In the name of no growth? In the name of good feelings? The bad feelings were at the pump. The bad feelings were in the pocketbook.

Stay with me for a moment and think about this. Think about that consumer. He and she, working hard, maybe bringing home $45,000 or $50,000 a year amongst the two--mom and dad--they have their credit cards maxed out. They have maybe $5,000 on their credit cards and they are paying a couple of hundred dollars a month each month on that credit card and making their house payment and barely getting by and, all of a sudden, in the last year and a half or two, their energy bill goes through the roof and they are paying $150 to $200 a month, and they don't have it.

Then the value they had in their house that they might have taken a second mortgage out on to bail them out, all of a sudden begins to disappear. That is an American family in crisis. That is an American family in crisis without question. That is the crisis we began to deal with last night. That, of course, was that $5,000 they had on their credit card that they were paying $200 a month on, the credit card company called them up and said we are going to pump it up to $400 a month, we are going to drop your credit line, and we are going to charge you more interest. That is what was happening, and it was brought on by practices in the economy over the last good number of years, and the energy crisis coming down on top.

In the midst of all of this great debate about the economy, something happened at the end of September. Politicians who couldn't face the vote to deal with the issue of taking off the offshore oil moratorium let it expire. There were a few stories about ``offshore drilling moratoria expired.'' Even some of the cable news stations had charts up showing graphs--graphs I had used here on the floor--of areas that were now available offshore. Somehow there was a little story out there that possibly we were going to get back into the business of drilling and production and therefore bring down our risk as a nation and stop the huge flow of money going offshore and the consumer would be better off.

I am here today to connect another dot and to suggest to the American consumer that is an illusion. The reason it is an illusion is because there are a few politicians around here saying when we get back next year, we can slip that moratorium back on. There are others saying good, it is off, it will stay off, and we can begin to work the process of getting the Department of the Interior, USGS, and others to do the surveys and environmental impact statements that will allow us to drill.

Therein lies the question: To drill--when? Let me tell you how it works, because the day the moratoria came off, and they came off the last of September, if everything were to work right, it would be 7 to 8 years before any rig could go out there into the deep waters and begin to drill. That is normal process and time. If you look at the example of Alaska where there are offshore leases and the environmental impact statements have been done, guess what else happened. Along came the interest groups and they filed suits and they have extended that drilling time out another 3 or 4 years while the oil companies go through the courts and fight the battles of the environmental groups that do not want you there to begin with.

America, please awaken. Do not think the energy crisis is over because we have turned the economy down, we have turned consumption down around the world and all of a sudden oil is now down to $92, $93, $94 a barrel. Because the very thing we hope for, and that is for the economy to come back and people to come back to work and homes to be built here and around the world, means that energy consumption will go back up against a relatively static supply market.

The good news is we hopefully did the right things to bring the economy back. The bad news is we haven't done a darned thing to increase the supply of hydrocarbons in our market--except to run a few tickertapes or billboards that we let the moratorium expire on offshore oil. But we have not indemnified the companies, we have not done the right things it would take to bring drilling to the areas where the oil is. And there is oil out there--billions of barrels of oil.

Every time the gulf, where there is a lot of deepwater drilling, gets hit by hurricane--whether it was Katrina or Ike recently, that knocked hundreds of platforms off their foundations out in the deepwater production area--there was no environmental problem because we are so good at doing what we do today. We insist that the best talent come, the best equipment come, and we have those kinds of environmental protections that deny us the ghosts of Santa Barbara of three decades ago. Yet there is still a large number of Americans wanting to deny us that. There is a great number of politicians who would love to run from the reality of getting this country back into the business of producing energy.

We talk about it. We play the game. But I am here today to say we do not connect all of the dots and it is not going to be 2, 3, 4 years after the moratoria goes off. After you work all the systems and all the lawsuits through all the courts, you would be very lucky to get any field into production in the next 12 years. That is the way it is. That is the problem we have to deal with. That is the problem the new Congress will have to deal with and deal with it in a very real way.

What are we talking about? The estimation of the domestic recoverable oil and gas resources in the Outer Continental Shelf. In old geology, in old surveys that do not keep up with the modern techniques that we have today, where we are finding the truly deep oil out in the gulf, we know there are at least 30 billion barrels of oil. We believe in the undiscovered resource areas there could be as much as 85 or 100 billion barrels of oil. There are literally trillions of cubic feet of gas--200, 250, 350, 400, we are not sure, but we know this. When you take the old technology and you go out there with the new technologies and you apply it to the old geologies, you usually get two to three times more than you thought you were going to get. That is a fact and we know that today.

Therefore, it is critically important that we get the rigs into the water, get the rigs out there, and begin to explore and develop; that is, if you do not want another runup in energy values and an energy crisis of the kind we have put our people through when this economy comes back--and it will come back, hopefully soon, but within the next couple of years. Congress's failure to act, Congress's willingness to march down the old path of no exploration, no drilling, no production, buy it from our enemies, the ``send our money offshore'' syndrome will plunge us back into another energy crisis.

I say to those who might be listening today, connect the dots. One of those dots you will connect is with your politicians, with your policymakers. Insist that they do the right thing, and the right thing is to free this country up and get us back into the business of production.

While the OCS moratorium has lifted, here is another little problem. A couple of years ago, with a political compromise here on the floor of the Senate, we took a little piece off the Florida coast, down off the Alabama coast, called lease sale 181. The reason we opened that was because it was very close to the infrastructure--meaning the pipes and the refinery areas. We know there is a lot of gas and oil there. We created special conditions. We even indemnified, or protected from lawsuits, some of the companies going in there. Those sales are let and those companies are headed there. We believe there could be several billion barrels of oil there.

But, very quietly, in the language it also prohibits us from going on east toward the Florida coast where there are billions more barrels of oil that were once under the OCS moratorium but have special language and special protection and still have that special language and still have that special protection, even with the moratoria expiration being lifted this past week.

That is another dirty little secret that nobody wants to talk about--the Floridians most assuredly don't want to talk about--even though in Florida today they are saying drill it, go after it, get it, help us out; drop our energy bills, help our pocketbooks, help our family budget. Congress, do the right thing.

Those are some of the challenges the new Congress will face. We have a staggering economy, we are in a major credit crunch, we have consumers who are maxed out in a lot of ways, but the one thing they grew so very angry about the last 6 months was that somebody was robbing them blind--or at least they thought they were--at the fuel pump. The reason we had an energy crisis was because we began to have a political crisis on the floor of this Senate years ago when we continually locked up our resources, all in the name of some worthy cause, denying the riches of our country and our land to the American people.

As some know who have been listening or have been watching the floor for the last hour, I am not going to be here. I am retiring. I spent a lot of my years dealing with the very issue I am talking about now, all in the name of increased production, fighting unbelievable odds because of the beliefs
many of our Members of Congress have about locking it up in the name of something.

I would hope Congress got real and recognized the reality of the world we live in. Just as we live in a worldwide economic market, we also live in a worldwide energy market. The great tragedy of today has created, in part, the economic crisis we are in. While it was at the gas pump for the average citizen every day, at least when oil was $140 a barrel, we were sending upwards of $1.2 billion offshore to buy oil.

America cannot continue to do that and remain a wealthy and prosperous nation. We simply are draining our Treasury dry. Yet we have oil all around us. Consumers are now seeing ads on television talking about the great shale pools of natural gas the new technology is bringing. Yet very quietly we are trying to keep a lot of that out of reach, all in the name of the environment.

We have all other kinds of energy resources we ought to be going after and developing. I believe the next decade in front of us is the decade of energy. I think as a Congress we are awakening. I know the consumers have awakened and they are going to demand that Congress do what is right, all in the name of new production, new technologies, diverse kinds of energy portfolios for our country.

We will not be a wealthy nation 20 years from now. We will not be a nation that allows our citizens and our young people to pursue the American dream as we and our parents before us and our grandparents before them.

We need to recognize the next 20 years ought to be and must be dedicated to the production of energy; all forms, clean, diverse. That is our challenge. So let's connect the dots.

Last night we talked about a credit crunch and a credit crisis. I believe it was worsened by an energy crunch and an energy crisis we have lived through and are currently continuing to live through.

If the Congress does not bring that together, then we will fail, or at least we will not allow the greatest hope and the greatest expectation of our country, this great country, to see its natural level. Those are our challenges.

Bold votes last night, bold and necessary steps were taken. Can this Senate as a policymaking body be as bold in energy as we were with the economy? That is the challenge we face. I will not face it anymore. But everybody who serves here will. I hope they can meet that challenge. Because if they fail, then our great Nation is weakened and the opportunities many of us have worked for, for our children and our grandchildren over the years, simply cannot be realized.

So Senate, Congress, connect the dots. Work at getting the economy right, work at getting energy production back online, work at giving this great enterprising country of ours the opportunity to create and to be what it can be. That is a necessary and important challenge. I am confident, if the citizens of our country demand it, the Congress will rise to that occasion.

I yield the floor.

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