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Senator Byrd

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Remarks by Senator Byrd

Delivered on April 11, 2005

Senator Byrd delivered the remarks below offering concrete steps that could be taken to help reduce the price of gasoline. His remarks came on the day that the well-respected Lundberg Survey showed gas prices soared an average 19 cents in the past three weeks due to lingering high crude oil prices, growing demand, and higher refining costs.

The people in my home state of West Virginia are frustrated and outraged with the soaring cost of gasoline which has become a never-ending, ever-worsening nightmare.

The rising cost of gasoline means that workers in West Virginia are seeing their paychecks dramatically reduced by the simple fact that they have to drive to get to work and back. It is darned difficult and expensive for a coal miner to pay $2.25 a gallon to drive his pick up truck to work on the two-lane, hilly, winding roads of West Virginia.

Noting that West Virginians have become "hawkish about watching gas prices," the Charleston Gazette pointed out that they "have few mass transportation options, travel farther to work, and often traverse [much] more rugged terrain."

The facts are clear and revealing.

According to census data:

• Although West Virginia is relatively a small state, workers in West Virginia spend more time commuting to work than the national average.
• The percentage of people in West Virginia who own a pickup is almost double the national average.
• Each licensed motorist in West Virginia drives more than 15,00 miles a year, about 400 miles more than the national average.

The point is this: Large rugged vehicles are not an expensive luxury for workers in West Virginia and in many other rural states. And, anyone who has tried to navigate the narrow, uphill climbs of West Virginia’s mountains, by weaving corners, rounding bends, constantly slowing and accelerating, and stopping and starting, know the need for these rugged vehicles, and regrettably, the cost of fueling them.

Imagine navigating that kind of terrain, not only to work, but getting children to school as well as to go to the grocery store. The frustration and the outrage of West Virginians paying $25, $30, and $45 dollars just to gas up is certainly understandable.

Family budgets, already strained by the rising cost of health insurance, college tuition, and other everyday expenses, are being stretched even thinner by these record-breaking gasoline prices in West Virginia. Students are discovering that they cannot afford to drive to school. Owners of recreational vehicles, now paying more than $200 to fill up, are rethinking and postponing summer travel plans.

West Virginia’s small businesses depend on deliveries. Floral shops, pizza parlors, produce shippers, taxi companies, construction and remodeling businesses, plumbers, electricians, landscapers, all are finding it harder to make ends meets. Many are going out of business. I recently read of an independent trucker who lives and works just across the border, in Norfolk, Virginia, telling the Christian Science Monitor that last year she paid more than $250 a week for fuel, and that was making her life as a single parent very difficult. She was even forced to decide between paying a doctor bill for her child or buying new tires for her truck. "My truck lost," she explained.

With the rising price of gasoline, a multitude of other industries, including chemical, steel, and plastics are confronting extremely difficult choices. They must charge their customers more, thus weakening their competitive edge, or lay off workers, or suffer a decline in productivity.

Today’s record-high gasoline prices in West Virginia are affecting literally everyone, from commuters, consumers, and businesses, to public and private agencies. Meals on Wheels programs are having trouble delivering meals. Local governments, already straining to pay for essential services in these days of cutbacks in federal assistance, are simply overwhelmed in their efforts to keep school buses, police cars, fire trucks, and other city and county vehicles in operation.

The damage is devastating, and it is everywhere. Even Administration representatives acknowledge this. While being interviewed by Jim Lehrer, Treasury Secretary John Snow acknowledged the economic impact of today’s huge gasoline prices. Secretary Snow explained: "The facts are pretty clear, that high energy prices, if they are sustained, will take its toll on the economy, will reduce GDP growth rates and will hurt employment, so it’s clearly a negative for the economy." Last year, polling data showed that more than half of the American people said that the rising cost of gasoline had been hard on them financially, while more than a third said it had caused them serious problems. U.S. consumer confidence fell for a third month in March, and this is being attributed to the cost of gasoline.

At one time, inflation was called the "cruelest tax." Soaring energy costs are the "ecumenical tax" as they are taxing anyone and everyone with a car or a truck -- everyone regardless of race, sex, or occupation. Low-income workers are being hit the hardest however, as they usually have to travel the farthest to work because of the need for affordable housing, they have less access to mass transportation, and they drive older, less fuel efficient vehicles. Whatever tax breaks workers in West Virginia received from the Bush Administration are being drained away at the gas pump in one way or another.

Now, as the American people cry out for help in this current crisis, they look to Washington for action. The White House’s response to this outcry has been to moan about the failure of Congress to pass its so-called energy plan and recycle old legislation.

It should be pointed out that when the American people cried out for leadership, this Administration just whined and pointed fingers. The White House is supposed to be a bully pulpit. It is supposed to be a place of leadership, a place of action. But when it comes to dealing with today’s energy mess, the White House is out of gas.

For three congresses, an energy bill has clanked about Washington. The administration’s National Energy Policy has been drafted by special interests, ironed out behind closed doors, and presented as a fait accompli for Members to support. But the National Energy Policy, in its totality, would do little to seriously address our energy needs now or in the long term. Furthermore, the Republican energy bill has proven to be another in a long line of efforts to codify backroom bargaining and underwrite the Administration’s corporate contributors.

The only major provisions that might provide tangible progress are the energy tax incentives, and only if they are developed in a targeted and robust enough manner. These incentives would encourage more conservation and efficiency as well as promote advanced technologies such as for clean coal technologies. However, I fear this too could be a mirage as the President’s proposed Fiscal Year 2006 budget only provides just $6.7 billion over the next ten years for all energy incentives. This is only about a third of what was provided two years ago in the Senate energy bill. Energy tax incentives too have become scarcer with each Congress.

Furthermore, I have already declared that the administrations energy plan was another lost opportunity to shore up our nations energy security, provide for future economic growth, and protect consumer interests.” Analysis by the Department of Energy’s own Energy Information Administration (EIA) has come to the same conclusion. An EIA review of the energy bill of the 108th Congress has clearly shown that the bill would have a negligible impact on increasing production, reducing consumption, lowing imports, or affecting energy prices. So what was this bill going to do then? When are we going to establish some clear, unequivocal goals to demonstrate progress on energy policy?

Sadly, some have now chosen to exploit the misery created by the gasoline crisis to renew their push for this partisan energy bill crafted by the energy conglomerates. When our focus should be on helping America’s drivers and workers through this energy crisis, the focus of those individuals who would push a partisan agenda is woefully misplaced.

The Administration’s budgets have continually and fully underfunded important energy resource needs, from basic research and development efforts to critical energy program management. For example, President Bush has failed to fully fund the Clean Coal Technology demonstration program. This is the very program that I started back in 1985. As a presidential candidate, George Bush promised to commit $2 billion over ten years to the Clean Coal Technology program. Yet, not one of his five budgets has fulfilled that commitment. Furthermore, this Administration actually significantly slashes funding for oil and gas research programs. How are we going to keep pace with developing and using our fossil energy resources in a cleaner and more efficient way without the necessary resources? Like its agricultural policies, the Administration’s energy policy promises the American people a rose garden. It ruminates with much rhetoric but then fails to fertilize with funding.

And then there is the proposal to open the Arctic National Wildlife Refuge (ANWR) for oil and gas drilling. This has been a very controversial issue for many decades. Regardless of how much petroleum may be available, it will take a least a decade to develop the area for production and would not provide any short-term gasoline supply relief. And, yet, some would take advantage of current sufferings at the pump to push this highly controversial measure, suggesting relief for consumers if they only set aside their objections to open this landscape for drilling.

Mr. President, I have long recognized the need for a long-term, comprehensive national energy policy. It is a plea I have made time and time again, as I have always insisted that we must both reduce our dependence on foreign oil sources and develop a fuel strategy that builds on our own domestic alternative supplies. But, despite oil embargoes, wars in the Middle East, and now skyrocketing gasoline prices, my pleas have been ignored.

While the White House has failed to propose any serious policy options, or take any action to remedy the current crisis, I am suggesting that it is time to get serious. It is time that this nation make the necessary investments so that we can reduce our dependence on foreign oil. What does this mean? It means making investments in conservation and efficiency and getting the next generation of vehicles on the road. It means investing in different fuels that can be made from domestically secure sources such as from agricultural residues and through coal gasification. It means investments in building and upgrading our refining and pipeline infrastructure in order to move our petroleum products to market.

At the end of the day, it requires that we set our sights on a goal in order to start getting off foreign oil. Last Congress, this Senate included an amendment to the energy bill that required the President to find ways to reduce our dependence on imported oil by 1 million barrels per day by 2013. It did not dictate any specific requirement but rather encouraged any and all efforts to reduce our oil dependence throughout a number of different sectors of the economy. Yet, it was stripped out in the energy conference. If we cannot even do that, how do we do it? Furthermore, a number of serious, near-term, administrative recommendations have been suggested.

For example, Senator Bingaman sent a letter to the Secretary of Energy and the Administrator of the Environmental Protection Agency in April 2004. He laid out thirteen concrete actions that the President could take to respond to high gasoline prices. I concurred with many of these recommendations in a letter to the President in May 2004.

However, has this Administration followed through on any of these suggestions?Right now, more than ever, what we need is not just long-term policies but also near-term programs and actions that address the immediate crisis as well. For one thing, as the great British economist, John Maynard Keynes reminded us, "In the long run, we are all dead."

But I am also reminded of the response that an aide to President Franklin Roosevelt gave when asked why the Administration was acting so quickly and forcefully to put people back to work, during the dark days of the Great Depression when, in the long run, market forces would eventually do it. The aide, Harry Hopkins, snapped, "People don’t eat in the long run, they eat every day."

While we do need long-term energy policies to reduce our dependency on foreign energy, we still drive cars every day. Every day, during the dark days of this gasoline crisis, American workers, American consumers, and American small businesses suffer because of the failure of their government to provide short-term solutions.

I am calling upon the White House to direct the Secretary of Energy to suspend the delivery of oil to the Strategic Petroleum Reserve until market conditions improve.

I suggest that we explore the possibility of liberalizing the vehicle depreciation tax to help people who commute more than 30 miles to work.

I am calling for at least $15.5 billion in targeted tax incentives over the next ten years, including $2 billion to deploy advanced clean-coal technologies. This package would help strengthen the economy, enhance our Nation’s energy resources, promote an array of advanced energy technologies, and increase jobs, while ensuring a healthy environment..

I am calling for investigations into what is going on -- why the people in West Virginia are getting squeezed and gouged when huge oil companies are enjoying record-breaking profits. I am calling on the White House to direct the Federal Trade Commission to review whether speculations in the futures market may be playing a role in driving up gasoline prices. I am calling for a congressional investigation to ascertain the role of oil companies in determining the price that West Virginia and other rural states workers pay at the pump.

Finally, Mr. President, I am urging the White House to stop whimping out and to confront OPEC. Press these oil-producing countries to increase oil supplies, to help stabilize global prices. While running for the presidency, George Bush promised to get tough with OPEC, especially the Saudis. He is now the President, and now is the time to do it!

This is perhaps, the biggest failure in this Administration’s do-nothing policy toward rising fuel prices -- the stubborn refusal of the White House to play hardball with our trading partners. For four long years, the value of the U.S. dollar has been devastated by weak-willed policies that work against the pocketbooks of hard-working Americans. An inconsistent dollar policy has wreaked havoc in the international oil markets.

And, what is the Administration doing about the dollar? Senator Sarbanes posed that question to Condoleezza Rice in her confirmation hearing before the Foreign Relations Committee on January 18, 2005. Dr. Rice responded: "I really think it best that I not comment on currency matters. . . . I'll be an active and interested participant, but there are some matters that I really feel are best left to the Treasury. And that's the commentary on currency."

Talk about passing the buck on the value of the buck!

But the Administration should be working not only to address the weak dollar. The White House should also work on rehabilitating its own weak, creaky spine that has kept it from playing hardball with the foreign countries that sell us most of our oil. In his book Plan of Attack, Bob Woodward reported that Saudi Arabia wanted to fine tune oil prices in the months before the 2004 presidential election.

Why not use the bully pulpit to call for increased oil production? Why not dispatch the Secretary of State to OPEC countries to twist arms and knock heads to get an increase in oil production? Why does the White House remain as silent as a stone when OPEC announces, as it did on March 30th, that it has ruled out an increase in oil production? Why does the Administration hold its tongue when Middle Eastern potentates collude to separate working Americans from their hard-earned dollars?

Instead of reading headlines about declining oil prices, we only read of scandals about Halliburton’s lucrative, billion-dollar, no-bid contracts for Iraqi oil fields. Instead of lowering prices at the pump in the U.S.A., less than eighteen months ago, the White House asked Congress to approve $900 million in taxpayer money, to send more gasoline to filling stations in Baghdad!

The President might not have a short-term energy strategy for the United States, but he has a great one for Iraq! The only problem is that the American people are paying for it twice: once on April 15th, the day our income taxes are due, and once again on every trip to the filling station.

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