tv Today in Washington CSPAN May 18, 2011 6:00am-7:00am EDT
it does not solve the problem or the pain that americans are feeling at the pump. and, unfortunately, this strategy too often ends up being a job-killing strategy as well. but when high gas prices are in the news, when people around kitchen tables all over america are complaining about the loss of their discretionary income, the fact they're having to cut corners so they can drive their kids to school or they can drive to work, finally we hear -- have a new speech and a new announcement from the administration, but very little when it comes to a coherent energy strategy. another mixed message is that the administration at times have suggested that we have actually overproduced domestic energy. and you may ask, how could that be possible? how could it be possible that we are producing too much oil and gas here at home when we have to
import 60% of what we use from abroad? well, the congressional research service that we depend on -- the arm of the library of congress -- has documented that america's recoverable resources are far larger than those of saudi arabia, china, and canada combined. we have more here at home than saudi arabia, china, and canada. and america's recoverable oil, natural gas, and coal endowment is the largest on earth. and we've learned in the last couple of years that america has more shale gas from previously unrecoverable reserves, thanks to new technology, horizontal trill drilling and the like. we've got enough natural gas to last us 100 years here in the united states. but compare that -- really, that gift we've been given of domestic energy at home with what the administration said
just in 2010. the treasury department issues an interpretation or explanation of the administration's policies when it talks about energy production, and this is what the treasury department said in 2009 or 2010. the treasury department -- this is secretary geithner, appointed by the president, confirmed by the senate. but the treasury department said, to the extent the tax credit -- the tax credits we're talking about here -- encourage overproduction of oil and gas, it is detrimental to long-term energy security. so the treasury department, president obama's treasury department, are making the extraordinary claim that i have not heard any senator make here because it is so implausible, that these tax provisions encourage overproduction of oil and gas right here in the united states. if we are overproducing oil and gas in the united states, why is
the administration telling existing lease holders they have to use or lose the leases that we have? it is an ideological fixation that says we have to discourage production of oil and gas even though about 80% of our energy needs are -- come from fossil fuels, because we prefer alternative forms of energy. well, i do, too. you know, solar panels, wind, biodiesel -- these alternative sources of energy are important, but we simply don't have enough of them to keep our economy moving and to remain -- and keep prices low for our domestic production, our domestic consumers, i should say. well, another part of this mixed message is our dependency on imported oil. on march 30, 2011, president obama was called -- called for reducing foreign imports by a third. but then he went to brazil recently when he told the people
of brazil that he encouraged offshore drilling in brazil. and he said that america wanted to be brazil's best customer. in other words, other than producing what we have been given by the good lord right here in america, american production, american jobs, he wants us to be brazil's best customer by importing energy from abroad. well, part of the vote that we'll be having at 6:15 or so tonight is another part of the mixed messages that we have been getting when it comes to energy. this is the so-called close big oil tax loopholes act. now, we know why the senators who introduced this bill have dodge so: because they've been getting so much heat back home because of high gas prices, their constituents are demanding that they do something. but what we are proposing to do has nothing to do with bringing down the price of gas at the
pump. in fact, it will likely increase the price of gas at the pump. in fact, the chairman of the finance committee on which i sit, he said, you know, this is not going to change the price at the gasoline pump. that's not the issue. i don't see that as an issue at all. the senior senator from new york said this was never intended to talk about lowering prices. the majority leader himself said, it's not a question of gas prices. its a a question of fairness and priorities. well, madam president, if gasoline prices being paid by americans all across this country aren't the priority, and if jobs that are created and sustained by producing domestic oil and gas right here in america aren't the priority, my colleagues who are proposing this legislation have the wrong
priority. well now we're told they've got a new idea. the money that we supposedly save from these tax provisions will be used to pay down the deficit. but the truth is, the amount of money that would go to -- quote -- "pay down the deficit" -- even if our friends across the aisle had a conversion and decided that that was their priority rather than spending 43 cents on every dollar in borrowed money, borrowed from our kids and grandkids, and bought by the chinese it would only be a drop in the bucket in the $1.5 trillion deficit that we're spearnsing this year and the -- that we're experiencing this year and the $14 trillion national debt that we're going 0 have to reckon with in the next couple of months. if the deficit -- if deficit reduction is the priority, i submit the very best way we could do that is to pass a balanced budget amendment to the united states constitution.
but that's not the priority of the majority leader or of the majority, or of our friends across the aisle. so if the rationale is not to reduce gasoline prices, if the rationale to this bill is not to produce a balanced budget, then what is it? what is it? well, the majority leader suggested it was fairness. fairness. well, the chamber of commerce, united states chamber of commerce calls it punitive taxation, picking out five taxpayers in america saying we're going to raise your taxes and leave everybody else's the same is discriminatory and it is punitive. but it also, in the immortal words of rahm emanuel, former white house chief of staff, now the mayor of chicago, i guess it never let's -- it's a case of never letting a crisis go to waste to, advance another
ideological agenda. but the truth is we know that our tax code is already biased against u.s. domestic energy producers. and if your goal is to tax people who are making money in america, this chart demonstrates that the oil and gas industry is down the list of industry sectors that are making far more money. the tobacco and beverage industry, the pharmaceutical industry, the computer equipment industry, the chemical industry, the electrical equipment industry, the manufacturing industry, the apparel industry, the machinery sector. all of those come well ahead of the oil and gas sector when it comes to making money. but you know, i didn't think making money was a crime in america. i thought we still believed in the free enterprise system and the very people that our friends across the aisle are going to be punishing are the retirees and the pension holders, the people
who own stock in these oil and gas companies that are going to be forced to pay higher prices and ultimately be passed along to the consumer, i believe, in higher energy costs. the other revealing thing about this debate is they want to punish people who produce american energy right here at home, and they're going to leave opec and these other countries to pay lower effective relative rates. so if you raise taxes on american producers and you don't do anything to similarly raise taxes on their competition, what's going to happen? what's going to happen to the saudi arabian oil company? what's going to happen to the iraq national oil company, the kuwait petroleum company, the state-owned oil company of venezuela and the like? these are places where we end up buying oil because we don't produce it at home, and we're going to raise taxes on the people who produce it at home,
and to make it in effect cheaper on domestic energy producers to produce it and sell it to us. it makes absolutely no sense. it's punitive. it's discriminatory, and it's not going to solve the problem that most america is complaining about today, which is high gasoline prices. in fact, it will make it worse. but if my colleagues want to talk about fairness, let's talk about fairness to the 9.2 million people who are employed in the oil and gas sector in america. now, i've witnessed the people who work in this sector in my state. in march, i visited a brand-new drilling rig that's using the very latest technology to produce natural gas from the hainesville shale in east texas. this is an amazing technology that goes down thousands of feet and drills horizontally and uses high-pressure fluids to fracture this shale, in effect a rock, to get natural gas out of it.
down in the gulf of mexico after the moratorium was issued, i stood on a deepwater drilling platform that was left idle because -- the presiding officer: the senator has used 15 minutes. corn madam president, i'd ask for -- mr. cornyn: madam president, i'd ask for two more minutes. the presiding officer: without objection. mr. cornyn: i could go on about the impact on job creation in my state and across america, but if in fact our colleagues are interested in tax reform, if they really are concerned that the tax code is unfair and some people don't pay enough and others pay too much, i would just ask them to consider the fact that according to the congressional research service, 77.9% of our primary energy production in america is fossil fuel sources and that federal tax support targeted energy in 2009, 12.6% went to fossil fuels. 12.6% of those federal tax supports went to people who
produce oil and gas. conversely, 10.6%, the congressional research service tells us, of primary source energy was produced using renewable sources. yet the federal tax support targeted to renewable sources of energy was 77.4%. so why are we picking on american oil and gas production, forcing us -- well, actually hurting job creation at a time when unemployment is unacceptably high, forcing us to rely on imported energy and actually rewarding our foreign competitors who will not have to pay higher prices. and when in fact, even as our friends across the aisle acknowledge at the very best, this won't bring down the prices tufrpl, they say that -- prices at the pump, they say that's not the point. if that's not the point, the point appears to be a game of
got kh* ha and -- got cha and this finger pointing we've seen inside the beltway. i think the american people are sick and tired of this game playing when in fact they sent us here to solve real problems. if we could find a way instead of this game playing, instead of this phony game of got cha to try to work together to solve real problems to increase domestic supply which would bring down prices at the pump as the president acknowledged when he said we have to look at domestic production i think we could reward them in terms of appreciation, appreciation in terms of jobs being created here. madam president, i yield the floor. mr. rockefeller: madam president? the presiding officer: the senator from west virginia. mr. rockefeller: madam president, to me, this argument is in fact all about
fairness. it has nothing to do with class warfare. it has nothing to do with got' cha but has to do with abgrow tkpwaeugs of social responsibility -- abrogation of social responsibility on the basis of levels. every once in a while we have a debate here in the senate or senate committee that is revealing and stunning all at once. recently i had one of those moments when i had the opportunity to ask some questions to guess what? five executives from the largest oil and gas companies in the country. not linking price of gas, but in the people's minds it is, with the gas prices head up $4 a gallon, many people spending close to $100 a week to gas up their car, i was cautiously optimistic that we would have in this senate finance committee hearing a real dialogue on the
idea that everybody had a shared responsibility and that you share your responsibility, in this case for the need of balancing the budget, coming closer to it, and then from that you then can share prosperity. but you've got to share responsibility first because that's what leads to the discipline that allows prosperity generally in this country to get ahead. i thought that the oil executives might at least veal a bit of -- might at least reveal a bit of discomfort on their part about how gas prices are standing like a dead weight on our economy, about the fact that they make so incredibly much, inexplicably, unexplainably much money, especially when they together earned just about $35.8 billion in profits in the first three months of this year.
how wrong i was. they were eager only to defend the way big oil does business, defend the enormous salaries, defend the business model that puts control of gas supply in the hands of a few. one wouldn't even answer, when he was asked about his company's claim that trying to reduce taxpayer subsidies which is what we want to do given to this industry would be un-american. he said that a number of times in that exchange. it wasn't very fruitful, but it was insightful. as i said then, put simply, these men are all completely out of touch, deeply, profoundly out of touch with what the rest of the country is going through. and that's, again, what it's about. fairness. do you know other people are suffering? your situation is this. very profitable. other people are going on very
hard times. and isn't there some way, in this case $2 billion a year out of -- instead of making $125 billion a year profit -- not just, you know, more money, but actually out of profit, $125 billion would go down to $123 billion. would not hear of it. would not hear of it. they are so caught up in their profits that they have lost sight of what is happening in mainstream, new hampshire, in mainstream, west virginia, across our economy, our schools, on main street and around the kitchen table. well, gentlemen -- the five -- here's some of what you need to know. for starters, the congress is in the midst of a full-throated debate about how to reduce our growing deficit without breaking the backs further of working families or leaving our seniors out in the cold. literally. or reducing our support for the veterans who serve our country,
and children who just happen to be our future. we are debating proposals to cut back social security and the promise that we made to generations who have worked and want to live their final years with dignity. we're debating legislation that forces medicare to be privatized, how it costs about each senior citizen about $6,000 more per year. i hope they know that. medicare privatized, chopped up, made an optional grant program run by states to drastically scale back. the congress is debating deep cuts to federal programs ranging from highways and airports to medical research to coal mine safety inspections and money for schools. everything, everything. quite simply, we're talking about making drastic cuts to programs that touch the lives of
virtually every single person in this country, except for them. and the slick executives seem blind to the real-world consequences of having made almost $1 trillion in profits during the past decade. profits. and while collecting $4 billion a year in subsidies courtesy of the very same u.s. taxpayers who i've just been talking about, the same taxpayers that were also forceed to pay at the pump and whose lives are being changed dramatically because of their position. why them? because they're a symbol. they are the top of the heap. they always prevail. they always win. they always have the lobbyists, the campaign contributions. they always can get what they want. everybody always caves to them because they're so big as they fly around in their shiny jets.
i don't think it's going to be that way this time, madam president. and the same oil executives who blanche if anyone questions their megasalaries. speaking of salaries, it might be interesting to know that the c.e.o. of exxonmobil is paid $29 million a year. i'm just trying to think of new hampshire, the presiding officer's state of new hampshire, i wonder how many people make $29 million a year just in salaries. i don't know if that includes stock options or not. during my conversation with these executives last week, we talked a little bit about how the effective tax rate on their profits is significantly lower than what average workers make in my home state of west virginia and in the presiding officer's home state. exxon paid a 17% effective tax rate over the past three years. 17%. while the average individual in
my state and the presiding officer's state paid an effective rate of 20%. now, is that class warfare? is that got ' cha or is that about fairness, about people doing something to help their country when the country is almost on its knees? the effective rate, to explain, is the amount of tax that you're actually paying on income earned when factoring in deductions and credits. it is a vast understatement to say that west virginia, like many others all across the nation, are not having an easy time during this period of record oil company profits, and they -- those five -- understand perfectly well that there is no longer any justification for maintaining generous subsidies for this highly profitable industry. the public appears to feel that way. the poll numbers are just
stunning. 70-30, it's not right, we should take away the subsidies. it varies according to poll, but it's always high up. including 2-1 republicans across the country who believe they should not be able to have those tax subsidies that we are so easily giving them. they know that without a willingness to sta re- down sacred cows like corporate subsidies, not just with them but with others, we won't ever be able to make progress in eliminating the massive federal deficit which is staring us in the face. why wouldn't they care about that? so easy for them. it's called sharing, being fair. no, doesn't work that way. the average west virginian, again, makes $32,000 a year. they can't afford another ten years of handouts to big oil. the current high gas prices are
like a dark cloud. the working class and rural states like mine commute 25 miles or more each way every day. and high gas prices can eat heavily into their weekly paycheck and, of course, they do. things are much worse in the summer, of course, when people travel, if they can any longer afford to. i hear often from constituents who are experiencing sticker shock at the pump, police departments, schools, hospitals, community organizations feel the pinch of rising fuel costs and the pinch of everything else that isn't coming through. philanthropy is down, depressed economy. it's bad. even the smallest increase can have a serious impact on family budgets and a business's bomb tom line. -- bottom line. i do not mean to suggest that the oil industry profits and subsidies are the sole culprit for rising gas prices. that is correct.
because taking what people say who are industry experts and economists too has convinced me that the big factor in rising costs of energy is the role of the speculators and i won't get into that much now. but i will say that these speculative investors make a quick profit in betting on what the cost of a barrel of oil might be next friday. and if they turn out to be right, they get a whole lot of money. i mean, it's -- it's -- it's stupid. it's wall street at its dumbest and they've shown us several ways to be that way. they take no risks themselves. i'm not alone in thinking these speculators are driving up oil prices and creating more price volatility. i've joined with other senate colleagues in asking the federal trade commission to look closely at the role of speculators in the oil futures market and in pressing the commodity futures trading commission to get moving on a power that they already have, which is to set margins on
what speculators can make, crack down, rein this in. ultimately what's needed in the big oil industry is a sense of fairness. not too much to ask. when it comes to paying taxes, when it comes to paying the price for gas, to me fairness has always meant shared sacrifice in tough times and shared success in good times. the -- it's the sense of giving something for the larger good, not stopping to be competitiv competitive -- that's not being competitive or aggressive or even profitable, but at least to show for a minute that they see where we are today. if they had expressed concern about average people and then refused to take any decrease in their tax subsidies by -- paid for by these people that i'm talking about, that wouldn't
have given me much comfort but at least it would have been just a bit of a bend. we got none of that. we like our business model. we're staying with it. don't punish us for being profitable. we do business the way we do business. we've been doing it for 130 years and that's that. so what's needed here is a reminder that a lifetime of always beating their adversaries, of never losing or giving anything of themselves to the greater good does not, in fact, lead to a prosperous cost or morally just society. that's not too much to ask, especially of big oil, and i'm not going to stop just because they don't get it yet. i thank the presiding officer and yield the floor. mr. barrasso: madam president? the presiding officer: the senator from wyoming. mr. barrasso: thank you, madam president. madam president, across this country, americans are feeling the pain at the pump. gas prices are approaching $4 a
gallon. families are going to spend on average about $800 more on gas this year than they did last year. unrest in the middle east and a weak dollar is driving oil prices even higher. now more than ever we must produce more american energy. we need to do this to reduce our dependence on foreign oil. and americans are looking to washington for leadership. madam president, all you have to do is pick up today's "usa today" to know how much. and i know you hear about it too when you're at home on the weekends -- how much this $4-a-gallon gas is impacting people in our states. "poll: gas prices hurting many. $4 a gallon requires cutbacks." let me just read to you, madam president, "as gas prices hover nearly $4 a gallon, nearly
7 in 10 americans" -- nearly 7 in 10 americans -- "say the high cost of fuel is causing financial hardship for their families." this is a new "usa today"/gallup poll. more than half -- more than half -- "say that they have made major changes to compensate from the higher prices, ranging from shorter trips to cutting back on vacation travel." it goes on, "for 21%, the impact is so dramatic," they say, "that their standard of living is jeopardized." so here we have families all across the country, in your state as well as in mine, families who are dealing with kids, bills, a mortgage and this sort of increase, $800 out of their ability to pay for other things this year, clearly impacts their quality of life.
well, americans want answers and they deserve answers. they want to know, how am i going to pay my gas bill? well, when we have american energy, energy right here in this country, they say, why are we so dependent on foreign countries for our energy? they want to know, where is the leadership in washington. well, this very we're, the president has finally, finally said that he understands the need to produce more american energy. well, you know, he's used that same line many times before. the actions of the democratic party today on the floor of the united states senate do not track with the lines coming out of the white house. the administration wants americans to believe that the administration has seen the light. but, you know, republican representative doc hastings, member of the house of representatives, has already called their bluff. representative hastings is the sponsor of legislation that
would allow more energy production, more energy production off the coast of alaska. and he said that it is -- quote -- "ironic," he said, "that the white house is now supporting this idea." he said because the white house just recently opposed the idea when he introduced it in the house ohouse of representatives. now, you know, the associated press was even more direct. they said that all of the administration's ideas had come -- all of the administration's ideas had come from three bills that were passed by the republican-controlled house down the hall. and the associated press said that the white house had opposed every single one of these bills. so despite acting against the production of more american energy just a week ago, the president now wants us to believe that he supports it just because this week he says so.
well, i hope that his change of heart is sincere because i -- but i have my doubts. because unlike energy, talk is cheap. madam president, the administration is trying to use this sudden change of heart as a bargaining chip to pass legislation that is brought up by liberals in the senate this past week. unlike increased production, the bill on the floor now by the democrats will not help the american people. in fact, the bill is clear evidence that the democratic party has no plan -- no plan -- to address high gasoline prices. why? well, the solution that we hear for high gas prices is a tax increase. since when did raising taxes lower the price of gasoline? since when does raising taxes on one thing ever lower the price of that thing? to me this is just another distraction.
now, the -- the nonpartisan congressional research service has already told us that there are some commonsense facts about energy taxes. they've told us that raising energy taxes will not lower the price at the pump. in fact, the congressional research service says that increasing energy taxes will increase the price of gas and increase our dependence on foreign oil. this administration has consistently pushed policies that actually make the pain at the pump worse. you know, instead of supporting the all of the above energy production across our country, they've been more focused on excuses about why we shouldn't use more american energy. you know, if you look back over time, there is a clear pattern. in 2008, when he was a candidate for president, then-senator
obama said that high gas prices weren't a problem. he said, the only problem is that they went up too fast. interior secretary sal gla when he was a member of this body -- interior secretary salazar, said when he was a member of this body, that you would not support more offshore drilling, he said, even if gas prices hit $10 a gallon. even secretary steven chu, who's the energy secretary, was quoted that same year as saying, "we have to figure out how to boost the price of gasoline," he said, "to the levels of europe." gas prices in europe routinely hit $8 a gallon. well, with these sorts of individuals in charge of our energy policy, it's no wonder that prices are way up, up over a dollar from where they were a year ago. this administration's shutting down of drilling in the gulf of mexico is going to drive american oil production down by 20% in 2012.
you know, even former president bill clinton called the continuous shutdown ridiculous. and to make matters worse, president obama appears to be more enthusiastic about importing oil from other countries than he is in terms of using our own. you know, brazil has discovered huge reserves of shale oil and the president recently visited brazil. and he said he wants the united states to be brazil's best customer for oil. well, when it comes to oil consumption generally, the president's story continues to change. a few weeks ago, president obama tried to make the case that americans should decrease their consumption of oil. he said -- he said, you know, we've only got about 2% to 3% of the world's oil reserves and we use 25% of the world's oil. well, according to the president's measurements, the united states has about 28 billion barrels of oil.
but according to the congressional research service, the united states actually has 163 billion barrels of oil. that's over five times as much as the president says we have. and the united states is currently the third largest oil-producing nation in the world. president obama has also said that he wants to cut imports of foreign oil by a third. well, his new proposal is definitely a step in the right direction, so why would he tie it to a bill, this bill that makes american production harder and more expensive? you know, another of the president's goals is to make alternative energy the cheapest form of energy. he continues to talk about that. and i applaud that goal. but we need to make energy as clean as we can, as fast as we can do do it in ways that don't raise the prices for american families. well, regrettably, the president's method has been to
make everything but alternative energy more expensive. and the bill his party is pushing right now is another step in that direction. so the evidence is clear. the liberal energy strategy is not creating american jobs. no, it's not creating jobs here in america. it's not reducing the cost of gasoline in america. and it's not strengthening americans' national security. instead, americans are paying more at the pump. they're living with high unemployment and they are producing less american energy. well, i hope the president will follow up on his promise to help america produce more oil. i also hope he'll stop pushing the damaging legislation that his party has put forward here this week. you know, it's time we have a true bipartisan approach on energy. senator manchin of west virginia and i have introduced just such
a bill. it's a bipartisan bill. it's called "the american alternative fuels act." this bill truly would ease americans' pain at the pump. it would repeal barriers to alternative fuels so that american energy can thrive. it would promote the production of alternative fuels derived from american sources. this bill acknowledges the truth about our energy crisis. we need more american energy, we need it all well, in addition to the green jobs that the president keeps talking about, we need red, white and blue energy and red, white, and blue energy jobs. we must keep focusing on making our energy as clean as we can, as fast as we can and do it in ways that do not increase the costs on american families. the only way that americans can
take the president's call for more energy production seriously is if he and the democrat leadership abandon their fixation on raising taxes on producing american energy. that is the first step we need to do in helping relieve pain at the pump. mr. president, i yldieieieieieis consent that the quorum call be lifted. the presiding officer: without objection. mrs. hutchison: mr. president, i rise to speak in opposition to the menendez proposal which would raise taxes on a handful of our nation's energy producers. mr. president, this bill makes the assumption that raising taxes on the five major oil companies will somehow reduce the deficit and lower the price at the pump. this is misguided, and it will also have the opposite effect. raising taxes on our domestic oil industry will drive up gasoline prices, and who in
america that is driving a truck or a car doesn't realize that gasoline prices are already very high? secondly, it will threaten the jobs, nine million jobs depend on drilling exploration and operating in america. if we drive these countries overseas, it will increase foreign imports and it will stop the jobs that are being created in america. those who threaten to repeal these deductions fail to recognize the tremendous costs and risks that go into exploring for the energy needed to drive our country forward. mr. president, our oil and gas industry is an industry, a business that creates jobs like any other industry or business in our country.
why would we single out one sector of our economy and say you can't deduct your expenses? every other business in america can deduct expenses. other manufacturing businesses in america can get the taxes that are credited for manufacturing jobs because we want to keep jobs in america, and it offsets the very high corporate tax rate that we have in our country that the president has recognized as being too high, because we want to keep manufacturing jobs, there is a credit for manufacturing. but we're going to take that away if the menendez bill passes and send those jobs overseas. we are making it so hard to create our own natural resources from our own people working in
this country, and we're sending them overseas at a time when we ought to be wanting to create jobs, we ought to be giving every possible fair break to companies that will hire in america. and yet, now we're going to take one sector of the industry and tax them differently from every other sector since. since business started in our country, we have had tax deductions for expenses, and yet here we are trying to say that we're going to take one sector of the industry and maybe they're doing too well right now, and so we're going to tax them more. well, look out other industries that happen to be successful right now, whether you're making kleenex or computers, you're going to be taxed. if you earn too much, is that really what america wants to change as our business policy,
which is -- which has a foundation of fairness and equity. we have a corporate tax rate that is so high that it encourages businesses to go overseas. now we're going to single out one industry that wants to do work in america, that wants to bring our natural resources out of the ground and bring down the price at the pump, but no, we're going to add taxes so that we will not see any lowering of gasoline prices at the pump, we're going to increase it. if we increase the cost of doing business and we force these companies to go overseas to get a fair and stable regulatory environment, then we're going to pay more at the pump, no doubt about it. now, senator landrieu and i introduced bipartisan legislation earlier this year called senate bill 516, the
lease extension and secure act of 2011, known as the lease act. it restores time lost as a result of the offshore moratoria by extending the impacted leases by one year. it is fair and it is simple. now, over the weekend, the president stated that he would be extending leases in the gulf of mexico that were affected by the moratorium, but he wasn't clear about which ones. he didn't say i will extend every lease that went through the processes to get the environmental and the safety restrictions in place. they got the lease. then they had a moratorium, so now they're paying people. they are continuing to have all of the expenses of the lease, but they don't get to do the exploration. what we're trying to do is say
whether you were in the exploration phase or in the drilling phase, it doesn't matter. if you are impacted by a moratorium on a lease that you're still paying for and you're still paying people to try to keep people on the payroll, your lease will be extended for one year. that's all senator landrieu and i do. the secretary of the interior at a hearing this morning in the senate said that they were looking into extending gulf of mexico wells directly impacted by the moratorium, meaning only those leaseholders which have already performed all seismic tests and were conducting exploration drilling. this will only cover 33 leases out of thousands that are still affected by the moratorium, because they are in the exploratory phase, not the exploratory drilling phase. this year alone, over 350 leases
are due to expire. many of them have not had the opportunity to be developed because of the moratorium. the development of oil and gas in the gulf of mexico is an extremely expensive and technical process. it takes about three years of tests, surveys and appraisals before even drilling for the exploration well. regardless of which stage all of the exploration leaseholders are in, the administration ordered all leaseholders to halt exploration activities when its moratorium was enacted. every one of those leases are still being paid for, but they are not able to be explored. we need to restore at least one year of the moratorium so that they get fairness for the money that they have spent and also for the people that they have
kept hired, not sending them away, which has been a hardship on many companies, including some having to go bankrupt because they could not afford to be idle while they also were meeting a payroll. the exploration and development of oil and gas must follow a meticulous process, and any delay such as a moratorium can derail an exploration plan, causing companies to have to give up on their leases. the length of a deepwater offshore lease is usually about ten years because that's what it takes to get all the way through the exploration and the exploration drilling phase to determine if it is worth actually drilling, and many times when you drill you get a dry well. our commonsense legislation has bipartisan support. recently, the office of management and budget stated the administration fully supports
suspensions for gulf of mexico leaseholders directly impacted by the drilling moratorium, but the administration fails to recognize that all leaseholders in the gulf of mexico were directly impacted by the drilling moratorium. james noey, the executive director of the shallow water coalition, wrote me to express his support for the lease act. in the letter, he said -- "without the lease act, vast quantities of proven and producible oil and gas in these expired leases will be trapped. leaving the resources trapped will hurt our domestic production and delay when these resources can come online." i received another letter from the president and c.e.o. of phoenix exploration, a small phoenix-based company. he wrote that the lease act is vital to phoenix exploration and
other small offshore companies because they have been prevented by the administration from industrialing in the -- drilling in the moratorium and have not been able to evaluate many of their gulf of mexico leases, which have been fully paid for through the competitive bidding process. he goes on to say that the time lost from the moratorium makes it very difficult for shallow water, independent operator toes to put together the -- operators to put together the partnership and attract the resources needed to develop leases. the lease act is needed to give offshore energy producers the certainty they need to obtain proper financing to produce domestic oil and gas. so, mr. president, i ask unanimous consent to put the letters that i have read excerpts from in the record. the presiding officer: without objection. mrs. hutchison: and, mr. president, let me just close by saying that i hope that we
will not do something so wron wrongheaded and counterintuitive as to take one section of an industry and say, you're bigger than all of the others and so we're going to tax you differently. we're not going to give you the manufacturing tax credits that we give to every other manufacturer in the world, including the big ones that manufacture in the united states, and we are also going to tax you differently from the smaller oil and gas companies because you're big and they're small. mr. president, i mean, really? is that -- is that america? is that the country that wrote a constitution that said we would guarantee due process of law, that you wouldn't single out one company that is bigger than the others and tax it differently? that's not what our country was
founded on. we should have a fair process. we should have fair taxation. we should be encouraging manufacturing in our country because these companies have a trust with their shareholders. we expect them to do well for their shareholders and they have millions of shareholders that depend on them to do the right thing with their business and with the investment that these shareholders have made. i might add that many pensions are dependent on these kinds of stocks that expect the c.e.o.'s to run the companies in a way that will keep our economy going, keep jobs in america, and keep their stockholders in a position where retirees can live on the income. and, mr. president, we are singling out an industry and saying, no, you're too big, and
so you're going to be taxed differently from other industries. and you don't get the manufacturing incentives that even other big manufacturers get. why wouldn't they move overseas to create jobs overseas where they have a stable regulatory environment, a lower tax base, a lower tax rate, and where they can bring oil up from the ground and import it right back into america? but it will be at higher price because you're going to have it pay for the people to go overseas and haul the oil back. does that really make sense, mr. president? it doesn't make good business sense, and it certainly doesn't make good economic sense. it is not good for our country, and it's certainly not good for the job market that we are trying to build. so i hope that we will not make the mistake of going forward on the menendez bill. i hope that we will realize that
we are a country that has vast natural resources, and we should be using those resources so that our businesses can thrive, so that prices stay loarks so that people will not -- so that prices stay low, so that people will not be strained to put gasoline in their trucks to go to work or do their farming or ranching, to contribute back to the economy. i hope that we will defeat the menendez bill, and i hope that we will adopt a policy that will come through the mcconnell bill tomorrow that will increase exploration, increase production, lower the price of gasoline through our own natural resources, not by importing our own -- the jobs that ought to be in america -- exporting the jobs and importing the product. that doesn't make sense. let's keep the jobs in america, and let's keep our natural resources working for us.
that would be the prudent thing to do, and that will be the mcconnell bill, and i hope we can defeat the menendez bill and maybe we can come together in the senate and give the president a bill that will ask that we have more production and give the level playing field to all of the companies that would hire more people and create jobs in america. and they will do it if there is a level and fair and stable regulatory and tax environment in america. thank you, mr. president. i yield the floor. the presiding officer: the senator from colorado. mr. udall: mr. president, before i begin my remarks, i know the hour is drawing near when we will have a vote and the time limits are approaching as well. i would ask unanimous consent that the full text of my remarks be included in the record. the presiding officer: without objection. mr. udall: thank you, mr. president. i rise today, as many senators have, to talk about the energy-related votes that we
face this week in the senate n my home state of colorado and in the presiding officer's home state of pennsylvania, all over our country, americans are feeling the sting of rising gas prices. and pain at the pump puts a ceil crimp in the budgets of hardworking families and business everywhere. and i hear this every time i am back in my home state and listening and visiting with the folks there. they think it is unfair, and i have to say, i agree. rurun aiway gas price -- runaway gas prices are not fair. it is our job to bring a stop it it. instead of pursuing some commonsense goals that would move our economy forward, that involve a comprehensive energy proposal, we're here punching away at each other on issues largely unrelated to our energy independence and the prices that americans pay at the pump. i am going to support the vote today. we ought to reduce tax breaks
for the five largest oil companies but i really have to say, i wish this had been part of the larger discussion on a comprehensive energy strategy that would allow us to lead the global economic race. that said, i am going to vote to repeal what i think are needless tax breaks for big oil. traditional energy production has received billions of subsidies over the last 70 years -- 70 years -- and the top five oil companies in particular make billions in profits that far exceed the need for more government support. and i happen to agree with thousands of coloradans who have been in touch with me to say, these companies, which are among the biggest in the world, don't need and shouldn't receive taxpayer money, especially as we playbook for ways to consolidate our -- especially as we look for ways to consoli date our dax coate code. the bill is is limited to the top five companies and doesn't include smawcialtion independent produce theirs provide loot of jobs in colorado.
should i note that there's some tax credits like the production tax credit for wind, the investment tax credit for solar, and the intangible drilling cost tax credit for small oil and gas producers that are important to jobs in colorado canned across our country. we would agree the ideal energy market would be free from any tax credits but i also want to make sure that we invest in our domestic energy industries that still need help getting off the ground. as with most policy matters, this is a delegate balance. so let -- this is a delicate balance. so let me remind down my remarks with this question to my colleagues: that we would take responsibility for our economic future and get serious about energy independence. that means that we ha we'd haveo shed some of our doctrinaire positions and what's too often i think hey on the floor a "my way or the highway" approach. there are ways to responsibly drill for oil while also
reducing our energy production. there are ways to harness natural gases a bridge fuel while also spurring a generation of electric cars. these aren't either/or propositions, mr. president. and i think we especially have to seize the clean energy opportunity that's in front of us so that two, four, ten years from now we're not still sidetracked by political infighting because we've once again failed to make the tough decisions. a comprehensive energy policy is critically important to our nation's economic recovery and our long-term energy future. believe me, americans are ready for it. in fact, they're deand i