Farm, Nutrition, and Bioenergy Act of 2007

Floor Speech

FARM, NUTRITION, AND BIOENERGY ACT OF 2007 -- (Senate - December 13, 2007)

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Ms. CANTWELL. Mr. President, I too rise in support of the cloture motion this morning and ask my colleagues if we are going to pass the Energy bill before the end of this year. I know the American consumer has gotten a wake-up call because they are paying higher gas prices at the pump. But the question is whether Congress and the White House have gotten the same wake-up call.

Fortunately, thanks to the hard work of Members on both sides of the aisle and many staff members we are within grasp of a very important solution. I am not even going to spend my time this morning talking about the important details of this bill because many of my colleagues, including the chairman of the Energy Committee, has extolled its virtues. Perhaps, if I have a minute at the end, I might elaborate on some of these. But it is time to get to the heart of the matter. And that is, the American people need serious relief from a future of high oil prices by making a transition this legislation would provide. That is we need to make sure we have an energy package that starts investing more aggressively in renewable energy and will actually get us competition at the gas pump and on our electricity grid.

I know some are saying the tax title in this bill must go. And some have even been bold enough to say that it's an increase in taxes. That is an interesting position because these are really tax subsidies for the oil industry. They are not a tax increase on consumers. When we passed similar tax provisions in the 2005 energy bill no one on the other side called that a tax increase.

In fact, when the President put broader subsidies in his budget this year, reducing some of the same subsidies, it was called a modification. So do not tell us now that cancelling a subsidy for the oil industry is somehow raising taxes on consumers. What we are really doing is continuing to make consumers pay more at the gas pump because we are not giving them true competition. At the heart of the matter is the fact that of the energy subsidies and investments that our country makes--that is, using American tax dollars to invest in energy strategies that will help our country--right now 75 percent of them is going to the fossil fuel industry. Only about 15 percent is going to clean energy.

Now, I ask my colleagues, when the United States only has 3 percent of the world's oil reserves, is it smart to continue to have the 75 percent investment in fossil fuels? I would say that we should pass this legislation and make more investments in renewable and energy efficiency.

If someone says that somehow this is going to impact the oil industry, I would like to refer them to a quote from Lee Raymond, the former ExxonMobil CEO who said on ``Fox News'' when asked whether Exxon was taking advantage of the new legislation that became law to speed up the development of refineries and capacity here in the U.S., he said ``it will not have a major impact.''

So I do not know why we are so concerned about keeping these subsidies when the industry itself, the big five oil companies are saying it has had a negligible impact. What it has had an impact on is consumers. And even the Joint Economic Committee has pointed out that the removal of these tax breaks are going to have very little impact on consumers. In fact, another third party observer, the Joint Tax Committee, basically said this $300 million in subsidies from the big five oil companies in 2008 that would be taken away would be less than 1 percent. In fact, it would have only a one-quarter of 1 percent impact on their profits.

That is right. They made $120.8 billion in profit in 2006, so taking this subsidy away from them it will have a negligible impact. So what are we holding this up for? Why are we going to hold up the Energy bill because someone does not want to take more subsidies away from the oil industry and put them toward clean energy?

Even President Bush recognized that the oil industry does not need more subsidies. President Bush, in April of 2005, said:

I will tell you with $55 oil we don't need incentives to oil and gas companies to explore. There are plenty of incentives.

I couldn't agree with the President more. He said that at $55 a barrel. Now that we are at $90, we need to move faster in changing these incentive programs. We all know that fossil fuels will continue to be a big part of the energy mix for decades and that there is a great deal of economic benefit from the incentives in oil and gas today. But what we have to realize is we cannot continue in this same direction. We have to change course. We have to level the playing field and take away subsidies from very mature, very profitable industries and make investments in renewables instead.

I know the President also agrees with that because when he signed the 2005 bill, he said:

The bill offers new incentives to promote clean, renewable geothermal energy ..... When you hear us talking about less dependence on foreign sources of energy, and one of the ways to become less dependent is to enhance the use of renewable sources of energy.

Again, I couldn't agree with the President more. But this is about getting a package that will help us give consumers the confidence that they are going to have true competition over the price at the pump.

The Energy and Finance Committees had hearing after hearing talking to the experts. I know some people on the other side of the aisle would say that some of these tax incentives don't expire until the end of 2008. But this is about giving predictability to energy investment strategies. We heard in the Finance Committee testimony after testimony from experts saying: If you want to get more investment in renewable energy, you need to have more predictable energy tax credits. That is why we can see from our failed policies in the past that countries such as Denmark have made more headway, because they made more investment in renewables. Countries such as Japan have made more headway in solar energy because they made the investments. If we want to get beyond petroleum, we have to stop subsidizing it.

The impact of this morning's vote is that our colleagues are going to say we should take out the Finance package and that somehow will be a completion of an energy strategy. I tell my colleagues, nothing could be more important than getting the long-term fundamentals right for investment so that America can get off our dependence on foreign oil.

This legislation does represent nearly a 20-percent reduction in our current CO2 output and a 35-percent reduction in our foreign oil dependence. But to get those savings, we not only have to pass CAFE, we also have to pass incentives for renewable energy and do it for more than just 1 year so that we have predictable investment in these energy strategies and reap the economic benefits in jobs for America.

I thank the staff and all Members who have worked so hard on this legislation.

I yield the floor.

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Ms. CANTWELL. Mr. President, if I could respond to a couple of things my colleagues on the other side of the aisle said because this is an important debate. If there are people who want to continue to debate the farm proposal we are going to be voting on this morning, I will be happy to yield the floor. But not seeing that, I am happy to continue the discussion on the Energy bill.

Both Senators from New Mexico have played an incredible leadership role in energy, and the 2005 Energy bill was a bipartisan effort. I certainly know what it is like to take half a loaf. That was not the bill I would have written myself, but I voted for that legislation. I think it started us on a course of making investments in renewable energy technology that was beneficial.

In particular I happen to disagree that the 2005 tax provisions, as they related to more subsidies for the fossil fuel industry, have been a big benefit for us. We even had an executive of an oil company say they did not think they were going to have much impact. So now consumers in my State are paying over $3 at the pump, and home heating oil prices are up 35 percent. So I do not think those subsidies to the oil industry have had any kind of magnificent impact that my colleague from Texas was saying.

What we do know is the investment we started in the 2005 bill in renewable energy is having an incredible impact. The question is whether we are going to give predictability to that industry. I would hate to think this is a vote--whether it is on this bill or any future bill; and this Senator would certainly take these provisions and put them on lots of different vehicles. It does not have to always be in this precise fashion--but the fact is, this bill and these tax incentives will generate over 50,000 megawatts of new, clean energy supply and efficiencies. That is right, it does create new generation.

Mr. President, 50,000 megawatts, in case anybody wants to know, is the same amount of electricity that is used in 26 States today. So the question is whether we are going to have a 1-year extension--that is, until 2008--for renewable energy, or whether we are going to give them 2, 3, 4 years of predictability so we can get that generation, as I said, that will produce enough electricity for 26 States out of renewable and efficiency generation, instead of continuing to use those tax subsidies for the oil industry that, even by their own account, they say are not having a significant impact.

So I would say to my colleagues on the other side of the aisle, I have heard what the President has said. We have heard all along that he thinks these particular provisions are raising revenues on one industry. The President included in his own budget a broader reduction in the subsidies that we had previously passed, and nowhere did he call that raising revenue. So by his own account, it is hypocrisy to now start claiming these are somehow different.

What we need is to pass this Energy bill. I look forward to working with my colleagues in a bipartisan fashion on many of the provisions that are in this legislation that will diversify us off of fossil fuel and get us into renewables and biofuels, so we can lower the price at the pump for consumers.

Mr. President, I yield the floor.

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