Offshore Production and Safety Act of 2011-Motion to Proceed
OFFSHORE PRODUCTION AND SAFETY ACT OF 2011--MOTION TO PROCEED
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Mr. CORNYN. Madam President, I wish to talk for a moment about the ill-considered proposal we will be voting on at 6:15 tonight and about the administration's chaotic approach when it comes to our national energy policy. I say ``chaotic approach'' because to pay attention to what the President and this administration have said about fossil fuels and energy will give you whiplash if you try to keep up with it because there are so many, apparently, inconsistencies between what is said and what is actually done, and then when something like high gasoline prices becomes very much a concern around kitchen tables in America, then all of a sudden the President again, as he announced the last day or two, is all of a sudden open for more domestic product.
It is a problem for a number of reasons. One is, who in their right mind would invest the kind of money that is necessary in order to develop our domestic energy reserves when the administration and the President himself seem to be of two minds about whether
we should punish domestic production or whether we should encourage it.
I would suggest to you that the message has primarily been one of how to discourage or how to punish domestic production of energy in favor of imported energy from abroad. For example, one of the mixed messages the President gave was in March of 2010 when he proposed expanding offshore drilling along the Atlantic coastline, the eastern Gulf of Mexico, near my home in Texas, and the north coast of Alaska. At that time, he said as follows. He said: The answer is not drilling everywhere all the time, but the answer is not also for us to ignore the fact that we are going to need vital energy sources to maintain our economic growth and our security.
Well, I agree with that statement, but, as you know, following the Deepwater Horizon incident last April, the administration overreacted in a way that killed jobs and discouraged energy production here at home. We all agree that when something like this terrible incident occurs, we need to find out what happened, fix it, and make sure it never happens again. But every time there is a car accident, we don't ban driving. Every time there is an airplane crash, we don't ban flying. We find out what the problem is, we fix it, and then we move on.
That is not what happened in the Gulf of Mexico. First, there was an overbroad moratorium that was issued by the administration, which ultimately ended up being struck down by a Federal judge. But after that, the administration was not through. While their formal moratorium no longer existed, there was, in effect, a permitorium--in other words, foot-dragging when it came to issuing permits for drilling in the Gulf of Mexico--and only 12 deepwater permits have been approved in the last 12 months. There were, in addition, the cancellation of dozens of lease sales in Utah and Montana and exclusion of new areas in the eastern Gulf of Mexico and off the Atlantic coast. That, to me, is completely inconsistent with the President's statement just in March 2010. And then we know there are numerous examples where the Environmental Protection Agency has thrown up roadblocks and impediments to energy production right here at home.
Well, because the President has not had an adequate response, or at least his actions have been inconsistent with his words, he reversed himself again this Saturday, and he said now he supports more domestic oil and gas production like he did more than a year ago. But my conclusion is that this is not an energy strategy. This is a public relations strategy. This is a ``how do I get reelected?'' strategy. It does not solve the problem or the pain 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 around America are complaining about the loss of their discretionary incomes, the fact they are having to cut corners so they can drive their kids to school or so they can drive to work, finally we 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 has suggested that we are actually overproducing domestic energy. 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 percent of what we use from abroad? Well, the Congressional Research Service that we depend on--it is an 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 have learned in the last couple of years that America has more shale gas from previously unrecoverable reserves--thanks to new technology, horizontal drilling and the like--we have enough natural gas to last us for 100 years here in the United States.
But compare that--really that gift we have been given of domestic energy at home--with what the administration said 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, who is appointed by the President, confirmed by the Senate--the Treasury Department said:
To the extent the [tax] credit--
That is the tax credits we are talking about here--
encourages overproduction of oil and gas, it is detrimental to long-term energy security.
So the Treasury Department, President Obama's Treasury Department, is making the extraordinary claim that I have not heard any Senator here make 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 the existing leaseholders 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 percent of our energy needs come from fossil fuels because we prefer alternative forms of energy. Well, I do too--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 keep prices low for our domestic consumers.
Well, another part of this mixed message is our dependency on imported oil. On March 30, 2011, President Obama called for reducing foreign imports by one-third. But then he went to Brazil recently. 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, rather than producing what we have been given by the Good Lord right here in America--American production, American jobs--he wants to be Brazil's best customer by importing energy from abroad.
Well, part of the vote we will be having at 6:15 or so tonight is another part of the mixed messages 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 done so--because they have been getting so much heat back home because of high gas prices. Their constituents are demanding that they do something. But what they 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, said: You know, this is not going to change the price at the gasoline pump. That is not the issue. I do not 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 is not a question of gas prices; it is a question of fairness and priorities.
Well, if gasoline prices being paid by Americans all across this country are not the priority and if jobs that are created and sustained by producing domestic oil and gas right here in America are not the priority, my colleagues who are proposing this legislation have the wrong priority.
Now we are told they have a new idea--that the money that is supposedly saved from these tax provisions will then be used to pay down the deficit.
The truth is, the amount of money that would go to pay down the deficit--even if our friends across the aisle had a conversion and decided 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 we are experiencing this year and the $14 trillion national debt we are going to have to reckon with in the next couple months.
If deficit reduction is a priority, I submit the very best way we could do that is to pass a balanced budget amendment to the U.S. Constitution. But that is not the priority of the majority leader or of the majority or of our friends across the aisle. If the rationale for this bill is not to reduce gasoline prices, if the rationale for this
bill is not to produce a balanced budget, then what is it? What is it? The majority leader suggested it was fairness--fairness.
The Chairman of the U.S. Chamber of Commerce calls it punitive taxation, picking out five taxpayers in America and saying: We are going to raise your taxes and leave everybody else's the same. It is discriminatory and it is punitive. But it is also, in the immortal words of Rahm Emanuel, former White House Chief of Staff, now mayor of Chicago, a case of never letting a crisis go to waste to advance another ideological agenda.
The truth is, we know our Tax Code is already biased against U.S. domestic energy producers. If our 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.
I did not think making money was a crime in America. I thought we still believed in the free enterprise system. The very people our friends across the aisle are going to punish are the retirees and the pension holders, the people who own stock in these oil and gas companies who are going to be forced to pay higher prices which will ultimately be passed along to the consumer, I believe, in higher energy costs.
The other revealing point about this debate is they want to punish people who produce American energy right here at home, and they are going to leave OPEC and these other countries to pay lower effective relative rates. If we raise taxes on American producers and we do not do anything to similarly raise taxes on their competition, what is going to happen? What is going to happen to the Saudi Arabian Oil Company? What is going to happen to the Iraq National Oil Company? What is going to happen to 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 do not produce it at home, and we are going to raise taxes on the people who produce it at home and make it, in effect, cheaper for foreign energy producers to produce it and sell it to us. It makes absolutely no sense. It is punitive, it is discriminatory, and it is not going to solve the problem that most Americans are complaining about today, which is high gasoline prices. In fact, it will make it worse.
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. I witnessed the people who work in this sector in my State. In March I visited a brandnew drilling rig that is using the latest technology to produce natural gas from the Haynesville Shale in east Texas. This is amazing technology that goes down thousands of feet and drills horizontally and uses high pressure fluids to fracture this shale--in effect, the 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.
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Mr. CORNYN. Madam President, I could go on and on about the economic 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 do not pay enough and others pay too much, I ask them to consider the fact that according to the Congressional Research Service, 77.9 percent of our primary energy production in America is fossil fuel sources, and of the Federal tax support targeted to energy in 2009, 12.6 percent went to fossil fuels--12.6 percent of those Federal tax supports went to people who produce oil and gas.
Conversely, 10.6 percent, 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 percent.
Why are we picking on American oil and gas production, forcing us--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 these higher prices, and when, in fact, even as our friends across the aisle acknowledge, at the very best this will not bring down the prices at the pump.
They say that is not the point. If that is not the point, then the point appears to be a game of gotcha and a sort of finger-pointing and class warfare we have seen that is endemic inside the beltway.
I have to tell you, I think the American people are sick and tired of this sort of game playing when, in fact, they send us here to solve real problems. If we could find a way--instead of this game playing, instead of this phony game of gotcha--to try to work together to solve real problems through increased domestic supply, which would, indeed, bring down prices at the pump, as the President himself has acknowledged when he said we have to look at domestic production, then I think they would reward that with their appreciation, and appreciation in terms of American jobs being sustained and created here because we are not creating jobs abroad to buy the very product we need to run our cars and trucks.
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