Big Oil Welfare Repeal Act of 2011

Mr. Speaker, today the House considers the BP respill bills. That might not be what they are officially called, but it's a much more accurate title for this legislation. It's clear that the authors of these BP respill bills did not learn any lessons from the Deepwater Horizon disasters. These bills would make offshore drilling more dangerous for offshore workers, 11 of whom died on the Deepwater Horizon. These bills would make offshore drilling more dangerous for the environment, which was coated with 4.1 million barrels of oil along the Gulf Coast and is killing fish and wildlife in the area to this day as a result of BP's recklessness.

These bills would make offshore drilling more dangerous for our national security because they reinforce the complete myth that America can somehow drill our way out of dependence on oil. And these bills are more dangerous for the economy, risking destroying fishing and tourism jobs in affected areas.

But one thing these bills do not do is make filling up at the pump any more affordable at all for American families. According to the American Petroleum Institute itself, the main advocacy group for oil interests, even if we opened all Federal land to oil drilling, including offshore areas, including Alaska's wildlife refuge and all Federal land that is in the national parks, they can't even say that it would reduce gas prices or oil prices. In fact, the cheap oil analyst at the Oil Price Information Service, which calculates gas prices for AAA, the motorist organization, said: ``This drill, drill, drill thing is tired. It's a simplistic way of looking for a solution that doesn't exist.''

So if this legislation isn't about reducing the price at the pump, what is it about? It's about exploiting our legitimate concerns about high gas prices to deliver another huge giveaway to Big Oil, an industry that made over $35 billion in profits in the last quarter alone. Meanwhile, the majority refuses to end Big Oil's nearly $50 billion of special interest tax breaks.

Yesterday in the Rules Committee, Mr. McGovern brought forth a bill that would have ended the giveaway of tax revenue to Big Oil. Unfortunately, the Republican majority chose not to allow that amendment in this rule.

Had that been allowed under the open rule that Mr. McGovern proposed, I would have brought forth an amendment on the floor to use those $50 billion of revenue to reduce the corporate tax rate to help create jobs in America. Instead, the Republican majority is continuing to seek to keep American taxes high, to keep corporate taxes high, and this is another example of a job-destroying bill that keeps taxes high while picking winners and losers in the economy and using government subsidies to aid an industry that is one of our most profitable industries.

We should allow American businesses of all sizes to compete. The America corporate tax rate of 35 percent is higher than most of the rest of the world, which is why many companies continue to engage in operations overseas. If we can reduce it from 35 percent to 30 or 28 or 26 percent--and we could have done had Mr. McGovern's amendment passed in the Rules Committee yesterday, and that is one of the reasons I oppose this rule today--that would create an enormous engine of economic growth.

While frequently the Republicans give lip service to lower taxes, they continue to use special interest tax breaks to keep taxes high on small- and middle-sized American companies that don't have the same lobbyists here in Washington to lobby us for special interest tax breaks.

We know that Big Oil would rather do without the fuss of showing that they can drill safely; but that's what this bill, in fact, delivers. This legislation states that the Interior Secretary must act on any drilling permit within 60 days, or it's automatically approved. What should be a very serious process to ensure safe drilling, to ensure that there aren't further disasters, and to ensure that jobs are not destroyed turns into little more than a rubber stamp, a rubber stamp for the further degradation of our economy and of our environment.

The second bill this rule makes in order claims to restart the process, or issuing, of oil and gas leases. Now, what the majority is doing in this is essentially validating what the administration has already done. The administration has already restarted offshore drilling in February. In fact, the administration has announced plans to offer all three Gulf of Mexico lease sales that are mandated in this bill this year or early next year. Again, this particular policy is one that I don't agree with fully with the administration, but I am glad to see that the Republican majority is validating President Obama's leadership on this energy issue.

Together, these bills will not relieve pain at the pump, but they will increase the chances of another Deepwater Horizon disaster, costing lives, livelihoods, and hurting some of our precious natural resources. Why? Because that's what Big Oil wants. If Big Oil wants to keep taxes high for American companies, if Big Oil wants to destroy jobs, then the Republican majority is giving them that. In fact, even the problem the majority purports to be addressing with these bills, the speed of permitting in the gulf and restarting offshore oil drilling, doesn't even exist.

Here are the facts: Following the temporary pause on deepwater drilling last year, what Secretary Salazar listed in October, the oil industry wasn't able to demonstrate that it possessed the capacity to contain a deepwater blowout until February 2011. Once oil companies demonstrated that they had the capability to contain a blowout, the first permit was issued 11 days later, February 28, 2011. There have now been a total of 10 deepwater drilling permits issued since that time. In addition, there have been 39 shallow water permits approved since last October, matching the number from before the spill. Let me repeat that: matching the number of permits from before the spill. If anything, the majority, by acting through this bill, is effectively congratulating the administration on its leadership for speedily approving permits.

In addition, in the gulf region, the number of jobs that depend on tourism and fishing is five times the number of jobs related to the oil and gas industry. Gulf jobs related to oil and gas and other resource extraction total about 154,000. The total number of jobs for tourism and fishing are 777,000 jobs. So with this bill, the majority is putting at risk those 777,000 jobs for the benefit of 154,000. We should not put them at risk just to make the permitting process easier for Big Oil to exploit.

Passage of these bills is not good for the gulf coast's economy or its ecology, although it is best for Big Oil.

Again, while I appreciate the Republican majority's efforts to validate the leadership of President Obama on energy issues, this rule could be a lot better. Rather than keeping corporate taxes high, we could help make America more competitive by reducing corporate taxes and helping make American businesses more competitive, including the critical tourism and fishing industries in the gulf coast.

I reserve the balance of my time.

I yield 2 minutes to the gentleman from Rhode Island (Mr. Cicilline).

I yield 2 minutes to the gentleman from Oregon (Mr. Blumenauer).

Mr. Speaker, with regard to the subsidy issue, the simple fact of the matter is that the Republicans are not for free markets. But what they are for is Big Oil co-opting free markets. In fact, 70 percent of all energy-related subsidies go to fossil fuels like oil and coal. Less than 5 percent of subsidies go to renewable energies like wind and solar.

The gentleman from Utah pointed out that many of these subsidies help small drillers, and, in fact, that can be true. But it is easy to apply changes only to the Big Oil companies and not even affect independent producers.

There's simply no excuse not to end this corporate welfare which keeps taxes for all Americans who pay their taxes artificially high. In fact, at the same time that BP was reaping sizable tax benefits from leasing the Deepwater Horizon rig, it turned out that the company was using the tax break for the oil industry to write off 70 percent of the rent for Deepwater Horizon. That tax subsidy cost American taxpayers $225,000 a day since the lease for Deepwater Horizon began. And that's just one example of many.

I also want to address some misperceptions regarding President Obama's policies regarding oil resources. The Obama administration is allowing, on average, more drilling than the Bush administration did. In fact, the Obama administration approved more leases in 2010 than the Bush administration did in any year except one of his presidency.

Again, in moving forward and reissuing permits, which the administration has already begun to do, this bill helps validate President Obama's leadership on this issue.

The real issues at hand are the subsidies that the industry continues to receive. As long as we continue a policy of using taxpayer dollars to artificially pick winners and losers in the economy, the winner here being Big Oil, the loser being American taxpayers, we will continue to hurt energy security, destroy jobs, and continue to put our environment at risk.

I reserve the balance of my time.

I yield myself 30 seconds.

Mr. Speaker, if we defeat the previous question, I will offer an amendment to the rule to provide that, immediately after the House adopts this rule, we will bring up H.R. 1689, the Big Oil Welfare Repeal Act of 2011.

Mr. Speaker, I ask unanimous consent to insert the text of the amendment in the Record, along with extraneous material, immediately prior to the vote on the previous question.

The nonpartisan Joint Committee on Taxation, in its analysis of the administration's budget, stated that the repeal of oil and gas preferences are ``likely to have no effect on the world price of fossil fuels, and any increase in prices for domestically consumed fossil fuels are likely to be attenuated.''

Again, when we talk about ending the giveaway to Big Oil and Gas, it will have no effect with regard to actual energy prices.

Mr. Speaker, I am proud to yield 1 minute to the gentlewoman from California, the Democratic leader, Ms. Pelosi.

Mr. Speaker, I yield 3 minutes to the gentleman from Massachusetts (Mr. Markey), the ranking member of the Natural Resources Committee.

Mr. Speaker, I would like to yield 2 minutes to the gentlewoman from Texas (Ms. Jackson Lee).

Mr. Speaker, I yield 2 minutes to the gentlewoman from Florida, a former member of the Rules Committee, Ms. Castor.

I yield 2 minutes to the gentleman from Virginia (Mr. Moran).

Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from New Jersey (Mr. Holt), the ranking member of the Energy and Natural Resources Subcommittee.

I yield the gentleman an additional 15 seconds.

I yield 1 minute to the gentleman from Massachusetts (Mr. Keating).

Mr. Speaker, how much time remains?

I yield myself the balance of my time.

With regard to the last comment, it is the oil cartels that drive prices, not the normal functions of the market and supply and demand.

With regard to the oil subsidies, Mr. Speaker, we have an opportunity here today to see where the Republicans and the Democrats in the House stand on deficit reduction. Mr. Speaker, by defeating the previous question, we can and we will reduce the deficit by over $12.8 billion. We have the chance to have the discussion around the continuing resolution, around the budget, around deficit reduction. And here we have an opportunity, without impacting the price of oil, without impacting what consumers pay at the pump, to reduce the deficit by $12.8 billion by defeating the previous question. I think that's what the American people want to see.

The American people spoke out in the last election. Let's reduce the deficit. Let's work across the aisle to see what we can do to cut unnecessary government expenditures, to make those decisions to help make sure that we can leave something other than a legacy of debt to the next generation.

I think, Mr. Speaker, this is an easy one. Let's defeat the previous question and reduce the deficit by $12.8 billion.

Mr. Speaker, I would like to submit for the Record a document from the Treasury Department which states that the manufacturing deduction for oil and gas effectively provides a lower rate of tax with respect to a favored source of income. In fact, it distorts the market by encouraging more investment in the oil and gas industry than would occur under a neutral system.

Again, by returning to the free market, we are able to reduce the deficit by over $12.8 billion instead of having Big Government trying to pick winners and losers in the economy with regard to tax policy.

General Explanations of the Administration's Fiscal Year 2012 Revenue

Proposals--Department of the Treasury, February 2011

Repeal Domestic Manufacturing Deduction for Oil and Natural Gas

Companies

Current Law

A deduction is allowed with respect to income attributable

to domestic production activities (the manufacturing

deduction). For taxable years beginning after 2009, the

manufacturing deduction is generally equal to 9 percent of

the lesser of qualified production activities income for the

taxable year or taxable income for the taxable year, limited

to 50 percent of the W-2 wages of the taxpayer for the

taxable year. The deduction for income from oil and gas

production activities is computed at a 6 percent rate.

Qualified production activities income is generally

calculated as a taxpayer's domestic production gross receipts

(i.e., the gross receipts derived from any lease, rental,

license, sale, exchange, or other disposition of qualifying

production property manufactured, produced, grown, or

extracted by the taxpayer in whole or significant part within

the United States; any qualified film produced by the

taxpayer; or electricity, natural gas, or potable water

produced by the taxpayer in the United States) minus the cost

of goods sold and other expenses, losses, or deductions

attributable to such receipts.

The manufacturing deduction generally is available to all

taxpayers that generate qualified production activities

income, which under current law includes income from the

sale, exchange or disposition of oil, natural gas or primary

products thereof produced in the United States.

Reasons for Change

The President agreed at the G-20 Summit in Pittsburgh to

phase out subsidies for fossil fuels so that the United

States can transition to a 21st-century energy economy. The

manufacturing deduction for oil and gas effectively provides

a lower rate of tax with respect to a favored source of

income. The lower rate of tax, like other oil and gas

preferences the Administration proposes to repeal, distorts

markets by encouraging more investment in the oil and gas

industry than would occur under a neutral system. This market

distortion is detrimental to long-term energy security and is

also inconsistent with the Administration's policy of

supporting a clean energy economy, reducing our reliance on

oil, and cutting carbon pollution. Moreover, the tax subsidy

for oil and gas must ultimately be financed with taxes that

result in underinvestment in other, potentially more

productive, areas of the economy.

Proposal

The proposal would retain the overall manufacturing

deduction, but exclude from the definition of domestic

production gross receipts all gross receipts derived from the

sale, exchange or other disposition of oil, natural gas or a

primary product thereof for taxable years beginning after

December 31, 2011. There is a parallel proposal to repeal the

domestic manufacturing deduction for coal and other hard

mineral fossil fuels.

Mr. Speaker, I would also like to submit for the Record a July 3, 2010, New York Times article regarding oil subsidies.

Again, this talks of the oil subsidies that continue to benefit this industry to the detriment of the American taxpayer and to the detriment of future generations of Americans who will continue to suffer under an increasing mountain of debt unless we defeat the previous question here today.

[From NY Times, July 3, 2010]

On Subsidies

But an examination of the American tax code indicates that

oil production is among the most heavily subsidized

businesses, with tax breaks available at virtually every

stage of the exploration and extraction process.

According to the most recent study by the Congressional

Budget Office, capital investments like oil field leases and

drilling equipment are taxed at an effective rate of 9

percent, significantly lower than the overall rate of 25

percent for businesses in general and lower than virtually

any other industry.

And for many small and midsize oil companies, the tax on

capital investments is so low that it is more than eliminated

by various credits. These companies' returns on those

investments are often higher after taxes than before.

Efforts to curtail the tax breaks are likely to face fierce

opposition in Congress; the oil and natural gas industry has

spent $340 million on lobbyists since 2008, according to the

nonpartisan Center for Responsive Politics, which monitors

political spending.

Some of the tax breaks date back nearly a century, when

they were intended to encourage exploration in an era of

rudimentary technology, when costly investments frequently

produced only dry holes. Because of one lingering provision

from the Tariff Act of 1913, many small and midsize oil

companies based in the United States can claim deductions for

the lost value of tapped oil fields far beyond the amount the

companies actually paid for the oil rights.

Other tax breaks were born of international politics. In an

attempt to deter Soviet influence in the Middle East in the

1950s, the State Department backed a Saudi Arabian accounting

maneuver that reclassified the royalties charged by foreign

governments to American oil drillers. Saudi Arabia and others

began to treat some of the royalties as taxes, which entitled

the companies to subtract those payments from their American

tax bills. Despite repeated attempts to forbid this

accounting practice, companies continue to deduct the

payments. The Treasury Department estimates that it will cost

$8.2 billion over the next decade.

Mr. Speaker, 1 year after the national tragedy of Deepwater Horizon, the majority party has decided not to address a single problem that led to this economic and environmental tragedy. Instead, the majority is pushing through these bills, simply rubber-stamping offshore drilling and maintaining taxpayer subsidies and giveaways to Big Oil, which increase the deficit.

During a Special Order speech just the other night, a Member on the other side of the aisle said all you need is an eighth grade understanding of supply and demand to understand why gas prices are high and how we can lower them by drilling more. Fortunately, for those of us who have more than an eighth grade education, like economists and other experts, we know that America cannot drill its way out of high gas prices. Even the American Petroleum Institute, the mouthpiece for Big Oil, is saying that we cannot drill our way out. ``Drill, Baby, Drill'' may look good as a bumper sticker, but it's not a serious energy policy.

I urge my colleagues to vote ``no'' on the bill and to defeat the previous question so we can reduce the deficit.

I yield back the balance of my time.

Mr. Speaker, on that I demand the yeas and nays.

Mr. Speaker, I demand a recorded vote.

Mr. Speaker, by direction of the Committee on Rules, I call up House Resolution 245 and ask for its immediate consideration.

Mr. Speaker, for the purpose of debate only, I yield the customary 30 minutes to the gentleman from Colorado (Mr. Polis), pending which I yield myself such time as I may consume. During consideration of this resolution, all time yielded is for the purpose of debate only.

General Leave

Mr. Speaker, I ask unanimous consent that all Members have 5 legislative days to revise and extend their remarks.

Mr. Speaker, House Resolution 245 provides for the consideration of two very important bills, H.R. 1229, the Putting the Gulf of Mexico Back to Work Act, and H.R. 1230, the Restarting American Offshore Leasing Now Act, both under a structured rule. With many amendments, all of which are Democrat amendments having been made in order, this is a very fair rule.

I commend the sponsor of the two bills, the chairman of the Natural Resources Committee, Mr. Hastings of Washington, for his leadership in bringing both of these bills to the House.

H.R. 1229 is a bill that goes to the heart of the bureaucratic delays, which are preventing the approval of drilling permits within the Gulf of Mexico; and it modifies the standards and procedures governing Federal leases and permits in order to streamline the process, making the development of these domestic resources a reality instead of the status quo of paying lip service to drilling and then stifling drilling through bureaucratic inaction.

H.R. 1230 is a bill that would direct the sale of oil and gas leases within the Outer Continental Shelf, reversing a failed administration policy of canceling and delaying those processes.

Mr. Speaker, over the last 2 years, many Republicans have come to this floor and have sung the same refrain of ``show us the jobs.'' It was, indeed, a nice song and a catchy tune--so catchy that the minority of today seems to have been picking up on that kind of song as well. I don't expect to hear that today, or at least we ought not to hear it today, because the two bills before us under this rule are real bills that create real jobs for people.

Unlike the bills we have seen over the past couple of years which have led us to a situation where today there are twice as many workers in the government as there are in all of manufacturing in this Nation, which is an exact reverse of the situation this Nation was in in 1960, these are not going to be government jobs which attack the taxpayers and suck the money out of their wallets to fund them. These are going to be real jobs that grow the private sector, that expand the economy, that provide wealth, and that will provide, actually, millions of new government revenues coming into this country.

The situation we find ourselves in today with regard to energy is one that is detrimental to everybody. Everyone who goes to the pump to fill their cars recognizes the cost is increasing and will continue to increase. They recognize that the situation we are in puts all our jobs in jeopardy, and it is because of the inaction of this particular administration. The President has continually said that he wants to do action, to move forward, to develop American energy, but the actions of his administration have, quite frankly, failed to meet the rhetoric of the administration.

The problem has always been a fundamental flaw in our Nation's energy plan. Last May, the Deepwater Horizon accident occurred, which was a tragedy; and we must thank all of those who helped to solve that particular problem; but, unfortunately, the administration's response to that tragedy has turned it into a catastrophe and one which destroys jobs.

Immediately, a moratorium on all sorts of development was put into place. Prior to that moratorium being put into place, there were 52 approved and pending permits, and that moratorium was lifted in October; but of those 52, only 10 permits have been issued since that time. Two of them are new in deepwater and are eight of the 52 that were originally done. That means there are over 40 still approved and still stalled in what has become a de facto moratorium, caused by a foot-dragging of this administration that, what one columnist said, is moving at a glacial pace. More rigs have left our shore--12--to go to other places in the world where they are welcomed and where they are developing energy sources, where they don't have to face the red tape and the foot-dragging than have actually been approved by this administration.

A perfect example is Seahawk Drilling, a company that had over 500 jobs and 20 rigs that went into chapter 11 bankruptcy. The president of that company stated only one reason for that bankruptcy and that loss of jobs, which was the de facto moratorium of inaction done by this administration in this area in 2008 in a response to an arbitrary drilling ban that was lifted by both the President and Congress. It created a 5-year plan. Virginia was supposed to start the exploration process in 2011, but the Secretary of the Interior delayed that until 2012 and then later delayed all exploration on the Atlantic coast until after 2017.

In the Gulf of Mexico, two other sales were canceled and moved out from this year, which was when they were supposed to begin, once again into next year. It became so bad that a judge in New Orleans gave the administration 30 days to start moving on these projects, saying that what was happening by this administration was increasingly inexcusable and that not acting at all is not a lawful action.

The result of this has simply been catastrophic for jobs in America. The Obama administration has admitted in its official memorandum that, for those days of its official moratorium, 12,000 jobs were lost; but what is more significant is the de facto moratorium there. An LSU study simply said, if this were sustained for 18 months in the gulf area, there would be 24,532 jobs lost and in the Nation 36,137 jobs lost simply because of what we are not doing in the Gulf of Mexico.

It is very simple to understand how this works. Each platform that is out there drilling has 90 to 150 employees. If you add the production team as well as the exploration team, you can multiply that by a factor of four. So you have almost per every drilling up to 1,400 jobs that are tied to that particular project with $1,800 a week as the average wage.

That means for every one of those drills that is not put back into production, it is $5 million to $10 million per month per platform that is lost to this economy; and the ripple effect within the economy for our energy uses as well as jobs is, once again, staggering as this administration is, indeed, going at a glacial pace. In Virginia alone, 2,000 jobs will be estimated to be lost if the de facto moratorium that pushes everything to 2017 is allowed to take place.

Now, this action, or inaction, by the administration costs every American. It costs us at the gas pump as we see the cost of running our cars increasing almost daily, and this hurts the poor worse than anyone else. It is estimated that every American will pay $700 more this year for gasoline than least year. Obviously, those at the lower end of the economic scale are the ones who are hurt the most. For every cent that is increased in gas at the pump, that is $1 billion that is taken out of household incomes in this country; and it makes sure that Americans are then put at the mercy of foreign oil development and foreign energy sources, which may not necessarily like us, and sometimes they're just flat out bad guys.

It also has other areas in which it has affected everyone--once again, those at the lower end of the income scale the most. For every dime that diesel goes up, that is $400 million that is added to the agricultural industry, which is what we eat, which is tacked onto our food prices. You have to have oil for fertilizer. As that goes up, the cost of fertilizer goes up; the cost of running machinery goes up; the cost of food goes up; the cost of pharmaceuticals, plastics. If you go into the emergency room, everything that is not metal has some element of oil that developed it, and all of those are increasing.

Now, there are only two ways that we can handle this situation. First, you can go with the old concept of supply and demand and simply increase production, which is what these two bills are trying to do; or you can go to the approach that this administration seems to be asking us to do, which is to cut our standard of living, accept gasoline prices at the European level, and beg Saudi Arabia to be nice to us--to put our futures in the hands of OPEC and then amazingly say we can also solve these problems simply by taxing oil companies at a higher rate.

Since 2010, the domestic production of energy in this country has decreased 16 percent. In this year, next year and the year after that, we estimate, unless we make changes, that a quarter of a million barrels of oil will be decreased in our production rate in each of those years. The only area in which any energy production has been increasing is on private property. Unfortunately for this country, almost all of the energy that we have, most of the energy that we can develop, is on public lands, which is controlled by the government, which is doing nothing now to help develop that.

This is a time where pragmatism is much better than a failed ideology of restrictions. Now, what these two bills do is to simply reverse the job-killing delays that have been taking place. In H.R. 1229, it reforms the law to require leaseholders to receive permits to drill before they start drilling; and it will do it for the first time by law, not simply by a regulation. It demands that the Secretary of the Interior conduct and approve safety revenues, once again, for the first time in history.

More importantly, it ends the de facto moratorium by demanding prompt guidelines and action. It says that the Secretary of the Interior will have 30 days in which to deal with these issues and then can have up to two 15-day extensions--a total of 60 days to do the review.

Now, while that may seem to some as a quick path, it's not when you look at the history of what has been done. Before the moratorium went into effect, it was taking 5 to 15 days to do the drilling leases and permits.

One company was done in nine days just recently. What the problem is is that most of these are simply not being done simply because of inaction. It also says for those that were approved prior to the May 27 moratorium, you've got 30 days to get them going again. This is plenty of time to do the work.

It also does something else for the first time. It provides an expedited hearing process so that legal rights are not lost--they are protected--but you will not go back into a concept of a never-ending lawsuit moratorium.

In 1230, the bill recognizes that this year will be the first time since 1958 that we have a possibility of no offshore lease sales. And it wants to reverse that action to proceed promptly with the 5-year plan so that things, for example, in Virginia will be in effect within 1 year, and those that were scheduled in the gulf can be done within 1 year of the passage of this bill.

This bill simply will create billions in Federal Reserve revenues coming in, and it will create billions in our economy, and it will create jobs.

I hate to say this, but under President Obama, the cost of energy has skyrocketed. The administration has actively blocked and delayed energy production. It's cost jobs. It's raised energy prices. It's made the United States more reliant on unstable foreign countries for our energy. Through the American Energy Initiative, this House is actively working to increase American energy production to lower gas prices, to create American jobs, to generate revenue to help reduce the deficit, and to decrease our dependence on foreign energy.

The United States Government has had a long history of sporadic attempts to respond to oil and gas prices. Usually, we have missed the mark. But, unfortunately, oil is still the lifeblood of the world and will be for most of our lives. That is why 70 countries and 31 States in the United States are involved in the process. Prices are influenced by the signals that are given by worldwide circumstances and also by government policy.

These two bills are the first of several signals that this House wants to send to the world and to the economy that says our goal should be to come as close to economic and energy self-sufficiency and independence as possible. We are not an energy-poor Nation; and we need to be developing the resources in every way possible, including in the gulf, including in the Outer Continental Shelf, and including on our land sources. That is our future if we want to do anything to create jobs and help the American people. That is specifically what these two bills are aimed to do.

With such, Mr. Speaker, this is a good rule and a fair rule; and the underlying piece of legislation is entirely worthy of our support.

I reserve the balance of my time.

Mr. Speaker, let me just make a couple of very quick points, if I could.

Once again, the purpose of these two bills is to start our process going towards Americans having adequate energy supplies to live their lives. And it's one of the things that you either increase production or you try to cut back. Our goal is to increase the production.

The idea that what we are doing is in some way making safety less significant is silly. There are new safety rules that have been in place. They are ready. They are prepared. They are ready to go forward.

The myth of subsidies to Big Oil is one of the things also that we need to talk about because even my fellow Democrats have admitted that the President's plan to push a tax hike on energy taxes does result in the loss of American jobs and higher taxes on independent oil and gas companies.

I love the fact that we always spin things by talking about Big Oil. But the nonpartisan Politifact.com noted that a majority of the U.S. oil production comes not from the biggest multinational oil companies but from independent firms. American production activities are dominated by these independent producers who drill 95 percent of the Nation's natural gas and oil wells, accounting for as much as 67 percent of the total U.S. natural gas and oil production.

Often we try to find some kind of straw man which to attack, and the idea of Big Oil is one of those easiest ones to do. But in reality, if those tax hikes were to go into place on production, you would not be hitting the Big Oil companies; you're going to be hitting small companies which have 100 or fewer employees, not only offshore, but on the shore as well. That is the attack.

I'm sorry. I am not validating President Obama's leadership on this issue. To me, leadership means you do something. Inaction is not leadership.

It's not the government picking winners and losers. What this administration is doing by the de facto moratorium, the inability to move forward on this issue is simply picking losers, losers in the field, losers for America, losers in jobs, and that is wrong.

This tries to get us going ahead in an area and in a way in which we can do it, we should do it, we have the capability of doing it. All we simply need to do is do it.

I reserve the balance of my time.

For the moment I will reserve the balance of my time and enjoy the spin.

I continue to reserve the balance of my time.

I yield 3 minutes to the gentleman from Louisiana (Mr. Fleming).

I yield the gentleman an additional 30 seconds.

I am pleased to yield 3 minutes to the gentleman from Louisiana (Mr. Scalise), who lives in this area and understands the situation firsthand.

I yield the gentleman 1 additional minute.

I am pleased to yield 2 minutes to the gentleman from Texas (Mr. Gohmert).

I am pleased to yield 2 minutes to the gentleman from Louisiana (Mr. Landry). He is a member of the Resources Committee that provides a great deal of insight from his personal background.

I yield 1 minute to the gentleman from South Carolina (Mr. Duncan), another great new member of the Resources Committee.

I yield myself the balance of my time.

Mr. Speaker, the minority is asking us to walk down a tangent issue by using negative cue words like ``subsidy,'' so let me walk down that for 30 seconds.

Please realize the U.S. oil and natural gas industry does not receive subsidized payments from the government. The word ``subsidy'' is inaccurate. Tax deductions should in no way be confused with the concept of subsidies. There are, though, tax deductions that go to all industries. Section 199, which has been talked about by the Democrats, is the domestic manufacturers'

deduction. Every industry--manufacturing, producing, growing, extracting--gets a 9 percent of earned income deduction, not a credit, except for oil and gas; but they are limited to just 6 percent. There is similarity.

They've also asked us to try and walk down a tangent in talking about safety, but the ideas of safety are codified in the legislation before us. They then say let's increase our production by raising taxes. What a non sequitur. Even if you raise taxes against somebody else and try to create some kind of straw man to attack, that is simply a non sequitur, because we do not have a tax problem in this country. We have a production problem; we have a jobs problem. These two bills go directly to that problem. They increase production and increase jobs.

We are not trying to pick winners and losers. We want the Americans to be winners, and that's what our choice is to be. These are two good bills in a time of $4 and $5 gasoline prices that are devastating jobs and our economy. These bills surely should be something that every Member should support.

Mr. Speaker, I yield back the balance of my time, and I move the previous question on the resolution.

I thank the gentleman for yielding and for his leadership on this very important issue, important in having an immediate impact on America's families.

They are feeling the pain at the pump. Our families, our workers, our small businesses, every day it gets worse for them, the price at the pump. So what can we do about it? Well, we can do a number of things, and we will, that we have been advocating for.

Of course we must increase domestic production, and there is a way to do that. But that is not all that we have to do. The American people understand that their tax dollars are going to subsidies for Big Oil. If we ended those subsidies, we could save over $30 billion for the American people.

To put it into context, my colleagues, for the first quarter of this year, the Big Five oil companies made profits of over $30 billion. Why are we, the taxpayers, subsidizing their drilling of oil when they are making huge profits, doing it in the free market?

President Obama has written to leaders in Congress asking to bring a bill to the floor to end these subsidies. I have written to Speaker Boehner asking him to do so. He has said the oil companies should pay their fair share. Mr. Ryan, the chair of the Budget Committee, has acknowledged that in his own district. And yet, in the budget that is proposed by the Republicans, Big Oil still gets a big subsidy from the taxpayer. It would mean a great deal to us, in a situation where we are saying to seniors, We are going to cut Medicare; you are going to have to pay $6,000 a year more, at a minimum, for fewer benefits because we want to cut Medicare at the same time we are giving tax cuts, big tax breaks to Big Oil.

So here we are today. Just last week, ExxonMobil reported $10.7 billion in profits during the first quarter of 2011. Over $10 billion in profits, a 69 percent jump from last year. In fact, this quarter marked some of the largest oil profits since 2008.

Democrats are introducing comprehensive legislation. Mr. Tim Bishop is going to be leading us on the previous question, which we urge our colleagues to vote ``no'' on so that we can bring up Mr. Bishop's legislation.

Much of what that does is to eliminate tax breaks for the five largest oil companies, saving over $31 billion over 10 years. Think of it. We are trying to just save $31 billion over 10 years, when the oil companies made $31 billion in profits in the first quarter of this year. That is so unfair to the taxpayer.

Legislation to ensure that oil companies are paying the royalties that are due the American taxpayer. Hold Big Oil and the industry accountable for price gouging at the pump. Use the Strategic Petroleum Reserve to increase the oil supply and combat price hikes. In addition to that, we must end the harmful speculation which Wall Street tells us accounts for a large percentage of the increase in the price at the pump.

We also will have measures that increase American energy production. It is very important. We don't disagree that we have to have production, but we do agree that we have to do other things that have a more immediate effect on the price at the pump. And we can do that. And we must invest in our clean energy future, which will reduce our dependence on foreign oil, which is a national security issue, which will enable us to create new green jobs in our country, a jobs issue which is a moral obligation we have to the American people to create jobs.

But what the Republicans are proposing today has blinders on it. It does not recognize that what it is doing does nothing to reduce the price at the pump in the short term; that there are

many other avenues that we can proceed down in addition to increasing domestic production; and that the American people need something fresher and newer on this than being sabotaged every few years about the price at the pump while we, the taxpayers, are giving subsidies to Big Oil to drill while they are making profits in the first quarter of 1 year that are almost more than what we would save for the taxpayer.

They don't need a subsidy to drill. They don't need an incentive. They have the profit motive, and it has served them well.

We in this Congress have to be thinking about the future. How do we prevent this from happening again, but also how do we have the most immediate effect on the price at the pump? Congressman Tim Bishop gives us that opportunity today, recognizing that we want to have the full diversity of energy possibilities available to us so that the American taxpayer and the American consumer are well-served.

So I urge my colleagues to vote ``no'' on the previous question, to allow Mr. Tim Bishop to bring up an initiative that he will talk about that addresses concerns of the American people that they know about, that they want to end subsidies on Big Oil, especially when we are talking about it in the context of we must cut investments in Medicare, seniors must pay more, but don't ask us to cut subsidies to Big Oil.

I urge my colleagues to vote ``no'' on the previous question.

I thank my colleague from Utah for yielding.

Mr. Speaker, I couldn't disagree more with the comments that were made by the minority leader from California. What we are talking about here are high gas prices that people are paying at the pump today and why we are in this situation. We are in this situation because of this administration's policies that have shut off the American energy supply.

This is supply and demand. Why do prices go up? Well, gee-whiz, if the President of the United States says by policy we are going to close off billions of barrels of known reserves in America, what do you think that does to prices? Do you think that actually lowers prices? Of course, as you are seeing prices skyrocket at the pump, it is because of these policies. That is why we have seen the price of gasoline more than double since Barack Obama has been in office.

So, Mr. Speaker, what we are bringing today and what this rule addresses is the ability to start opening up some of those known areas here in America, because, again, our demand continues to increase for oil here in this country, and while the President is out tilting at windmills, the prices at the pump continue to skyrocket because the President is saying run those jobs off to foreign countries, like Brazil.

He is bragging that he wants to create more energy jobs in Brazil. We are saying, Mr. President, we have thousands of jobs here in America that we can create today. We have got billions of dollars that are being sent to foreign countries, many of whom don't like us, by the way. We can bring those dollars back. And, by the way, that can also help us pay down the national debt that is out of control right now. And that is what this bill addresses.

And what's their answer on the other side? The President is talking about raising taxes on American energy, and the minority leader from California just emphasized it. She talked about a $30 billion tax increase on American energy production. You want to talk about a warped policy? Look at what their plan is.

We're saying let's open up supply. Let's create jobs in America. I have seen it in south Louisiana. We have lost over 13,000 jobs in the energy industry just because of the President's policies in the last year, where he shut down production and said you can't go back to work drilling safely for known oil in America. But he wants to run those jobs off to foreign countries. So that is what is happening.

We saw one of the deepwater rigs go to Egypt just in the last few months. So an employer is saying, I want to take a thousand jobs and it's better to do business in Egypt because of these radical American policies on energy right now. So we are trying to turn that around and say let's actually explore for energy here in America, creating thousands more jobs in America and bringing in billions more dollars that pay down our deficit.

Their answer is raise $30 billion in taxes and, you know, go talk about Big Oil. Big Oil is not going to pay that. Big Oil is leaving. They are going to foreign countries. It is our local energy producers here in America who will pay that tax. And you know what that ends up equating to? That means higher prices at the pump, $30 billion in higher prices at the pump, because of their policy.

And they're bragging about it. They're saying, let's raise taxes on American energy. By the way, their bill doesn't apply to energy that is produced in Saudi Arabia. So what do you think is going to happen?

Now more oil is going to be coming in from Saudi Arabia because of their policies.

We have got to reverse this radical approach and actually create jobs in America, create energy in America and bring down the skyrocketing price of gasoline at the pump, and it can all be accomplished with this legislation here today that I strongly support.

I thank the gentleman, Mr. Bishop.

I am from Louisiana, and of course these leasing issues, the issues of drilling and oil production are very important to my State. And certainly any issue with regard to oil spills affects my State the most in the last year or so because of the Deepwater Horizon.

But here is the point I want to make: The President has said that oil production in the United States and offshore in the gulf is the highest it has ever been. When I asked Secretary Salazar in the Natural Resources Committee, he said the same thing. Then I asked Mr. Bromwich and he gave the same answer.

The truth is, Mr. Speaker, that the oil production off the Gulf of Mexico peaked at 1.7 million barrels a day. It is now down to 1.5 million barrels a day, and in the next year it will decrease by another 225,000 barrels a day. And even if we restore drilling permits at the level they have been previously, it will continue to decline over the next several years.

So I think we can ill afford, Mr. Speaker, at a time when our gas prices continue to go up, to continue this activity that we have, this ruse, where we have a slowatorium off the Gulf of Mexico.

I think we are up to about 12 permits in the deep water at this point. And I was speaking with the gentleman, an expert on this, yesterday. He said that we normally pace about 40 or 50 permits a year. So that means that we are at a fraction of what the actual permitting process would normally be in the best of times.

Now, some would say, well, we haven't proven that it is safe. Well, if that is true, why is the administration releasing permits? Obviously that is proof that the administration is comfortable that we can again drill in the deep water off the Gulf of Mexico.

So I say today that with America being at gas prices that will soon approach $5 a gallon and the USGS now saying that we now have more coal, natural gas, and oil than we have ever thought we would have, really more than any other country in the world, including Russia, and many more times than what Saudi Arabia has, 1.3 trillion barrels of oil equivalent if you add coal, natural gas, and oil, why in the world are we pulling back on the exploration and production of these vital resources that we have?

I thank the gentleman.

I will say in summary, I am from the Fourth District of Louisiana where we have a veritable Saudi Arabia of natural gas in my district, the most natural gas in North America and the fourth largest deposit in the world, and we didn't even know about it 4 years ago. That just goes to show you how new technologies in the area of exploration and development are creating many more resources than we ever thought we had, and it will help stabilize our prices.

So I ask that we pass this bill today and that we finally get this country back onto stable footing.