Floor Statements

Mr. President, it is fascinating to come out here and listen to false choices. Let me describe this issue of find more, drill more. I am for drilling. I am for everything. But that is yesterday forever. It is the same folks who every 10 years show up and say: Let's keep doing what we have been doing, that sure is good, except the hole keeps getting deeper. If we don't have something that is game changing, 10 years from now they will be back talking about ``find more.''

The false choice is this: This chart shows the National Petroleum Reserve Alaska. We have made all 23 million acres of it available for drilling. Only 3.8 million acres have been leased. There is more oil in the National Petroleum Reserve Alaska than exists in ANWR. An estimated 9 million barrels of oil and 60 trillion cubic feet of natural gas are available in the National Petroleum Reserve Alaska. Yet some policymakers trot out their little horn ornament called ANWR and say: You have to agree to drill in ANWR or you are not for drilling.

How about this? How about this 23 million acres? It is a canard and false choice to come out and suggest that somehow, as my colleague said, Democrats are against drilling. That is absurd. It is just not the case.

What we need to be for, it seems to me, is something that is game changing, something that says let's not be in this same position 10 years from now. John F. Kennedy didn't say let's try to go to the Moon or I would like to think about going to the Moon or maybe we will make an effort to go to the Moon. He said: We are going to put a man on the Moon by the end of a decade.

That is what we ought to do with respect to the change in energy policy. You will get no change from those who come to the floor of the Senate and say let's keep doing what we have been doing even though the hole is getting deeper.

Here is what is happening. We need to do first things first. The first hurdle in front of us is to shut down the dramatic speculation on the oil futures market. Speculators were 37 percent of the people in the oil futures market in the year 2000. Now oil speculators are 71 percent of the market. They have broken the market. There is nothing my colleagues can point to in the last 12 months that happened in supply and demand that would justify a doubling of the price of oil--nothing. Yet, interestingly enough, 47 Members of the other side of the aisle have said speculation is at least part of the problem. In fact, there is a provision on speculation in the bill of Senator McConnell, the minority leader's bill that was offered in the Senate.

If 47 of them believe speculation is part of the problem, let's at least address that first. It seems to me if you are running the hurdles, you jump the hurdles in front of you. Why not do this first, even as we work on a wide range of other issues as described by my colleague, Senator Bingaman? We are drilling, and we should continue to drill in a responsible way in certain areas of the country.

I was one of four Senators who helped open lease 181 in the Gulf of Mexico. It was a big fight. Guess what. It has been open now for a couple of years, and there is not one drilling rig on it because the oil folks aren't there. Yet they send folks to the floor of the Senate to say we need to get Democrats to allow us to drill more. There are 8 million acres we opened in the Gulf of Mexico. There is substantial new oil and gas available on those 8 million acres. Yet they are not there drilling. Why?

The entire master narrative in this debate in the Senate is the minority wanting to say somehow the majority doesn't support drilling. It is a false choice, and they know it.

The question is this: Will they support shutting down the excessive relentless speculation in the oil futures markets? Will they support that? Are they going to stand on the side of the oil speculators and say we kind of like what is going on; we like seeing the price of oil double in a year?

Let me point out again that there is nothing that has happened in supply and demand that would remotely justify the doubling of the price of oil in a year. Yet they come to the floor with their charts and say: Produce more.

I am for producing more. It is a false choice to suggest they support producing more and we do not. But the question is, what are you going to do to deal with the problem today? Then, what are you going to do as we go forward to suggest something that is really game changing, that allows us to be free and escape from the need to rely on Saudis to ship us oil?

My colleague just described a quote from T. Boone Pickens. He must have forgotten the quote from R. Boone Pickens that says: You can't drill your way out of this mess. You can't drill your way out of this. What we need to decide as a country is we are not going to have to go begging for oil from the Saudis, from Venezuela, Iraq, and elsewhere because we have changed our energy mix.

So if 47 members of the minority have talked about speculation being a problem, perhaps we can at least address this first issue. Then we should work on the wide range of other things--substantial conservation; substantial new initiatives with respect to energy efficiency; yes, more production; and most important, dramatic moves toward renewable energy: wind energy, solar, geothermal, biomass.

It is long past the time for this country to decide we are going to change our energy mix. How are you ever going to get to hydrogen fuel cell vehicles--or, in the interim, to electric vehicles--if you do not get serious about deciding we are going to change our energy future? If you want to be yesterday forever, God bless you, but don't count me among you. I don't want to be here 10 years from now--I don't know that I would be--but I don't want to be here every single decade to see the same folks coming to the Senate floor to say let's keep digging the same hole. How? Just because drilling is the only answer.

Mr. President, how much time have I consumed?

I yield the floor.

Mr. President, there is an old saying that when all is said and done, in most cases, more is actually said than done. Perhaps that applies best to this debate.

Should we resolve our energy problems and make us less dependent on the Saudis, Iraqis, and Venezuelans? Of course. Are we too dependent on foreign oil? You bet. Up to 70 percent of our oil comes from outside this country. Are we addicted to oil, as President Bush has suggested? Of course. How do you deal with the addiction to oil? Well, every 10 years, our colleagues come to the floor and say let's drill more holes, bigger holes, deeper holes.

Do you know what? The debate is all about false choices. The suggestion has been made that people on this side of the Senate Chamber don't want to produce anymore. That is absurd, and they know it. That is what we insist because that is the narrative they have created for this issue. They don't want to do what needs doing, so they want to create a series of false choices.

Let me describe the issue of drilling. Drill more. Well, I support drilling

more. I worked with several others in this Chamber to open lease 181 in the Gulf of Mexico. I was one of four Senators who began that process. There is 8.3 million acres in the Gulf of Mexico that has been open for 2 years. There is no oil activity on it right now, despite the fact there are proven reserves of oil and natural gas.

This is a map of Alaska, and this is the National Petroleum Reserve Alaska, NPRA. This happens to be 23 million acres, 20 million of which aren't even leased yet. But they are all open for production. We supported that. Here is a place you can drill. There is more oil here than there is in Arctic National Wildlife Refuge, which has become the hood ornament for their argument. So why aren't we drilling in the NPRA? It is open.

Many Republicans say that Democrats don't support drilling. In my home State, we have the Bakken shale, a seam 10,000 feet down. We have 75 drilling rigs producing oil, drilling for oil in the Bakken shale, just in western North Dakota. There is similar activity in eastern Montana. A U.S. Geological Survey finished the assessment, and it is the largest contiguous assessment in the history of the lower 48 States. They released that 3 months ago at my request. There are up to 3.65 billion barrels of recoverable oil. We are drilling there right now. Don't tell me we are not for drilling. I am for more drilling. I am for much more conservation, energy efficiency, and renewable energy production. I am for all those things, but it seems to me you ought to do first things first.

We have a broken market called the oil futures market. It is a commodities market with which producers and consumers can hedge risks of a physical commodity, but it is now broken. It was created in 1936. The law that creates it has a provision called ``excess speculation,'' because they were worried about excess speculation. When Franklin Delano Roosevelt signed the bill creating the oil futures market, he warned about excess speculation. Well, here we are. The speculators have taken over this market. If you wonder if that is the case, I will show you the result of a House of Representatives investigation. In 2000, 37 percent of the trades on the oil futures market were speculators. Now in 2008, it is 71 percent. They have completely taken over that market.

To my colleagues who say ``supply and demand''--and said:

. . . I wonder, why do people think that the American

people are so dumb they don't understand supply and demand?

He misunderstands. The American people aren't dumb at all. They get it. They are sick and tired of driving to the gas pump and paying these prices. They are sick and tired of seeing the price of oil double in one year, and then they look at supply and demand and realize nothing has happened in supply and demand to justify it--nothing.

I have asked the question: Will someone come to the floor of the Senate and describe to me what happened in supply and demand that justifies a doubling of the price of oil and gas in a year? They never do because they can't. The Secretary of Energy can't. The head of the Commodity Futures Trading Commission can't. Despite the fact both of them repeatedly have said what is happening with the price of oil and gas is the fundamentals of supply and demand. Oh, really? Where? Describe it to me. Nothing has happened in the fundamentals of supply and demand that justifies doubling the price in the last year. What has happened is brain dead regulators, who are supposed to be wearing the striped shirts, the referees that are supposed to call the fouls, have sat back and said: Do whatever you want to do, have a good time, have a party, a carnival.

Speculators have taken over the market. There is a very important reason to have a futures market. It is to allow legitimate hedging of risk between producers and consumers of a physical product. This market became something much different than that. The regulators have said we will issue no-action letters so we don't have that to see. We are willfully blind and deaf and don't care very much what is going on. I know they will deny that, but that is the fact.

So you have a regulatory body that doesn't regulate, a market that is broken, and then we have folks waltz in here and thumb their suspenders and say: You know, we cannot be talking about speculation because there is no speculation. We have had testimony before our committees by some pretty good people who say that as much as 20, 30, up to 40 percent of the current price is due to rampant, relentless speculation.

Let me describe it from the standpoint of Mr. Fadel Gheit. I have talked to him by phone. He testified before the committee. This is a man who worked, for 30 to 35 years, as a top energy analyst for Oppenheimer & Company. He said this last fall:

There is absolutely no shortage of oil. I am convinced that

oil prices should not be a dime above $55 a barrel.

I call it the world's largest gambling hall. It's open 24/7

and totally unregulated. It is like a highway with no cops

and no speed limit, and everybody is going 120 miles an hour.

So we bring a bill to the Senate that says let's establish a distinction between those who are legitimately hedging--that is trading for legitimate hedging purposes and all others. All the others will be subject to strong position limits to try to wring the speculation out of the system. It is a reasonable thing to do, in my judgment.

My colleagues come to the floor of the Senate and say: No, let's go for more drilling. That is their narrative. I say, OK, let's do drilling. How about in the National Petroleum Reserve? We set aside 23 million acres there, and only 3 million have been leased. Let's do that. In lease 181, there are 8.3 million acres available. There is plenty available if you want to do drilling. Even as we do that, how about helping us get rid of the speculation in the marketplace and restore this market to what it was intended to do. Do you choose to stand on the side, when somebody says whose side are you on? They say: Let us think about that. We are going to be on the side of the oil speculators. Really? Or I am going to be on the side of those who don't want us to become less dependent upon the Saudis. It is fine if $500 billion, $600 billion or $700 billion a year is sent outside our country in pursuit of oil. That is OK. That will not weaken our country.

We all know better than that. We don't need an overnight epiphany to understand what is happening to our country. These relentless price increases and the unbelievable dependence we have on foreign sources of oil are injuring this country. Every consumer in this country is damaged almost every day. Which airline next will declare bankruptcy or liquidate? How many trucking companies aren't in business anymore? Ask farmers what it is going to cost when they try to fill their tanks with a load of fuel. Then can you conclude this doesn't matter? You cannot conclude that. We ought to be here debating what to do. It ought to be obvious. I have said before, if you are running the high hurdles, you have to decide to jump the first hurdle in front of you. The first hurdle, it seems to me, is to address this relentless speculation and put downward pressure on gas and oil, on prices.

Let me describe what our Energy Information Administration said. They said there is no question about speculation. The only way you can conclude this is not speculation is to look at this chart and not see it. On this chart, here is the price of oil. It is kind of like a Roman candle on the Fourth of July. Here is what our Energy Information Administration told us. We spend about $100 million a year for this agency, which has the best and the brightest, to evaluate supply and demand and come up with this. I put this chart together because I want everybody to see how wrong they have been and conclude why.

Take November of last year. They said this would happen to the price of oil. Then, in January of last year, they said the line will look like this. In March of this year, they said it is going to look like this. You can go back to May of last year, a year ago. Obviously, this isn't where the price went. It went up like this. Is that because the people estimating it were stupid, maybe didn't sleep well, didn't finish school, or had no common sense? That is not why. They didn't understand this is not about supply and demand any longer.

This is about a speculative binge that is driving up the price of oil in a manner that is completely disconnected

with supply and demand. I understand we have people talking about that, and I understand the world is changing. I understand the Chinese want to drive cars and people from India want to drive automobiles. I understand there will be maybe 300 million, 400 million, to 500 million more cars on the road 10, 20, 30 years from now. I understand that. But that hasn't changed significantly in the last 12 months. There is nothing that changed with the estimate of future demands in the last 12 months that justifies this line.

That is why we bring a bill to the floor of the Senate that says let's at least agree, on a bipartisan basis, to do first things first. Then you say, well, we need to support drilling, conservation, energy efficiency, and more renewables. You bet your life--although, I would say many of those who have spoken on the other side are not quite so enthusiastic about the other side of energy that is renewables and conservation and energy efficiency.

We have many airlines in this country. Obviously, that industry is one of the heaviest users of jet fuel. We have had seven bankruptcies recently. They have said it means thousands less jobs. Normal market forces are being amplified by poorly regulated market speculation. The Nation needs to pull together to reform the oil markets and solve this growing problem. That is from the airline industry. You probably saw the newspaper yesterday--and this is not unusual--``Jet Fuel Costs Push Midwest Air to End Flights to 11 Cities.'' It is happening across the country. I would understand this if, in fact, this was a circumstance where supply and demand had changed in a radical way, and we would decide in this country that, you know what, we have to confront supply and demand. We have to do that in the longer term. But that is not what this is about.

I said earlier today, in my judgment, the drill now--and I am for drilling now, so let me be clear--the drill now mantra is a yesterday forever strategy. It is good that every 10 years they come to the floor and say the solution to our energy issues is to drill now. If yesterday forever is comfortable for you, good for you. I don't think it is a good policy. I think we need to use this circumstance at this intersection and say we are going to fundamentally change America's energy future. We can do that. John F. Kennedy didn't wake up one day and say: I am going to give a speech and say I think America is going to put a person on the Moon, or I hope that perhaps someday we can put a person on the Moon. He could have said we are going to try to see if we can get someone to walk on the Moon. That is not what he said. John F. Kennedy said:

By the end of this decade, we are going to have a man

walking on the Moon.

He just declared it. That is our goal, what we are going to do. This would be an awfully important intersection for us to decide, after we take care of this excessive speculation to set the market right, that we should do a lot of things--and conservation is the cheapest and most obvious option. The other thing we ought to do is do some change. We ought to decide that in the next 10 years we are heading toward hydrogen fuel cell vehicles. Maybe between now and then, we will move quickly toward electric-drive vehicles. We are going to have a completely different future with substantial new wind energy, solar energy, and geothermal energy development. We are going to build a superhighway transmission system, just as President Dwight Eisenhower did with the interstate system. That way we can use the wind belt from Texas to North Dakota and the Sunbelt across the Southwest can displace significant portions that we currently get from fossil fuels for electricity. We can do all of that, but only if we start pulling together as a country.

I have watched this debate this afternoon. It is the most disappointing debate because we have people coming to the floor of the Senate who are the ``just say no'' crowd. Just say no. No matter the question, just say no and then develop some little narrative that allows you to say no and make people think you are saying yes.

How about this issue? The market is broken. It has resulted in the doubling of oil and gas prices in the past year, and there is no justification in fundamentals of supply and demand to make that happen. How about having us pull together and say: Let's fix the broken market and put downward pressure on oil and gas prices. Don't use something else as an excuse. When you talk about something else, I am going to say: I am with you on that; I think we ought to do a lot of everything. Don't use that as an excuse to do nothing here, but let's at least do first things first.

There is plenty of reason for the American people to be disappointed in what they hear from their Government. It is so frustrating to be here and understand what needs to be done and yet does not get done because we have people who believe they were born to be a set of human brake pads and stop everything at all times.

On a number of occasions, I have described on the floor what we have done. Think for a moment. We split the atom. We spliced genes. We cloned animals. We invented plastics. We invented radar. We invented the silicone chip. We invented the telephone, the computer, and television. We decided to build an airplane and learn to fly it. We build rockets. We walked on the Moon. We cured smallpox. We cured polio.

It is unbelievable what this country accomplishes. Yet, somehow we decide what we should do is continue a strategy of being dependent, for 60 or 70 percent of the oil we need to run America's economy, certain oil producing countries like Saudi Arabia, Kuwait, Iraq, and Venezuela. I am sorry, I think that policy is nuts.

This country needs to mobilize and pull together. This is not about Republicans or Democrats. It is about a game-changing strategy that says: Here is where we have been, and right now, we can't go there in the future. We need a different kind of energy future.

My point is just to do first things first. The first thing on the floor of the Senate is about speculation. Mr. President, 47 Members of the other side have indicated in one form or another, through one comment or another, in their home state or here in the Senate, that speculation is a part of the problem. If that is true, and I believe every Member on this side of the Chamber believes that, that ought to add up to 97 Senators. I don't know who the three others are who apparently have not voiced an opinion, but we ought to be able to pass legislation that fixes a broken futures market.

Just as quickly, we ought to be able to agree on a wide range of other issues. Yes, we should include some drilling in areas that are open and not being drilled on. We should also look more aggressively at conservation and energy efficiency and make a dramatic change to renewable energy in the longer term. We ought to be able to do that. The American people should expect that of us, and we ought to be able to meet that expectation.

I know others are going to come to speak this evening.

Just so the American people understand, we agreed to a cloture motion on a motion to proceed. That means we voted to shut off debate, not on this legislation but on whether we should proceed to the legislation. So we had that vote, and now the minority is saying to us: No, you cannot proceed to the bill; you need to speak for 30 hours.

There is a 30-hour requirement. Usually, it is waived back, but in recent times, on everything, it has been required. So now, for the next 30 hours, we will have people obfuscate; thumb their suspenders; wear blue suits on the Senate floor; and talk about this, that, and the other. We are not making progress because the minority is saying we have to spend 30 hours before we can even get to the bill of which I have been speaking. It is an unbelievable procedure. In most cases, cooperation would simply suggest that we work together. Unfortunately, there is a big, growing problem that is hurting this country. Yet if we work together and find a way to fix it, then it makes a lot of sense to me.

I am someone who is respectful of other opinions, but in this case, I think there is a mountain of evidence that should lead us to fix this market and put some downward pressure on oil and gas prices. Following that, we can, in a matter of days, it seems to me, work on a wide range of other issues that deal with all of the issues I just described. We can put America in a much better place if we decide to do that.

Mr. President, I yield the floor. I suggest the absence of a quorum.

Mr. President, I ask unanimous consent to speak in morning business for 20 minutes.

Mr. President, this is a very important subject. My colleague from Arizona speaks of the issue of energy. The price of gasoline is skyrocketing. The price of oil has doubled in a year. It has an impact on everything and everybody in this country. It is important as we discuss this issue, however, that we not create false choices.

It is a false choice for anybody to suggest that, because we do one thing, we cannot do another. It is a false choice to suggest that because we take the first needed step, we are ignoring subsequent steps. We ought to do a lot of things here.

I mentioned yesterday that we had a witness come to a hearing and describe this situation. If you have someone being hauled into a hospital emergency room who is grossly obese and also suffering a heart attack, do you think some doctor who meets the gurney at the emergency room is going to look at this grossly obese person suffering a heart attack and say: All right, let's start working on a diet. We have to work on this obesity. No, of course not. He will say: Let's take emergency action to deal with the heart attack.

Now, my point is this: We have very serious energy problems. One part of it is a gross amount of excess speculation in the commodity market that has driven up--actually doubled--the price of crude oil in the past year, for which there is no justification in the supply and demand of the commodity. It seems to me, at least as a first step, we ought to address this excess speculation.

My colleagues then say you have to drill. I don't disagree with that. In 2006, I was one of four Senators who cosponsored the legislation that resulted in the law that opened lease 181 for oil and natural gas production. This is 8.3 million acres in a portion of the eastern Gulf of Mexico that is now open for drilling. Senators Bingaman, Domenici, Talent, and I were the people who first introduced that bill. It is now law. So that is fine.

But if the only answer is to drill then I would ask those who say that, how many airlines do you think will be serving this country if we wait for 5 or 7 years until somebody gets all the permits, undertakes the testing, builds a drilling rig up in an area and pumps new oil out of the ground? How many airlines will be serving this country? I tell you, a number of them have already gone bankrupt. Several are out of business, and others will follow quickly. How many small-mom-and-pop trucking firms that can't afford to pay for the diesel in their saddle tanks are going to be out of business in the next 5 or 7 years before this notion of drilling, which is going to produce the additional supply they are talking about, will be effective? How many fewer farmers are going to be around? How many people will be around trying to figure out: How on Earth do I afford to fill my gas tank in my car in order to get to work next week because I don't have the money for the gas?

My point is, we need to do a lot of things. Yes, we need to produce more, and we need much greater conservation. By far, the most effective achievement of additional oil production is to save a barrel of oil. We are such prodigious wasters of oil and energy in this country. It is unbelievable. There is so much to be gained by conservation and energy efficiency. In everything we use from our lights, better doors and windows, insulation, virtually every appliance, hot water heaters, refrigerators, and stoves, conservation and energy efficiency are a very significant part of this issue.

So, too, is a renewable energy future. We need game-changing approaches. I want to go from here to 10 years from now in a game- changing way that says: I don't want us 10 years from today to be so dependent on Saudi oil. My colleagues, all they talk about is drilling. I am for drilling. But if that is all you are for, that is a yesterday forever strategy. Good for you. But every 10 or 20 years you are going to have exactly the same debate--drill more. You are not going to change this country's energy future at all.

So my proposition is this: How about working together on steps, a step at a time, doing a lot of things and doing them right. How about the first step? We just had testimony this morning in the Energy Committee from someone that cited a recent report from the CFTC which indicated that more than 73 percent of those trading in the commodity futures market have nothing at all to do with hedging a physical commodity. That is not what they are interested in. They are speculators. He called them investors, but they are speculators. In fact, he said speculators. He said I actually called them investors.

But if 73 percent of that market for the oil futures is now devoid of people who are actually trying to hedge a physical product between consumers and producers, then that market is broken. That market has gone far afield of what it was created to do.

The market was created in 1936. When it was created, Franklin Delano Roosevelt warned about excess speculation when he signed the bill. And the bill itself had a provision dealing with excess speculation because of concern that speculators could take over a market and ruin the market.

The proposition is this: What has happened in the last 14 months that has allowed that market to price oil to double in price? What has happened with respect to the fundamentals of oil supply and demand that would justify that? The answer is: Nothing. Nothing. It has been pure, relentless, excess speculation moving massive quantities of money into this marketplace speculating on crude oil futures.

I have mentioned many times the description of Will Rogers about speculation because it is not new to America. It happens. When it happens and markets are broken, we have a responsibility to take some action. Will Rogers described it as someone buying things they will never get from people who never had it. You can add, in this day and age, with money they don't possess.

So what we had is unbelievable excess speculation in the marketplace. There are some who scoff and say that is not happening. One of my colleagues this morning said what is happening is supply and demand. Well, I ask my colleagues to come to the floor and describe to me the events that have occurred in the last 14 months or so that would justify doubling the price of gasoline or oil. They will not come to the floor because they can't. The knowledge of the significant change in supply and demand in the last 14 months does not exist.

This is not about supply-and-demand fundamentals. Go back 2 or 3 years and ask yourself: What do we know about the desire of the Chinese or Indians to drive more cars? What do we know about all those factors that might, in the longer term, increase demand for gasoline or diesel? Did we not know them a year ago? Is that new knowledge? Not at all.

The fact is, nobody is going to come to this Chamber and tell us there is something that has happened to supply and demand that justifies the doubling of the price of gasoline and oil because it does not exist. This doubling existed because, in my judgment, of excessive, reckless speculation in the futures markets for oil. We have a responsibility to do something about it.

Now, the legislation that we introduced yesterday is the Stop Excessive Energy Speculation Act of 2008. Let me say that again: Stop Excessive Energy Speculation Act of 2008. I worked with Senator Reid and others on the legislation. It is not brought here, as my colleague from Arizona just suggested, to

do this and nothing else. That is a false choice, and it is being presented on the floor of the Senate every chance they get. If we do this, it means we don't want to do anything else. I say let's do this and everything else.

Now, I am not suggesting, as some perhaps would, that we drill in the Grand Canyon or drill in the Everglades. There are certain areas where we ought not drill. We have a substantial amount of area that is available for drilling. And when they say: Well, we are not drilling. Why don't you go north of Kidder, ND, and take a look at a rig right now. We have about 70 to 80 of them in North Dakota, and they are drilling right now in something called the Bakken shale.

Some may not understand, but in the last 2 months, the U.S. Geological Survey put out an assessment that said the Bakken region has the largest assessment of recoverable oil ever recorded in the lower 48 States. This is 3.6 billion barrels to 4.3 billion technically recoverable barrels, and they are pulling oil out of that formation. There are drilling rigs all over western North Dakota and eastern Montana.

So when someone suggests we are not drilling, that's nonsense. Get a car and drive around a little. I will show you where the rigs are. We are drilling onshore and offshore. We have, in fact, opened lease 181, a portion of the Gulf of Mexico that was not previously opened until 2006. We don't see a lot of activity there at the moment, but we did that because there are substantial oil and gas reserves there.

I will make one additional point. There are a half million barrels that can be potentially produced off the coast of Cuba. Spain, Canada, India, and others are interested. But U.S.-based companies are not able to get involved in leasing off the coast of Cuba because we have an embargo against Cuba, among other things. President Bush doesn't want us to be involved in this region.

So it is not a case where those who come to the floor suggesting that we drill, drill, drill, would want us to drill everywhere. In fact, the legislation they brought to the floor of the Senate that touts drilling conveniently left out a substantial portion of the eastern Gulf of Mexico because a Member on their side doesn't support that. So they left that out of their proposal. Oh well. I guess one doesn't have to be consistent to come to the floor to make presentations.

The issue is this: Let's do something together because this country's economy is being damaged. American families are being injured, and farmers, truckers, and airlines are getting killed with these prices. Let's do something together to address it.

What would make sense? What is the first step, or at least a sensible first step? Does it make sense to say let's do something that will provide some relief in 7 years? That will be great to tell Aunt Millie: I know you won't be able to pay your fuel bill this winter, but 7 years from now, just wait, we will have another field in production someplace.

What about taking first steps first? What about stopping excessive energy speculation with the bill we introduced yesterday? Now, how does the bill do that? It requires the Commodity Futures Trading Commission, which has been a regulatory agency that I have had fairly strong words about recently, to actually stand up, put on striped shirts, blow the whistles and be the referees for this marketplace. They have been an abysmal failure, in my judgment. They have an acting chairman, who says: What, me worry? The only thing going on here is the market demands and the fundamentals are working. It is just supply and demand.

In fact, the Commodity Futures Trading Commission has been issuing over the years what are called ``no action letters.'' Boy, that is a fitting tribute to this agency--no action letters--that have said, essentially: We are not interested in seeing what is going on. In fact, we will be willfully blind to what is going on, and here is a letter that demonstrates we are interested in that position.

So what we say in the bill is: Look, there is a regulatory agency here, and we believe it ought to function and we require it to function in a certain way. No. 1, we say it ought to distinguish between groups of traders. There are those who are hedging their risk, the consumers and producers of a physical product, because that is the purpose for which this market was established and all others. All the others are speculators.

And this bill would impose substantial position limits on what are the nonlegitimate hedge trading transactions. Again, very specific. Within 30 days, we would require the regulator to impose very specific and strong position limits on all non-legitimate hedge trading. What that does is to take some of the air out of this balloon and put some downward pressure on oil and gas prices.

Now, I have shown this chart many times, but it is worth going over some of the things we have heard here in the Congress, and it is worth it because of those who come to the floor to say: What speculation? There is no speculation.

I had Fidel Gheit, an interesting guy, testify in front of our committee before, and I have talked to him by phone, and here is what he says:

There is no shortage of oil. I'm convinced oil prices

shouldn't be a dime above $55 a barrel.

And he said, talking of the futures market:

I call it the world's largest gambling hall. It is open 24/

7. Unfortunately, it's totally unregulated. It's like a

highway with no cops and no speed limits and everybody going

120 miles an hour.

Energy Secretary Bodman, who is one of these people who says there is nothing going on with respect to these marketplaces and this speculation, says:

There is no evidence that we can find that speculators are

driving futures prices for oil.

He says he can't find the evidence. Well, let me find evidence that indicates the opposite. Here are at least two examples. First, the House Subcommittee on Oversight and Investigations released a report showing that speculators in the oil futures market went from 37 percent to 71 percent. It seems to me that is some pretty substantial evidence. Second, testimony this morning before the Energy Committee revealed that speculators represented 73 percent of the market--almost identical.

So I would say to the Secretary: If you can't find the evidence, I can. If you have the right evidence, maybe you could search for the right solution.

Our Energy Information Administration--the EIA--doesn't do anything with respect to policy. We spend $100 million for this agency, and it is supposed to simply provide the best information available. Here is the information they have provided: In May 2007, they said here is where we think the price of oil will be--right across here, about a straight line. In July 2007, they said: Here is where the price of oil will be. In September 2007 and in November 2007, they said here is what we think. Now, in March 2008, here is where we think it will be.

Well, guess what. These lines were so far off, I mean it is almost laughable. Here is where the price of oil went. Why is that? I assume these folks were taking a look at supply and demand and the normal relationship that determines a price, and they didn't understand that what has happened is that this market is perverted and broken as a result of excess speculation. The price went just like a Roman candle.

There is no way to describe this as anything that is rational. We are not off not by a mile, but by a country mile.

I had a hearing on this subject. Of course they couldn't answer the question of why they were off so far.

The senior vice president of ExxonMobil:

The price of oil should be about $50 to $55 per barrel.

The same with the president of Marathon Oil, same answer.

My sense is that we ought to do everything, but we have folks coming to the floor of the Senate to say: You can't do anything unless you do drilling first.

We are doing drilling right now, but we will not allow you to do anything unless you do something that is going to affect something 5 or 7 years from now.

It doesn't make much sense to me. It seems to me, if this is an opportunity to move forward, you address the hurdles that are in front of you. The first hurdle, it seems to me, is to set this market straight. I believe the market we have with respect to the futures

market is broken. There is reason to debate that. I respect those who disagree, but I think the evidence is not on their side.

What I think we should do is decide we have a very serious problem, and we should address it three steps. The first step would be to tackle this speculation issue. We introduced that legislation last Tuesday. That legislation brings everything under the control of the Commodity Futures Trading Commission so they can see all of it, including the over-the-counter trades on foreign exchanges. It requires strong position limits. The fact is, it requires that a distinction be developed between legitimate hedgers and just pure speculators. We should do that. So that is step No. 1.

Step No. 2, it seems to me we should develop a broader position with the six or eight things we need to do as a country in a much more aggressive way that increases additional production, conservation, and energy efficiency measures because all of these opportunities in the future.

For step three, we ought to do something that is game changing because we come here every 10 years or so, every 20 years, and the drillers come in and say: The only way to solve our energy problem is to drill. As I said, that is a yesterday forever policy. That is fine if you are comfortable coming back to the same debate and putting our country in the same position. But the game-changing approach, in my judgment, is to say there are a lot of ways for us to develop renewable sources of energy, a lot of ways for us to develop renewable sources of energy in a way that really changes our energy future significantly.

Those are the three things I think we ought to do and do them in that order and fairly close order, and I believe we ought to do it understanding that this is an emergency.

If all we do is just to deny that this market is broken and deny that there is excess speculation, then we will just be talking past each other. If that is all we do, I wonder how many airlines will be left in this country 5 or 7 years from now, if that is the time period in which maybe you get some additional drilling up and get some additional production? How many trucking firms are going to be operating out there? How many mom-and-pop firms go belly-up in the next 6 months or year or 2 years? How will the folks who are trying to fill their tanks and figure out how they are going to pay gas prices go to work? How will they fill that tank to get to work next week or next month or next year?

I think there is an urgency. One of the things to respond to with respect to that urgency is the first challenge in front of us. That urgency is to set straight the excess speculation in this marketplace. We can do that. There is nothing Republican or Democratic about that. It is just to look at this with a level head and say: Here is a problem, let's address it. The underlying law that created the futures market was created in 1936. It has a provision dealing with excess speculation.

I will make one final point. The regulatory authority here has been an abysmal failure, but that is not just in this case. We face a lot of challenges today. We face challenges with respect to banking. We face challenges with respect to the subprime scandal and a whole range of other things, and you can trace it right back to the root that so many people felt regulation was a four-letter word. They decided we want to have regulators who decided not to regulate. That is certainly the case with this market. It is the case with other issues as well.

I think we have a Congress that has the responsibility and opportunity to set it straight.

I yield the floor.

Mr. President, how much time remains on this side?

Mr. President, I ask unanimous consent to add 5 minutes to our side and 5 minutes to the Republican side.

Mr. President, my colleague, Senator Bingaman, the chairman of the Energy Committee, was talking about a very important subject. Almost no American at this point can escape the consequences of what is happening with respect to our energy markets: the cost of gasoline, the cost of oil, its impact on drivers, its impact on truckers, airlines, and farmers. It is pretty unbelievable.

I have come to the floor today to talk about a bill that was introduced last evening, S. 3268, by the majority leader, Senator Reid. I have been working with Senator Reid--and many others have worked with him as well--to construct a piece of legislation dealing with excess energy speculation. I am convinced that dealing with excess speculation will put downward pressure on oil and gas prices.

Now, I introduced a piece of legislation in June called the End Oil Speculation Act of 2008. I have also been speaking on the issue of excess speculation in the energy markets for several months on the floor of the Senate. I have been very pleased to work with Senator Reid and others, and I am pleased with the result of the piece of legislation Senator Reid has introduced with my cosponsorship and others. It embodies most of that which was included in the legislation I had previously introduced in the Senate.

I wish to talk about why this is important. Now, I understand there are some people who scoff at this saying: Well, do you know what, there is no excess speculation. If we are going to deal with the energy issue, we have to drill, drill, drill.

We can drill. I support drilling. But the fact is, you can put a drill bit in the ground today, and you are not going to do one thing with respect to gas and oil prices. That is 2 years, 5 years, 10 years off. The question is, What do you do about what is happening today with excess speculation in these markets?

Now, excess speculation is not new. It has happened in other markets, and it sometimes breaks the market. When the market is broken, there is a responsibility, in my judgment, to take action.

So let me describe what I think we face. I also want to talk for a moment about this new piece of legislation we introduced last evening, which I fully support. I am sure waves of opponents will come to the floor and certainly come to offices around this Capitol Building and try to defeat it.

First of all, I have shown this many times: Fadel Gheit has testified before our Energy Committee. For 30 years, Mr. Gheit has been a top energy analyst with Oppenheimer & Co. Here is what he says:

There is absolutely no shortage of oil. I'm absolutely

convinced that oil prices shouldn't be a dime above $55 a

barrel.

What he means is there is unbelievable excess speculation in the oil futures market. He says:

I call it the world's largest gambling hall . . . It's open

24/7 . . . Unfortunately it's totally unregulated . . . This

is like a highway with no cops and no speed limit, and

everybody's going 120 miles per hour.

So you wonder, is there excess speculation going on that has driven the price of oil and gas up like a Roman candle? Well, according to a study that was done by the House Subcommittee on Oversight, in the year 2000, 37 percent of the people in this market were speculators. Now it is 71 percent of the people in these energy markets who are speculators.

Well, how does that happen? We have a regulator: the Commodity Futures Trading Commission. They are supposed to wear the striped shirts like referees at a basketball or football game. They wear the striped shirts and have a whistle, except these folks forgot to put on their shirt and don't know how to blow a whistle. They are not interested in being a referee. They say: Whatever happens, happens.

Mr. Lukken, the Acting Chairman of the CFTC, says: Everything is fine: ``Based on our surveillance efforts to date, we believe that energy futures markets have been largely reflecting the underlying fundamentals of these markets,'' which means there is no excess speculation here. That is from the top regulator.

From the Secretary of Energy, Sam Bodman, last month: There's no evidence we can find that speculators are driving futures prices [for oil].

Oh, really? Let me show you this chart. This is a chart by the Energy Information Administration. We fund that agency with $100 million a year. These are the folks who make projections. Take a look at every one of these projections for the last year, as shown on this chart: In May of 2007, here is what they said the price of oil would be. In July of 2007, here is what they said the price of oil would be. In November of 2007, here is where the price of oil would go. Yet here is where the price actually went: straight up.

Why were they so wrong? Because this is not about supply and demand. It is about an orgy of speculation--unbelievable excess speculation-- that has driven this market like this.

Now, we can ignore all this. You can pretend it does not exist. But every bubble bursts. We know that. The question is, when? In the meantime, how much damage will be done to this country's economy? How much damage to the airline industry, the trucking industry, to farmers, to families trying to figure out: How do I borrow enough money to fill the gas tank in order to drive to work?

So here is what the legislation will do that we have introduced. As I describe this, let me say this: There are a lot of press conferences around here talking about what we have to do. I support all of it. In fact, Senator Bingaman, myself, Senator Domenici, and Senator Talent were the four original cosponsors of legislation of opening lease 181 in the Gulf of Mexico. That is now done. That is law. I support drilling offshore. I demonstrated that by the lease 181 position.

I do not support drilling everywhere. And if drilling is our answer every 20 years, that is called yesterday forever. I am much more interested in doing a lot of everything: conservation, efficiency, drilling, especially renewables, and I am especially interested in something that is game changing. What I would like to do, on an emergency basis, is put in place something that 10 years from now will allow us to understand we are using energy in a very different way, and we do not need so much oil from Saudi Arabia, Kuwait, Iraq, and Venezuela.

But that is not what some would have us do. The whole issue--the master narrative--for them is: You have to drill, you have to drill, you have to drill right now. Some of the same people who talk about that ignore the growing bubble in the oil futures market that has driven up the price of oil double in 1 year.

Now, I ask anybody in this Chamber to provide me and the American people with anything that has changed with supply and demand that justifies the doubling of price in 1 year. They will not do it because you cannot do it. I had one of the top people on Wall Street, from one of the biggest firms on Wall Street, come to see me. He is one of these guys that talked so fast, when he was finished talking, I was out of breath. He could not answer the question when he came to my office, and he could not answer the question when he left my office.

What has happened with respect to supply and demand that justifies the doubling of the price of oil in 1 year? The answer is: Nothing has happened in supply and demand in the last year. What has happened is this unbelievable rush of new money into these futures markets through speculators. Now, what is a speculator? First of all, these markets are very important. We had a futures market established in 1936 for a very important reason. Those who are trading--that is producers and consumers--a physical product need to be able to hedge their risks. But a substantial portion of that which is now in those futures markets is not about hedging risk by producers and consumers of a physical product. It is about people who have no interest in the product. They have interests in exchanging contracts for the purpose of making money, and they have driven up these prices in a very dramatic way.

So let me describe what we propose to do. We propose to have a regulatory agency--one that so far has been dead from the neck up--do the following things: No. 1, distinguish between legitimate hedging-- that is, hedging between producers and consumers of a physical product in order to hedge risk--distinguish between that and all other trades which are purely speculative trades having nothing to do with what the product is. They are just interested in making money with respect to their own speculation.

I have said many times that Will Rogers described this in the 1930s. He talked about people who buy things they will never get from people who never had it--and in these days with money they don't possess. But it is causing dramatic damage to this county's economy when you have a bubble of speculation occur in this commodities market.

To those who say it is not happening, I would ask them to bring this chart to the floor from the Energy Information Administration and take a look at the last eight estimates of prices for energy based on supply and demand by the best people they have to evaluate supply and demand. They should take a look at what has happened to the price of oil relative to what EIA officials expected to have happen, evaluating supply and demand. If you don't get excess, unbelievable, relentless speculation out of this chart, then you don't get it at all.

Now, the proposal that has been offered is S. 3268. I indicated it requires the delineation between normal hedging of a physical product by producers and consumers as opposed to those who are engaged in pure speculation.

Then, it requires position limits that are significant against those who are pure speculators. Those position limits are very important because that is what helps wring the speculators out of this marketplace.

The proposal also increases regulation of Foreign Boards of Trade, index traders, swap dealers, and over-the-counter transactions, among other things.

It requires the Commodity Futures Trading Commission to convene an international working group to work to find ways to standardize regulation and protect the futures markets from non-legitimate hedge trading.

The proposal would also require the CFTC to use its existing authority to revoke or modify all prior actions or decisions that prevent the CFTC from protecting legitimate hedge trades and to discourage speculative trades. Inexcusably, the Commodity Futures Trading Commission itself has taken the position: Do what you want to do. We will not look. Don't worry. In fact, the evidence of that is all in what are called ``no action'' letters. Boy, what a description for a regulatory agency: no action letters. They put them out again and again and again and again, which says: Do you know what, let's blindfold ourselves. We propose we blindfold ourselves. It is unbelievable, in my judgment.

We provide that 60 days after passage of this bill, a report to Congress must be offered by the regulatory agency with respect to any additional authority they need. But we take the position the CFTC has ample authority to do all the things we have described but does not use the authority because it is not interested in regulating.

So there are a number of things we believe are important. Protecting legitimate hedge trading, that is a very important part of this market. This market is an important market. But when a market is broken or perverted or a market is a place of excess or relentless speculation that damages this country's economy, then I think we have a responsibility to take action.

Now, some will say: Well, you have to do these six things. We would not accept a bill or we would not even consider a bill that deals with speculation unless you do the other five or six things. It is akin to somebody who has a heart attack who is grossly obese, dramatically overweight. He has a heart attack and somebody says: Well, instead of working on the heart, let's work on this overweight issue. Let's try to deal with this obesity. Well, what about dealing with the heart attack first? How about dealing with the things you can deal with first that puts some downward pressure on prices?

So I expect this town now, from having filed S. 3268, will be full of people who will say: There is no speculation. Or if there is speculation, it is a minor amount. Or if there is speculation, this is the wrong remedy. Or if you take this remedy, you drive all trading overseas, which is absurd, by the way. Or if you do this, you ruin the markets. I expect we will see all those excuses.

To all those who come to the floor to say: I support conservation, I support efficiency, I support renewable energy, I support additional drilling, I say: Do you know what, I agree with all that. I agree with all that, though I do not support indiscriminate drilling everywhere. That does not make any sense to me. But I agree with a remedy that says: We should do a lot of things and a lot of things well. But I also think if all we do every 20 years is talk about more drilling, you are not talking about anything that is game changing for this country. That is called yesterday forever. Congratulations on the policy, but it is a policy that hardly begins to free this country from the shackles that bind it with respect to the current energy policy. Even as we consider all of those other issues--and we must on an emergency basis--I think we ought to take the first big step and deal with this issue of excess speculation in the market.

Again, I come back to this chart. If you don't believe excess speculation exists, then answer this question: What has happened in the last 12 to 14 months that justifies the doubling of the price of oil? Demand up, you say. No, I am sorry, that is not the case. Demand is slightly less than was expected

in every one of these circumstances. So if demand isn't up, you may say: Well, but China and India, Senator Dorgan. Don't you understand that? Yes; 12, 14 months ago we understood what China and India were expected to demand at that point.

My point is aggregate demand in the United States is down slightly. China and India are up. It was expected that our demand would increase for the first 5 months of this year. In fact, we experienced increases in inventory and stocks of the supply for the first 5 months. So you cannot point--and I have never found an expert who can point--in the last 12 to 14 months, to something that has changed in any significant way in supply and demand that justifies the doubling of oil prices.

So my proposition is this: Let's deal with what most people understand to be a problem. Excess speculation is rampant and the marketplace is broken. Let's demand the regulators begin to earn their salary by thoughtful regulation with that which is prescribed in the legislation that I have introduced. Then, at the same time, we should move on to other issues for the coming decade when we ought to dramatically change the way we use and produce energy in this country-- renewables, conservation, efficiency and so much more.

I see I have exceeded my time.

I yield the floor.

Mr. President, I ask unanimous consent for 30 seconds to respond, and that the Senator from Tennessee then be given an additional 1 minute.

Mr. President, we have had testimony from experts who have said that this excess speculation has driven up the price of oil and gasoline, in some cases they estimate by 20 percent; in other cases they estimate as much as 40 percent. I don't think there is any question that if you look at this line--this is the line where prices have gone--that you have to conclude this has had a dramatic impact on the price. You can't see these things swing back and forth $4 and $7 and run up to $145 a barrel like some sort of wild curve, behind which there are no set of facts that would justify it. That is why it is important, I believe, for this Congress to tackle this issue.

I yield back the remaining time.

Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, I thank the Senator from South Dakota. Senator Thune and Senator Kyl have worked on a piece of legislation that I believe is very important. We have worked together on a wide range of these issues.

I held a hearing in Arizona with Senator Kyl on Indian law enforcement issues. I worked with Senator Thune on the issue he described with respect to the Standing Rock Sioux Indian Reservation and the very serious law enforcement problems and challenges they face there.

Amendment No. 5084 to Amendment No. 5076

I wish to offer a second-degree amendment. I offer it on behalf of myself, Senator Thune, Senator Johnson, Senator Kyl, and Senator Bingaman. I ask the second-degree amendment be considered. I send it to the desk.

I ask unanimous consent the reading of the amendment be dispensed with.

Mr. President, the underlying legislation that is offered by Senator Biden and Senator Lugar is a very important piece of legislation. We have moral responsibility to address global AIDS, so I support what we are doing. I believe it is very important. We have worked with Senator Biden and Senator Lugar with respect to the first- degree amendment offered by my colleagues and the second-degree amendment I have offered.

While I believe we have a significant moral responsibility to address global AIDS and will do so in the underlying bill, it is also the case that we do not have to go off our shore to find Third World conditions. You can go to some Indian reservations in this country and find Third World conditions in this country, dealing with health care, with crime, with education, and a whole range of issues.

Take a look at some of the Indian reservations and you will find people have water in their house because they hauled water. They haul water every day, or sometimes two or three times a week, in order to have water in their home. You will find there are places that do not have indoor plumbing; they have outdoor toilets. We have had testimony before my committee of people living in used trailer homes with wood- burning stoves, vented out of a pipe through a window in the living room. Third World conditions exist in this country.

The amendment offered by my colleagues, and my second-degree amendment, begin to address these issues in the area of law enforcement, health care, and water policies. It is very important.

I wish to describe the second-degree amendment. I fully support the underlying bill and am proud to be a cosponsor of it.

In regards to the law enforcement issues, you don't feel safe, you are afraid of the violence on the Indian reservations, as stated by my colleague who described the Standing Rock Reservation that straddles North and South Dakota and its substantial runup in violence. In response to this, we now have additional resources, additional law enforcement people, but they will only be there for 90 days. We need to address these issues. One in three Native American Indian women will be raped or sexually assaulted during their lifetime. My colleague described that. We had a hearing about that subject. We need to address the violence that exists and therefore address the law enforcement issues. That is what the underlying amendment does. My colleagues, Senator Thune and Senator Kyl, have done a great job working on this.

We have also worked together on other legislation we are introducing that is bipartisan, that is a broad legislation dealing with law enforcement. I appreciate the work of all my colleagues on the Indian Affairs Committee to address those issues.

But I wish to talk about this second-degree amendment. The underlying amendment is a $2 billion issue. A portion of that, $250 million, will be dealing with the issue of Indian health. As we described before, the amendment deals with water and law enforcement. This second-degree talks about $250 million dealing with Indian health, half of which will be addressing facilities and the needs of facilities and the other half addressing contract health funding shortages that are in desperate need.

We had a hearing about 2 weeks ago. A young woman named Tracie Revis came to the hearing. She was a member of the Muscogee Creek Nation, a student at the University of Kansas Law School, a Native American. She shared her story with my committee, and here is the story.

She began law school in August 2005. After she had been sick for a year and a half, she finally withdrew from law

school in order to try to get some medical treatment. Her doctors discovered a large mass in her chest and she was subsequently diagnosed with Hodgkin's Lymphoma. She went through several cycles of chemotherapy, stem cell transplant, radiation in order to try to be cancer free. She is cancer free today.

Throughout her diagnosis and treatments, she struggled to try to get approval for coverage from the Indian Health Service. Due to the lack of access--there was very little access where she was--and the urgency of treatment, she was forced to pay for most of her own treatment. She was left with over $200,000 of personal debt. That included the cost of a surgical procedure where a doctor was conducting a biopsy on this young woman, and, during the conduct of this biopsy, they discovered a cancerous tumor that was much larger than they expected. They decided to surgically remove 75 percent of that tumor during the biopsy. The problem was the doctor doing the surgery, while in the operating room, made this decision but didn't get approval from the Indian Health Service for the surgical procedure so that now the young woman personally owes the funding for that surgery.

That is what is happening in the Indian Health Service, and it has to end. When we dealt with an Indian health bill a while ago, I showed a photograph of this young woman, 5 years old; her name is Ta'shon Rain Littlelight. I will tell you about her, briefly, to tell you why I am so passionate about trying to provide some funding for Indian health. I was, at the time, at the Crow Nation in Montana with Senator Tester, holding a hearing, and her grandmother showed up. Her grandmother held this photograph above her head and she said Ta'shon was 5 years old. She loved to dance. You could see the sparkle in her eyes. Ta'shon became very ill. They took her again and again and again to the Indian health clinic and they diagnosed this 5-year-old girl with depression-- depression, they said.

Then one day she became violently ill. They took her to Billings, MT. From there, she was put on an airplane, taken to the cancer center in Denver, CO, and she was judged to have had terminal cancer.

Ta'shon Rain Littlelight lost her life. Her grandmother and then her mother told me of 3 months of unmedicated pain for this little 5-year- old girl because she didn't get the health care treatment most of us would expect for all our families. In fact, when they diagnosed this young girl with terminal cancer, one of the things Ta'shon Rain Littlelight told her mother she wanted was to go see Cinderella's Castle, and Make-A-Wish Foundation--what a wonderful organization-- provided the opportunity for her to go to Orlando, FL, to see Cinderella's Castle at Disney World. The night before she was to visit the castle, in the motel room, Ta'shon snuggled up to her mother and said: I am so sorry I am sick. I am going to try to get better, Mommy.

She died that night in her mother's arms. She never saw Cinderella's Castle. Now, a 5-year-old is dead because she didn't get the kind of health care most of us would routinely expect. She was sick so they said she was depressed. No, she wasn't depressed. She had terminal cancer and wasn't treated and she lived the last 3 months of her life at that age in unmedicated pain.

This country can do better than that and has a moral responsibility to do better than that.

I can stand here and tell stories for hours--Ardel Hale Baker, who was having a heart attack and was sent to a hospital and pulled on a gurney into the hospital with an 8-by-10 piece of paper Scotch-taped to her leg that said: If you admit this patient, understand we are out of contract health care funding so you, hospital, may be on your own; you may not get paid. This is a woman having a heart attack, wheeled into an emergency room with a piece of paper tacked to her leg saying: By the way, you might not want to admit this patient because Indian Contract Health is out of money.

If I am upset about these things it is because I have seen and heard so much that makes me sick about the way this health care system works for some and not for others. We can do much better.

My second-degree amendment is supported by a good number of my colleagues--Senator Johnson, Senator Thune, Senator Kyl, Senator Bingaman, and Senator Murkowski. My amendment takes a portion of this $250 million authorization out of the $2 billion, that is the subject of the underlying amendment and says: Let's do this. Let's deal with the water issues--which are very important. I commend my colleague. Let's deal with the law enforcement issues. They are urgent. I commend my colleagues for that. Then let's also carve a piece out with respect to Indian health, half of which will deal with facilities that are desperately needed and half of which will deal with contract health care funding. This funding is so desperately short that in many parts of Indian Country the refrain is: Don't get sick after June because there is no money.

We have a trust responsibility. And that trust responsibility is a promise this country made long ago and a promise this country ought to start keeping. So I am proud to offer the second-degree amendment. This is a bipartisan effort to deal with water, law enforcement, and health care.

I am pleased to be here with my colleague, Senator Kyl, who will be here shortly. But as I indicated, he and I have conducted a hearing on a reservation just outside of Phoenix, AZ, on the law enforcement issues. He has worked very hard on those issues, and so, too, has Senator Thune. I appreciate the cooperation and the work we have done together.

I yield the floor.

Would the Senator yield for a unanimous consent request?

I ask unanimous consent that Senator Murkowski be added as a cosponsor on my second-degree amendment. She is a cosponsor of the underlying amendment.

Mr. President, would the Senator from Nevada yield for a question?

I was noticing a story that just moved on the wire, and it says:

In a big win for the U.S. futures industry, new Senate

legislation unveiled on Wednesday would not impose higher

margins on oil traders but would still aim to rein in

excessive speculation in energy markets.

I want to make a comment about that, because it goes on to say:

Futures markets participants had feared that earlier

legislation introduced by Senator Byron Dorgan to boost

significantly the

amount of money, or margin, that speculators would have to

put up to trade oil futures would make it into the final

anti-speculation bill.

So they paint this as some sort of victory, but let me point out what they missed. Yes, I am the one who authored a bill that said: Let's put in 25 percent margin requirements in order to wring out the speculation in this market. What they missed, however, is that last week we met in a room over here for 3 hours into the evening, and I indicated then that I don't need to have a 25-percent margin requirement if you have position limits that are effective. The bill the majority leader has introduced, which I am cosponsor of, and pleased to be a part of it, does the following: It distinguishes between legitimate hedge trading by commercial producers and purchasers of physical energy commodities for future delivery and their direct counterparties, and all other speculators. Then it establishes real position limits. That is what wrings the speculators out of the system.

Now, there are some who say: Well, speculation is not going on here. There is no issue with speculation. A study done by the House Subcommittee on Oversight and Investigations found that in the year 2000 about 37 percent of those who were in the oil futures market were speculators. Today, it is 71 percent. This market is broken. It has been taken over by speculators. Will Rogers described them as people who are buying things they will never get from people who never had it, making money on both sides of the trade, and grinning all the way to the bank. The problem is they are damaging this economy, hurting American families and destroying this country's airlines and farmers and truckers.

I wanted to make the point to the Senator from Nevada that when someone writes a story and says this is a big victory for the futures market because it doesn't have the 25-percent margin requirement, I was fine with dropping that piece if we had strong position limits that apply against those who aren't engaged in legitimate hedging but, instead, are engaged in pure, raw, unadulterated speculation.

If I might make one other point. This market was set up in 1936 by President Franklin Delano Roosevelt. When he signed the bill, he warned about speculation. He warned about speculators taking over a market. The fact is, the bill that created this market has a provision that deals with excess speculation. Our problem is that under this administration, there is no such thing as regulation. So the regulators, who are supposed to be wearing the striped shirts and blowing the whistles and calling the fouls in these markets, have decided they don't want to regulate. These folks have gone hog wild and destroyed the market for oil futures and driven these prices up to $130, $140 a barrel, far beyond where supply and demand would justify it being.

That is why I wanted to make the point that the bill we introduced last night--and I applaud the majority leader--is a bill that does exactly what we had intended it to do following our meeting last week. Yes, we dropped the new margin requirement, but that is not a failure. We dropped that because we put in very strong position limits to wring the speculation out of these markets. Isn't that the case, I ask the Senator?

If I might make an additional point, Mr. President, by asking the Senator from Nevada a question. The issue of position limits is critical. That is why this bill has teeth and bite and could actually accomplish something. We will have some other people here in this Chamber who will come to the floor believing in their policy, which is yesterday forever--drill, drill, drill, drill. Every 20 years, we have another debate about who wants to drill where. But the fact is, that is not a game-changing approach to address energy in a significant way.

We want to do this in 2 steps: No. 1, wring the speculation out of this market and bring down prices, and some say by as much as 40 percent; and No. 2, we see a very different kind of energy future. Yes, we increase production, but we must have conservation, efficiency, renewables, and other things.

So for those who come to the floor and say, well, taking on speculation is too easy, well, it is easy when it is right in front of you. There are some people refusing to recognize it when it is right in front of them.

I want to show this chart to my colleague from Nevada. This chart shows what has happened to the price of oil, and every driver in this country knows that is what has happened to the price of gasoline as well. This red line is the price, and it goes up like a Roman candle: up, up, up, up.

Here is what our Energy Information Administration said. We spend $100 million a year on this agency down at the Department of Energy that has all the people who estimate what is going to happen to the price of oil. Let me show you their estimates. Back in May of last year, here is what the price of oil is going to be--straight across. Kind of a bump here and there. In July, here is the price. January of this year, here is where we think the price of oil will be.

So how is it they could miss it by so far? Because at each of these junctures they took a look at supply and demand and estimated what the price would be. They missed it by a country mile. You would have to be blind to miss it by this far, right?

Why did they miss it? Because this is all about speculation. It has nothing to do with supply and demand--not a thing. And if we say speculation is fine, let's let it damage our country, let's do nothing about it, I think we would be fools. The American people understand you have to take these two steps: No. 1, wring the speculation out of this system and put downward pressure on prices; and then, No. 2, do a new construct with a game-changing plan on energy for the future.

But I ask the Senator from Nevada: Is it not the case that the agency we rely on for estimates has not just been wrong by a foot but wrong by a mile in every case because they could not measure what this excess speculation was going to do to this country?

If the Senator will yield for one additional question, I would make the observation that we come to the floor of the Senate wanting to do something. I understand there are 100 ideas, some of them long term, some would have an impact in 10 years, some in the sweet by- and-by. But this proposition is about the here and now. What do we do about the here and now with respect to speculation?

There is a radio announcer who was talking once about interviewing an old man--age 85 years old. The radio announcer said: I bet you have seen a lot of changes in your life.

And the old guy said: Yes, and I have been against every one them.

We know some people like that, and they serve in this Chamber. They are against anything.

My question is, wouldn't it make sense for us at least to put this in the bank of progress; that is, to shut down the speculation, put downward pressure on oil and gas prices? If some experts are right--Mr. Gates, for example, a top energy analyst for Oppenheimer & Co. for 30 years, says as much as 40 percent or more of the increase in the price of oil and gas is because of excess speculation. He said to us it is like a casino open 24/7 today, like a highway with no speed limit and no cops.

Let's assume he is right. Other experts have said the same thing. Wouldn't it make sense for all of us at least to agree to take this step and then take the other steps? Let's try to find a way to come together rather than to have all the folks who come to this Chamber say: No, not now, not this. Every single day we hear that.

My hope will be that we will get bipartisan support because it is the right thing to do and it is the right time to do it.

That is right.

If I might make just one final very brief comment. There are people in this Chamber, in the Republican caucus and the Democratic caucus, who have all spoken of speculation. My hope is that we can come together, work together, and do something in the next week or two, Republicans and Democrats, on this issue. I think we have put together a good bill.

I would say to the Senator from Nevada, one of the things he talked about in the middle of last week was making this a bipartisan initiative in the Chamber of the Senate. I very much hope that can be the case in the coming days.

Madam President, let me make a couple of points. No. 1, this legislation is real. I know people who look at the Congress and look at Washington, DC, and its Government and say, they have not done one thing to address this issue or that issue. This is one thing, and I think a significant thing, that could address the issue of the prices of oil and gas that have doubled in a year, with no justification for that doubling relating to supply and demand. This is one thing.

My hope is, in a Chamber that disagrees so often--my hope is that on this issue of national importance we could agree on this one thing.

I was sitting here thinking about when I was growing up. We raised some livestock and lived in a very small town. My father also had a gas station that he managed. So as a young man, I worked at that gas station. I pumped a lot of gas. People have told me my occupation may not have changed very much.

But the fact is, back in those days when gasoline was priced at a very low price and plentiful, the supplies of energy were plentiful, people did not think much about where is the energy going to come from.

Near my little hometown, they decided to drill an oil well. I had never seen an oil well. I remember as a little boy going out about 1 mile from town, looking at the oil well. There was not much to do in that small town. So you drive out and look at the lights on that drilling rig and stare. How exciting it was. And then it turned out to be a dry hole.

Well, 2 weeks ago, I was in western North Dakota where they are drilling in what is called the Bakken shale. When my colleagues talk about drilling, let me remind them that I asked for an assessment of what is called the Bakken shale formation. The U.S. Geological Survey completed it 2 months ago. It turns out they estimate there is 3.6 to 4.3 billion barrels of oil recoverable in the Bakken shale formation in eastern Montana and western North Dakota. The 3.6 to 4.3 billion is just in the North Dakota portion. The fact is, we have nearly 80 drill rigs right now drilling in that area, producing a great amount of additional oil. So I support that, my colleagues support that. We do support additional production. That additional production is ongoing and happening right now. It will be good for this country.

But the fact is, we are in a situation where we have an urgent need to deal with something that is happening in this country that is damaging our economy. The price of oil has doubled in the past year, and there is no justification in the marketplace for it related to the supply or demand--in fact, demand is going down in this country. We drove 5 or 6 billion fewer miles in the 6-month period than a comparable period before.

Today, we saw another monthly description of inventory going up. So the fact is, there is no justification for prices to have doubled. Now, to do nothing about this issue of speculation, which has run up the price double in a year, is to ignore the obvious. I mean, some might be content to ignore the obvious, not me.

Let's say someone who is grossly obese is brought to the hospital on a stretcher having a heart attack, and a doctor takes a look at this grossly obese patient having a heart attack and says: Well, what we need to do, we need to work first on the weight problem. Let's prescribe a diet.

No, that is not what they would do. They would deal with the heart attack first. That is what we need to do with respect to energy. We need do a lot of things, but first and foremost, we have to find a way to make this futures market work and wring the speculation out of that market and bring down prices.

Now, we have people who talk about the ``free market.'' Well, I am a big fan of markets. I do not know of a better allocator of goods and services than the marketplace. I am a big fan. I used to teach economics in college ever so briefly. The marketplace is something I admire. I want the free market to work. But sometimes the market is broken. Sometimes the arteries to the market are clogged and do not work. That is certainly the case with oil.

How do you make the market in oil? Well, you have the OPEC countries. They formed a cartel. It would be illegal and prosecutable in this country. OPEC forms a cartel. They all close and lock a door and have a suggestion about how much they want to produce and what price they are going to extract for it. That is the front end.

Second, you have oil companies, bigger and stronger through mergers. All of them now have two names: ExxonMobil, ConocoPhillips, they all have two names because they decided to get together and get hitched. So they did mergers. They are all more powerful and have more muscle in the marketplace.

You have OPEC, bigger oil companies with more muscle in the marketplace, and at the other end you have this futures market that has become an orgy of speculation, unbridled speculation. I showed a chart a bit ago that showed over 70 percent of the trades in the oil futures market are not by people who ever want to see a can of oil or carry a 5-gallon can of oil or see a 30-gallon drum of oil.

They are people who want to trade contracts and make money. That might be fun for them. They might be the most satisfied people in the world traipsing back and forth to put our money in their bank accounts in the last year. God bless them.

But if we have our way on the floor of the Senate, that is going to end. Because what is happening when you run up the price of oil--and gasoline doubled--and do the kind of damage that exists in this country today, airlines declaring bankruptcy, cities losing their airlines, family truckers who have been working for 30 years saying they cannot go on because they cannot afford to fill their tanks with diesel fuel, farmers and families trying to figure out: How do I scrape up enough money to fill my tank to be able to drive to work?

The fact is, it does not work for us to allow this to continue. This market is broken. We have a right, it seems to me, to restore the market to its original purpose. Go back and look at the legislation that created the oil futures market. The purpose was to have normal hedging to hedge risk between producers and consumers of a physical product, a perfectly reasonable and necessary thing to do. But what has happened is the market is taken over now by other interests. Those interests are described by a Wall Street Journal article many months ago that piqued my interest in what was going on: investment banks, hedge funds, pension funds, running deep into these futures markets driving up prices. Investment banks buying oil storage capability to buy oil and take it off the market.

That is not the way a market should work or should be expected to work. When a broken market damages this country's economy, we have a right and, in fact, we have a responsibility, in my judgment, to address it. There will be those who disagree very strongly with that which I say. They will be surrounding Capitol Hill with substantial effort to say: This legislation that we introduced last evening will be destructive and damaging.

I say to them: I know what is destructive and damaging, it is doubling the price of oil and gasoline in the last year. That is destructive and damaging to this country, to the families in this country, and to a good many businesses in this country that cannot fly through that storm.

So my hope is we will be able to get some bipartisan support for a piece of legislation that begins to shut down the excess speculation in the market that is damaging this country's economy.

I yield the floor and I suggest the absence of a quorum.

Mr. President, my colleagues have described it well. This is a very important vote. I think the reason we have gotten to this point shows how difficult it is to get anything done in this Chamber. I come from a State that is first in the Nation in the number of people 80 years old or older as a percentage of our population. I think we are in the top five or six, of people 65 years of age or older as a percentage of our population.

Medicare is so unbelievably important to the folks who live in my State. Does anybody think it serves the interests of this Medicare program to say: Well, let's decide on provider cuts--in this case physician cuts--of 10.6 percent? Let's take a big whack, a 10.6-percent whack out of the reimbursements and it would not matter; it would not affect the program. It doesn't make any sense to me at all that we would do that.

What we need to do is strengthen this program, and that is what the underlying bill does. We have had an awful time trying to pull it through the Congress. We finally got it through the Congress, and then we had the President veto the bill. We had a colleague come out of his sick bed and fly to Washington, DC, to cast the 60th vote, after which the other side collapsed and we got 9 other votes. This is very important. This is about who we are as a country, what we decide to invest in.

It is said that 100 years from now we will all be dead. I guess that is not just said; it is a fact. Only historians will take a look at our value system. They can take a look at what we decided to do as a Congress: How did we decide to spend money? What did we invest in? What did we think was important? What were our value systems? Did we believe the Medicare Program--providing health care to America's elderly--was a successful program, or did we decide we wanted to begin to take it apart?

That is what this vote is about. I don't understand at all why the President decided to veto this.

This passed the House of Representatives by a margin of 6 to 1 and got 69 votes in the Senate, and the President decides to exercise his veto.

It is unfathomable to me how much money we shovel out of this building and how much the President recommends when we spend overseas: $170 billion, $180 billion this year in emergency funding for Iraq and Afghanistan and all these programs to replenish all these accounts; contractor abuse. Somehow that doesn't matter so much. All of a sudden we want to make an investment in the Medicare Program, and that is not something that is valuable to us, the President suggests. It makes no sense to me.

In this bill, we have also tried to address the problem of disparate reimbursements for the various States. Some of the smallest States in this country--mine included--receive reimbursements under the Medicare program for providing health care that are dramatically different than reimbursements in other areas. Without fixing that, there will be a degradation of medical services and the delivery of services. This bill addresses part of that. That is why this bill is so critically important.

I hope we will have a resounding vote overriding the President's veto this evening at 6 o'clock.

Mr. President, I would like to announce that the Committee on Indian Affairs will meet on Thursday, July 17, at 10:00 a.m. in room 562 of the Dirksen Senate Office Building to conduct an oversight hearing entitled ``Tracking Sex Offenders in Indian Country: Tribal Implementation of the Adam Walsh Act.''

Those wishing additional information may contact the Indian Affairs Committee at 224-2251.

Mr. President, I suggest the absence of a quorum.

I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, my colleague, the Senator from Nevada, just described a series of challenges we face. I don't know that I have seen a more daunting time in this country in some long while than the time before us. The issues today of the credit crisis--the subprime loan scandal, bank failures, the threat of bank failures--these are serious issues. I am convinced the quick action by the Federal Reserve Board and the Secretary of the Treasury this weekend was necessary. But on top of that, there is a fiscal policy that is way off track. We are engaged in a war in which none of the cost of the war is paid for. We have a President who insists the entire cost of the war be added to the debt, and an attempt by Congress to change that would result in a Presidential veto. It is a fiscal policy that is way out of balance.

The President requests a budget to the Congress of roughly $420 billion in yearly deficits, but that, of course, is not the deficit. The deficit is how much we have to borrow. This President's fiscal policy is off track by the tune of $600 billion to $700 billion a year because that is, in fact, what has to be borrowed. He doesn't include in his budget request the cost of the Iraq war, which is very expensive.

We have the subprime loan scandal, the problems in the credit market, the fiscal policy that is off track, a trade policy that means we are running a deficit of over $2 billion a day every single day by importing more than we are able to export. Then, add to those issues what is happening to energy, particularly the price of oil running up like a Roman candle, $140 to $145 a barrel, and suggestions by some big investment banking firms that it may reach $200 a barrel. What does all of this mean? What do we do about it?

I have mentioned before a trip late one evening over the Pacific Ocean in what was the previous Air Force One, that big, old airplane. I believe it now sits at the Reagan Library in California, a 707. It was the Air Force One that brought John F. Kennedy's body back to Andrews Air Force Base in 1963. It was the Air Force One used by Presidents up until George Bush, the senior, and then it was replaced.

One of the last flights of that airplane was one I was on to Asia, to China, Japan, and Vietnam. A number of my colleagues were on that flight--the majority leader, Senator Daschle. My colleague from Ohio, John Glenn, was also on the flight. It was late at night flying over the Pacific that I had a chance, for the first time, to ask Senator Glenn a lot of questions about the time he rode around this planet in a little space capsule called Friendship 7 by himself orbiting the Earth. I was a very young person at the time of the flight, but I remember vividly the reports on the radio and television about John Glenn lifting off as the first American to orbit the Earth and how excited I was. So that evening, as a U.S. Senator, with my colleague, John Glenn, sitting there, I began peppering him with questions about that spaceflight.

One of the questions I asked was, I had remembered that the city of Perth, Australia, decided to welcome this astronaut flying alone by, when he came to the dark side of the Earth, turning on all the lights. Every light in Perth was on that night. They lit up this city called Perth, Australia, and I asked John Glenn that evening: Did you see the lights of Perth as you reached the dark side of the Earth up there in space alone? Did you see that shining light of Perth?

He said: I did.

The only evidence of human life that existed on the planet below were the lights shining up, a product of energy. It was perhaps not a surprise to him to understand that product of energy affects our lives every day in every way. Energy is critical to our lives. We get up in the morning, virtually every one of us who is within listening distance, and we flick a switch. That means a light goes on, the product of energy. It means perhaps you brush your teeth with an electric toothbrush, and thus battery energy. It means you shave with an electric razor, perhaps, and use electric energy. You heat up some coffee, electric energy. You take a shower and a hot water heater that runs on either gas or electric energy produces hot water. Then you get in the car to go to work, and you put a key in the ignition and turn it. You use energy, in most cases from gasoline.

Energy affects almost everything we do, and we don't give it a second thought until one day when the lights go out and electricity is gone for 4 days and an entire neighborhood is up in arms. How on Earth can we live without electricity? Or until at some point when gasoline is not available and, therefore, your car is of little value. It happens from time to time.

Now what has happened to our country and to the world with respect to energy policy is, we have a big appetite for energy. We are seeing the price of oil, which is a very important part of our energy appetite, go up, up, up, like a Roman candle, $140 to $145 a barrel, and gasoline prices follow suit. A whole lot of folks at this point aren't able to afford to fill the tank with gas. A whole lot of trucking companies can't afford to buy the gas or diesel for their saddle tanks on those big trucks. A lot of airlines can't afford to put jet fuel in the wings these days. So we have a good many airlines going into bankruptcy, and more out of business.

The question is, Why is the price of oil where it is? What has happened? Let me describe a couple things that have happened that lead me to believe we have to take action now, and very aggressive action as well. In the last 12 to 14 months, the price of oil has doubled. Has anything happened in the last year with respect to supply and demand that would justify the price of oil doubling? I can't think of anything, except perhaps there is less demand for gasoline at the moment. Our country is driving less. We have driven something close to 5 or 6 billion fewer miles in this 6-month period than the previous 6- month period. So demand for gasoline is actually down. One would think if that is the case, prices should abate or come down. But they didn't. They went straight up.

Here is what is happening: Explosive growth of speculation in the oil futures market. Speculators in the year 2000 were 37 percent of that market. In 2008, 71 percent of the people in this market are speculators. That is, they are not interested in owning oil. They are interested in contracts for oil with which they can buy and sell and trade and make a profit.

Will Rogers described it decades ago: People buying things they will never get from people who never had it, making money on both sides of the trade. So what about speculators? Are they causing price increases?

Let me share some comments from some people who might know. The senior vice president of ExxonMobil, in April of this year:

The price of oil should be about $50 or $55 per barrel.

Another comment:

Experts, including the former head of ExxonMobil, say

financial speculation in the energy markets has grown so much

over the last 30 years that it now adds up to 30 percent or

more to the price of a barrel of oil.

Energy Secretary Bodman takes a different view. He says:

There's no evidence we can find that speculators are

driving futures prices [for oil].

Let me give you a couple different views. The CEO of Marathon Oil:

$100 oil isn't justified by the physical demand in the

marketplace.

This is from Clarence Cazelot, CEO of Marathon Oil.

From a chart I have used previously, Mr. Fadel Gheit, who was for 30 or 35 years the top analyst for Oppenheimer & Co., he said:

There's no shortage of oil. I'm convinced that oil prices

should not be a dime above $55 barrel. I call it the world's

largest gambling hall. It's open 24/7. Unfortunately, it is

totally unregulated. This is like a highway with no cops and

no speed limit, and everybody is going 120 miles an hour.

I want to go back to the Energy Secretary's notion that there is really no speculative role. Here is the Washington Post, July 7, a week or so ago:

The wave of investment dollars has flooded commodity

markets in recent years and critics say contributed to the

runup in prices.

Here is the point:

Investors, including pension funds and Wall Street

speculators, have sharply increased their commodity

allocations since 2003, from $13 billion to $260 billion.

This has made financial actors an even larger force on these

markets than farmers, airlines, trucking firms, and companies

that buy and sell the physical goods to run their businesses.

For decades, trading commodity contracts were considered

taboo by most pension funds because the market is so volatile

and risky.

That has all changed. Now we have the California pension fund, CalPERS, and other pension programs that are shoving money into the commodities futures. It doesn't mean they want to own oil. They want to speculate.

Walter Lukken is the Acting Chairman of the Commodity Futures Trading Commission. This is the Commission that is supposed to be the referee, the Federal regulator wearing a striped shirt and blowing a whistle when they call the fouls. Markets work, in most cases, but when markets don't work, you have to have a referee. Walter Lukken, the referee for us, says the price of oil is going up because demand is outstripping supply, strong fundamentals are at play. Apparently, he misses the fact from 2003 until now, $13 billion to $260 billion, that is an additional $247 billion have gone into this market driving up the price of oil, having almost nothing at all to do with supply and demand.

There is a need, it seems to me, for the Congress to address this issue of excess speculation. Those that need a commodities market are the airlines, trucking companies, farmers, and others so they can hedge risks. There is a legitimate function of hedging risks, and that is what the market was created for. A consumer and producer hedges risk with respect to a physical product, a perfectly legitimate function. But the fact is, those interests that are most concerned about the Congress taking action to address a market that is broken are those who need the markets to hedge risks--airlines, trucking companies, farmers and others--because they know this market is broken. They know this is a market that is supposed to work for them to hedge risk, but now it is completely broken, taken over by speculators.

There is a columnist in the Washington Post this morning who does his usual--he does about two pages of research and then he skips the next five pages, so he never quite gets to the truth. He says this speculation stuff, that is made up. He doesn't use the word ``populace.'' He says they are a bunch of ne'er-do-wells who don't have the foggiest idea what they are talking about. It is not a surprise to me that there are those who believe the current system is working. It certainly works for some, doesn't it?

The OPEC countries must love walking to the bank with our money and making a deposit in their account. The oil companies must love making deposits of our money into their accounts. I understand why some of the investment banks and other market players who are engaged in neck-deep speculation and have been making a lot of money love the status quo. They love what has happened here. It doesn't bother them a bit where the price of oil is, as long as they make money over all this speculation.

What I think we should do is pass legislation similar to that which I have introduced. It is called the End Oil Speculation Act. End oil speculation--how do you do that? You do it through a couple of approaches. No. 1, you take the oil futures market and you require the referee, the Commodity Futures Trading Commission (CFTC), to distinguish between legitimate hedging--that is, those who want to, between a consumer and a producer, hedge their risk with a physical product. You must distinguish between those interests and all other interests who are just in this market to speculate.

With respect to those who are in this market just for pure speculation, establish significant position limits. We can wring the speculation out of this system and should. I am talking about the excess speculation. This oil commodity futures market was created in 1936, and when President Roosevelt signed the bill, he warned about excess speculation. In fact, the bill itself had a provision dealing with excess speculation. Now we find ourselves, all these decades later, with a dramatic amount of speculation that is wrecking this market. Should we do something? The answer is we must. We don't have a choice. Of course, we should.

My hope is--as the majority leader indicated, we are going to be able to address this issue later this week. My hope is we will be able to take legislation to the floor of the Senate, and if a regulator cannot regulate effectively--and this CFTC apparently cannot--and the head of the regulators has already made a judgment, a judgment he has stated four or five times since January: This market is working fine. This is not about speculation. This is about the fundamentals of supply and demand. What, me worry? Things are fine. Don't worry. Then, at the end of last month, the Chairman apparently had some sort of epiphany, a dream and woke up the next day and said: We have actually been investigating this for 7 months.

One of those statements is not true: Supply and demand at work; don't worry, be happy; or we have been worried for 7 months. It is not clear what position represents the position of the Chairman of the CFTC, but they are positions at dramatic odds with one another.

Let me say in addition, we hope this week we can address some legislation that will bring down the price of gasoline and put downward pressure on oil prices. Even doing that doesn't address, in the long term, what we need to address. All of us understand that. But it does address, in the short term, what we have to do to put some downward pressure on these prices.

I don't think there is any question that the price of oil and gas and the runup is hurting the economy of this country, hurting key industries in this country, certainly hurting American families, and we can do something about it, I believe, in the short term.

In the longer term, some of our colleagues will say: We have to drill. I support that. I don't support drilling everywhere. But it is interesting, the minority party put together a proposal that talks about drilling. But they forgot to include all this area off the coast of Florida. Isn't it interesting, I know why they didn't include it. Because one of their caucus does not want to drill off the coast of Florida, does not want to drill in these eastern waters off the Gulf of Mexico. They also know President Bush does not want to allow U.S. companies to drill off the coast of Cuba, so these were included in their proposals. They are all big drilling advocates, except they don't want to drill where most of the oil exists.

This is a chart of the technically recoverable oil. Let me show where it is. This is the Outer Continental Shelf of the Pacific, this is Alaska, this is the Outer Continental Shelf of the Atlantic, and this is the Gulf of Mexico. We

can see where the bulk of the technically recoverable oil is. I was one of four Senators--Senators Bingaman, Domenici, and then-Senator Talent--who offered the legislation to open lease 181. Lease 181, which is now 8.3 million acres in the gulf, was opened in 2006. That is an additional 8.3 million additional acres opened for oil and gas leasing.

I have also introduced legislation that opens all this additional area in the eastern Gulf of Mexico and off Cuban waters. So do I support drilling? I do. It is just that the minority side does not support it quite as much as they pretend to support it.

Let me describe this chart. These are the waters off Cuba open for leasing. There is half a million barrels of oil a day that could come into production, and our U.S. companies cannot go in there to compete against other nations to drill for it. Spain is there. Canada is there. India is there. China is there. They all have a desire to drill in that water. We cannot go there because our companies are told by President Bush: No, we have an embargo against Cuba; you can't go after this 500,000 barrels of oil a day in these waters because of our embargo against Cuba. That is absurd, absolutely absurd.

I have said often on the floor of the Senate, we stick little straws in this planet as we circle the Sun and we suck out about 86 million barrels of oil a day. We use one-fourth right here on this little place on the planet called the United States. We have a prodigious appetite for oil. That reflects in many ways the economy we built. We have built a wonderful economy. This is a great place to live. There is no place like it on Earth. But divine providence did some strange things. Most of the oil is under the sands halfway around the world in the Persian Gulf, and most of the demand is in the United States. There is more and more demand ahead of us with respect to China and India. We understand that. We knew that 12 to 14 months ago. So that is not what is causing the runup in prices today.

But we all know, if we look ahead, we need to leapfrog to other technologies, even as we search for additional oil. We will drill for more oil in the right places. Obviously, the chart I showed for the Gulf of Mexico has far more than my friends in the minority would aspire to achieve in other regions.

In addition to drilling in an appropriate way, we need much more conservation. Conservation is the easiest and by far the least expensive way to produce energy because we are such unbelievable wasters of energy. So conservation is, first and foremost, the best place to get additional energy.

Second is efficiency. It doesn't matter what you use--a hot water heater, a furnace, an air-conditioner--it doesn't matter what you use. The dramatic increase in efficiency of every appliance everybody uses, including these light bulbs, can substantially reduce our need for energy. The incandescent light bulb is on its way out. It will not be too many years when we will not find one in this country because we can light America's houses and commercial facilities with about 80 percent savings of what we have been using in the past.

Finally, and most importantly, in my judgment, as we look forward some years, we have to, as a country, decide to get dramatically involved in renewable energy. We are not nearly there yet. We have some movement toward renewable, but we are not doing what we should do. The debate in the Congress has been about whether we should increase the production tax credits, tax incentives by 1 year. That is pathetic. We ought to say we are going to do this for a decade. America, you can count on where we are headed.

In the next decade, we are going to build substantial capability for wind, solar, biomass, and more. We ought to say here is where America is headed for 10 years. We are nibbling around the edges talking about a 1-year extension of this and that. It is not that we have not tried.

We had a longer extension on the floor of the Senate, but regrettably, the minority side largely blocked it. In fact, they have blocked these extensions three times. Our hope is that we as a country will be able to say our policy is conservation, efficiency, yes, drilling in the right places, but our policy is especially to move forward with substantial and dramatic amounts of new renewable energy.

I know the American people look at the Congress from time to time and wonder if anything can get done. There certainly is an urgency with respect to the policies I described--the fiscal policy that is way off track, a trade policy that is producing $800 billion a year in trade deficits, a policy that has allowed the subprime loan scam to exist and develop right under the nose of regulators who apparently were dead from the neck up. All these things are urgent needs for this country to address. But none is more urgent at the moment than trying to find a way to put some downward pressure on gas and oil prices that have risen out of sight, in my judgment, disconnected to the supply-and-demand fundamentals of where a market ought to be.

Every American is affected by this runup in prices, and our country is being irreparably damaged by what it costs for us to send all this massive money every single day overseas in search of oil that is produced outside our country's borders.

We need a short-term urgent plan and a long-term thoughtful plan to find our way through this situation and put America on a better course for energy.

I yield the floor and suggest the absence of a quorum.

Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, I have noticed that late this afternoon a number of speakers have come to the floor of the Senate decrying the fact that there is not oil drilling here or there or elsewhere and suggesting that they and they alone have the answer to our energy problems. I wish to respond by saying this issue of drilling for oil is an important issue. I, along with my colleagues, Senator Bingaman, Senator Domenici, and Senator Talent, introduced the bill in the Senate that opened what is called Lease 181 in the Gulf of Mexico. That is now law. We now have companies exploring for oil and gas in Lease 181 in the Gulf of Mexico. Why? Because I think it makes sense to do that. If you take a look at the oil reserves in Outer Continental Shelf, in the Gulf of Mexico, off the west coast, and off Alaska, by far the majority of the available reserves are in the Gulf of Mexico.

But having said all that, we are already drilling in a lot of areas-- including in North Dakota. I asked the U.S. Geological Survey to do an assessment of oil resources in what is called the Bakken Shale formation in North Dakota. I asked them to perform the assessment about 2 years ago. They completed their report a couple months ago, and they estimated that there is 3.6 to 4.3 billion barrels of recoverable oil using today's technology in eastern Montana and western North Dakota. So now we have nearly 80 drilling rigs drilling in western North Dakota. I don't know how many are in Montana, but there is a substantial amount of drilling activity, which I strongly support.

This is the largest assessment of recoverable oil ever made in the lower 48 States. Let me say that again. The U.S. Geological Survey just completed its assessment that there is up to 4.3 billion barrels of recoverable oil using today's technology and we have oil companies there drilling and I support it. We are drilling in this country, in North Dakota, eastern Montana, and we have other oilfields. This happens to be a brand new one, the biggest assessment ever made in the lower 48. It is exciting, in my judgment.

As I indicated, we have activity happening now in Lease 181 in the Gulf because we opened that. Off of Cuba, it is estimated that there is a half million barrels a day that is available for leasing by the Cubans. Many countries have leases there--Spain is there, Canada is there, India is there, and Venezuela is there. They are very interested. But our companies can't secure the leases because the Bush administration says, no, we can't drill in Cuban waters. We have this embargo with respect to Cuba. So there is a half million barrels that our oil companies can't produce.

I say to my colleagues: You want to drill? Let's allow our companies to go access some of that off the coast of Cuba. China wants to be there, and India wants to be there, but we can't be there.

The fact is we need to do a lot of things and do a lot of things well if we are going to address this energy issue. Now, the price of oil is bouncing around at $140, $144 a barrel. My understanding is that in the last 4 or 5 minutes of trading today, it went up, I was told, $4 or $5 a barrel. There is unbelievable, relentless, in my judgment reckless, speculation going on in the oil futures market. Now, it wouldn't matter so much if these were future markets dealing with something that wasn't so essential to the economic well-being of our country, but our country desperately needs oil. We run on oil. The fact is we use a prodigious amount of it.

I have described before, on many occasions, the way this works. We have a substantial amount of oil halfway around the world under the sands. That is where there is a lot of the oil. The largest reserve is in Saudi Arabia, second and third is either Iran or Iraq, depending on how you count reserves in those two countries. So the largest reserve is in Saudi Arabia, then Iran and Iraq. But where is the largest demand? Well, here in the United States.

We suck out 86 million barrels a day from this planet. Of that 86 million barrels of oil we suck out from these little straws called drilling rigs and pumps, we use one-fourth of it here in this spot on the planet called the United States of America. We are big users of energy.

So what do we do to address this issue when oil prices spike like Roman candles to $140 a barrel, and it does enormous damage to our country, to our economy, and injures farmers, families, truckers, and airlines? What do we do? We do a lot of everything, it seems to me.

I described that we are drilling exciting new wells in our region of the country. We are going to be drilling in Lease 181 in the Gulf of Mexico. But in addition to drilling, we need to do a lot more. We need substantial, aggressive conservation. We need significant efficiency and conservation. Everything we use throughout the day--if we turn a switch, push a button, dial a knob, turn a key--everything we do all day long has to do with energy. We get up in the morning and we want light, in the closet, in the bedroom. We use our finger to flip a switch, not understanding, of course, so much--because we take it for granted--that is energy. Perhaps we use an electric razor, then heat a pot of coffee, then put a key in the ignition of a vehicle. Every one of those actions is using energy, and we never give it a second thought.

Now, all the things we have--yes, including air-conditioners and refrigerators--can be made much, much, much more efficient. We are getting rid of the incandescent light bulb. It will not be long until you will never see another one because we can find ways to produce light for all our manufacturing facilities and our homes all across this country with 80 percent less electricity than we now use. So we need to engage in conservation, efficiency, and then renewables.

Now, renewables represent something our country ought to say to the world: Here is where we are headed. Yes, we are going to drill some and do all these things. We are going to conserve and develop more efficient methods of using all this electricity. But it is also the case that renewables represent a significant opportunity. Renewables, with respect to wind energy and solar and biomass and biofuels.

You know what we have done for renewables? Well, in 1992, the Congress put in place something called the production tax credit--a tax incentive for renewables. But it was short term and not very deep. So we have extended it five times, short term. By the way, the production tax credit will expire at the end of this year. We have extended it five times, and we let it expire three times. So anybody interested in investing in renewables will take a look at this country and say: You don't have much of a commitment to renewables. Look what you have done, stutter, start, stop. That is not a commitment.

Here is what we did for oil. In 1916, we put in place tax incentives--big, juicy, fat tax incentives--and we said: We want you to go look for oil and gas. If you find them, good for you because that is good for our country, and you get big tax incentives. We put the incentives in place in 1916 and they have stayed forever. What did we do for renewables? Well, in 1992 we gave them a tax credit, which has gone through the phases of start, stop, start, stop, expire. That is a pathetic, anemic response by a country that acts like it doesn't care very much.

I have introduced legislation in this Congress that says: You know what, we ought to put in place a production tax credit for renewables for 10 years. We ought to say to the world: Here is where we are headed, and you can count on it. Here is what we believe in, and you can count on it. This country is making a significant concerted effort for renewable energy, to be less dependent on the Saudis, the Kuwaitis, the Venezuelans, and others. That is what our country has a responsibility to do.

So we need to do a lot of things. At the moment, however, I wish to concentrate on not the myriad of things we must do and do well, but I wish to talk about the urgent need to do something that addresses this spike, this unbelievable spike in oil prices and, therefore, gasoline prices that has happened in the last 12 to 14 months.

There is nothing in the supply and demand of oil that justifies this kind of a price spike. Nothing. In fact, if anything, demand is down. Today's newspaper describes that we are using 2 percent less gasoline here in this country. The first 4 of 5 months in this country we had increased inventory of crude oil stocks. Inventory is up, demand is down. What happens to price? It goes straight up. Why? Because there is excess speculation in the futures market.

Those futures markets were designed for a specific purpose and that was to allow producers and consumers to hedge risk of a physical product--perfectly legitimate and an important thing to do. It has now, in my judgment, been taken over by excess speculation. Franklin Delano Roosevelt warned about that in 1936, when he signed the legislation that created this market.

Now we have unbelievable speculation in this market. The new pension funds and others that have come into this marketplace in a few short years have spiked from investing somewhere around $13 billion to $260 billion. Are the people flooding into this marketplace wanting to hold a 5-gallon can of oil? No, these interests never want to touch oil. They never want to own oil. They want to do what Will Rogers talked about 80 years ago: They want to buy what they will never get from people who never had it and make money on both sides. And then walk around with a permanent grin, walking into the bank with our money to make their deposits. Yes, the OPEC countries do that and so do these speculators as they have driven up the prices. The problem is it injures this country's economy.

It is devastating, for example, to various industries--the trucking industry, the airline industry, and farming to have such high oil prices. It's also devastating to ordinary consumers, trying to figure out how on Earth do I scrape up the money to fill my gas tank to be able to drive back and forth to work. How do I do that?

Now, I think we have a responsibility to address this excess speculation. When markets are broken, we have a responsibility to address it. I have often said I taught economics ever so briefly in college. I taught a little economics, and I kid people by saying I was able to overcome that experience. Economics is psychology pumped up with a little helium. People think: Well, we know this produces that, there is an action and a reaction--supply and demand. We all understand that. The problem is, at the moment, if you take a look at this country, its economy, and what the psychology of the American people is as they look at what is happening in this country, there is a pretty good reason to be very concerned about the future and a pretty good reason to believe we need action that is urgent, important action that actually has some grip and some teeth.

We have been through a subprime loan scandal. The credit markets were frozen. The fact is we had an orgy of greed in these credit markets and a lot of problems still exist. In fact, some of the resets on some of these bad mortgages are still in front of us. So take a look at that kind of a credit crisis and the subprime loan scandal and then combine that with the issue of the deficits, dramatic Federal budget deficits because we are fighting a war the President will not pay for. He says everything we use for this war, I want to borrow, and he has borrowed almost three-quarters of a trillion dollars for it. He refuses to pay for it. I will send the soldiers to war, and I ask the American people to go shopping, he says.

The subprime loan scandal, unbelievable fiscal policy recklessness, a trade policy out of balance over $700 billion a year. You can't do that. Then, on top of that, the price of oil going to $144, and we think this economy is able to withstand that? This is a resilient economy, the American people are resilient people, but they expect and demand appropriate action by this Congress.

Now, we have people who view themselves as a set of human brake pads. Their only role in life is to come to the floor of the Senate and say: Oh, no, no, no. You can't do that. We are going to dig in our heels and prevent anyone from doing anything. That is not public policy we should be proud of. We are trying very hard to construct some public policy in all these areas that give us a chance to move forward. I know there are reasons for some to object to certain activities. But we have seen, in the last 5 or 6 months, a steady stream of people coming to this floor and saying: My goal is to stop anything from happening. Meanwhile, all these issues pile up in a way I think is a danger to this country's future and a danger to our economy. It is starting with this issue of energy, as I began the discussion today.

We have a responsibility in the short term, and I know the majority leader and others believe it as well.

We have a responsibility to at least tackle excess speculation and the relentless dangerous speculation of this commodity futures market that is driving up the price of oil and injuring this country's economy.

I have introduced legislation to do that. I hope to talk about it tomorrow. Some others have also introduced legislation. We ought to take the best of the legislation that exists and move forward to address this country's problems.

I yield the floor and suggest the absence of a quorum.

Mr. President, I wish to speak in morning business, and I ask unanimous consent to use the remaining time in morning business.

Mr. President, I wish to speak about the issue of energy. I understand the urgency of the need to get our energy policies right. We have a very serious problem, I think, in a range of areas. Energy policy is something that affects everybody. They pull up to the gas pump to fill their tanks and wonder how they are going to be able to afford it. If you try to run an airline, you try to stop the hemorrhaging of red ink because of the enormous cost of jet fuel. If you have a trucking company, you are trying to avoid going bankrupt because of the cost of diesel fuel. If you have a family farm, you are trying to get the money together to fill your fuel tanks for the summer and fall harvests.

There is so much that is damaging our economy, as the price of gasoline has gone to $4-plus a gallon and the price of oil is bouncing around $140 a barrel. I wish to talk about that. I understand, as a Member of this body, that old saying is that ``when all is said and done, more is said than done.'' I understand how people feel about that. Democracy is painfully slow and, yet, in this case, we face something that is urgent and needs, I think, some haste and speed. I know there are others who look at the legislative bodies, or politics generally, and see windbags in blue suits, and they think there is a lot of discussion and precious little action. I will talk a bit about this issue of the need for action.

We get up in the morning and we, generally speaking, reach for a switch and turn it on and there is light. We might--those of us who need to--plug in an electric razor and shave in the morning. We might decide to have breakfast and turn on a stove and fry some eggs. We could go out to the car and put a key into the ignition and start the engine. There are so many different things we do every single moment of the day that we don't think about, but it represents the consumption of energy--an unbelievable amount of energy, in the form of oil, natural gas, electricity, and coal.

Now, let me describe for a moment where we find ourselves. This great country of ours--and there is nothing like it on the face of the Earth--has an unbelievable appetite for oil. Sixty to seventy percent of our oil comes from outside our country. We stick straws in the Earth and suck out oil from the planet every day. We suck 85 million barrels a day out of the planet Earth, and 21 million, or one-fourth, is destined to be used in the United States of America. That describes to you how much of an appetite we have for oil.

We use a substantial amount of the Earth's oil. Seventy percent of the oil that we use is used in vehicles. So that consumes a substantial amount of our oil.

The runup in price has had such a dramatic impact on this economy and on American families. I want to describe a bit about that today.

Some would say the price of oil has increased because it is supply and demand. Right? Greater demand, less supply; therefore, a higher price. But that is not true. I would like someone to name for me one thing that has happened in the past year with respect to supply and demand that justifies a doubling of the price of oil. You can't do it. I will stand here for 3 days. You can't do it. Nothing has happened in the last year with respect to supply and demand that justifies doubling the price of oil. If anything, exactly the opposite should have been the case. We are using less fuel in the United States right now than we did in the equivalent period a year ago. We drove about 5 billion fewer miles. That means demand is down. Supply is up.

The closing month inventory of crude oil for the first 5 months of this year has supplies increasing. If supplies are increasing and demand is down, what should happen to price? It should go down. But the fact is, the price has gone up like a Roman candle, just up, up, straight up.

As I have indicated, the OPEC countries are blissfully happy going to the bank to deposit our money in their bank accounts. The big oil companies have a permanent grin. They love depositing our money into their bank accounts. Everybody loves it except the consumer who is paying through the nose for gasoline--$4, $4.50 a gallon for regular gasoline.

There are a lot of things that need to be done in energy. We need to produce more, yes. We need to conserve more, certainly. We need more efficiency in all the appliances we use. We certainly do that. And we ought to have a national commitment toward renewable energy sources. We ought to do that, all of that.

I support drilling offshore. I am one of four Senators who helped open what is now lease 181 in the Gulf of Mexico. That is now open, and that is good. Hurricane Katrina came through the gulf--we are never going to have a bigger wind than that through the gulf--and those offshore platforms withstood. There was no oil leakage in the gulf as a result of that hurricane.

We can get those resources, in my judgment. Some say the hood ornament is ANWR. We have to drill in ANWR in Alaska. It is one of the few pristine areas put away for future generations in legislation signed by Dwight Eisenhower.

In any event, that is not where the major oil deposits are. The major deposits are in the Gulf of Mexico, and we ought to drill more there. I support that. We ought to conserve more, much more. That includes more fuel-efficient vehicles. In fact, we did that, the first time in 27 years we required a 10-miles-per-gallon increase in the efficiency of vehicles in 10 years.

There is so much we can and should do to solve this problem. But what has happened in the last year with respect to energy prices is, in my judgment, largely unconnected to what I just described. Let me tell you what I think is happening.

There is an unbelievable amount of speculation in the oil futures market. Let me describe it. This is the growth of speculation in the oil futures market. In the year 2000, 37 percent of the trades in the oil futures market was by speculators. Today it is 71 percent. That market has largely been taken over by speculators or, as Will Rogers described 80 years ago, people buying things they will never get from people who never had it and, by the way, buying it with money they never had. This is an unbelievable amount of excess speculation driving up prices.

This morning in the Washington Post there was a well-written story by a journalist named David Cho. The story was: ``Pension Funds Boosted By Oil: While Stocks Fall, Commodity Bets Are Paying Off.''

This was a story about CalPERS and other pension funds moving billions and billions of dollars into the futures market. In fact, investors, including pension funds and Wall Street speculators, have increased their investments in the futures market from $13 billion in 2003 to $260 billion today. Think of that. From 2003 to 2008, you go from $13 billion to $260 billion moving into this marketplace, which is not a particularly large marketplace. We produce 85 million barrels a day coming out of the Earth, and we trade 22 times that amount every single day. We have these dramatic amounts of additional speculation, especially by pension funds coming into this marketplace. Then we have brain-dead people walking around saying: What speculation? We don't think there is any excess speculation. This is simply the market working. Nonsense. That is unbelievable nonsense.

The article says:

For decades, trading commodity contracts was considered

taboo by most pension funds because the market is so volatile

and risky.

All of the sudden risk doesn't matter so much, I guess. Just jump in with both feet right smack into the oil futures market, grab a bunch of it, and see what happens. I don't understand that. Where do we find all the cards with which to build this house of cards?

Walter Lukken, acting chairman of the Commodity Futures

Trading Commission--

By the way, they are the regulators. They are the referees, the ones wearing the striped shirts carrying the whistles and supposed to call the fouls--

Walter Lukken, acting chairman of the Commodity Futures

Trading Commission, said the price of oil and other goods is

going up simply because demand is outstripping supply.

``It's our proposition that strong fundamentals are at

play, driving higher commodity prices across the board.''

That is our regulator saying: What, we worry? I don't see anything happening.

Let me remind everyone again of the amount of speculation that has gone up in 5 years. This market was 37 percent speculators. It is now 71 percent speculators. That is a study that was done by the House Subcommittee on Oversight and Investigations. So the head of the regulatory authority says: You know what. I don't think anything is going on. I am blissfully happy here, going to work in the mornings, and I am perfectly willing not to see what exists.

Let me describe a chart I think is one of the most interesting charts with respect to oil prices. I put this chart together to show the Energy Information Agency--we spend $100 million on this agency. They are an agency that is not about policy. They are to give us information on energy and give us their best judgments on energy prices, among other things. Here is what they have said.

The yellow line shows the following: In May of last year, they said: Here is where we think the price of oil is going to go. And in July, they said: It is going to be higher than that. Here is where we think it is going to go, up to 2009. Then in September, they made another estimate a little higher: Here is where we think it is going to go. Last November: Here is where we think the price of oil is going to go in the next year. January: Here is where we think it is going to go.

Can you imagine that? This is the best agency we have, the Energy Information Administration, with which to make judgments, and how did they make judgments that were so unbelievably wrong? I had the head of this agency before my subcommittee the week before we left for the recess. He couldn't answer the question. This must be an embarrassing chart for the smartest guys in the room.

I said: Let me answer it for you. If you can't answer it, let me answer it for you. I taught economics in college ever so briefly but enough so I think I can answer this chart.

The reason our agency has been wrong, so consistently wrong all the time every time they made an estimate--here is where the price of oil is going to go, instead it went like this, straight up--is because this market has been taken over not by supply-and-demand relationships but by speculators. They are up to their necks deep in speculation. So this line, the red line, could not possibly be determined by an agency that is looking at supply-and-demand fundamentals because this does not relate to anything except an orgy of speculation by people who want to get into the market and make big bucks so we deposit our money into their bank accounts.

The senior vice president of ExxonMobil in April said the price of oil should be about $50 or $55 a barrel. I suppose he is looking at things such as supply and demand.

Fadel Gheit came to the Congress--this guy worked for 30, 35 years for Oppenheimer Company. He was their resident expert on energy. Here is what he said:

There is no shortage of oil on the world market today. I'm

convinced that oil prices shouldn't be a dime above $55 a

barrel. I call it the world's largest gambling hall, open 24/

7. Unfortunately, it's totally unregulated. This is like a

highway with no cops, no speed limit, and everybody going 120

miles an hour.

Then the Energy Secretary, a man I like, a good guy, said:

There is no evidence that we can find that speculators are

driving the futures prices for oil.

This apparently is the new master narrative. Just say nothing is happening and then hope nobody can discover something that is happening.

The problem is, every hour of every day the American people drive up to the gas pumps and discover what politicians--at least some of them-- are insisting doesn't exist. It is unbelievable to me.

In every circumstance where there has been dramatic excess speculation in the market and the market becomes broken, it is the responsibility of the Congress to set it right.

I have introduced legislation, and there are half a dozen pieces of legislation around here to try to address this issue.

I understand we will have discussions all of July about this situation, and I understand the inclination, perhaps, by some will be to decide we ought to do something without teeth. If we can just do something and say we did something and it has no grip or bite, we can all go home, thumb our suspenders, and even puff on a cigar for those who smoke, and say: We did it, the United States Senate, good for us. It is not good for us unless it is something that has an impact on a market that is broken. Let me describe the legislation I introduced. It is called the End Oil Speculation Act of 2008. That describes exactly what it would do. It requires the regulator, the Commodity Futures Trading Commission, to separate trades in the futures market for oil. One set of trades would be trades between consumers and producers of a physical product for the purpose of hedging risk. That is precisely what the market was established to do. That is exactly what the market is about. It is why we have a futures market. A futures market is necessary and is there because it is needed to hedge risks of a physical commodity.

We would require the Commodity Futures Trading Commission to separate

those trades. Other trades then are defined as speculative trades, and a 25-percent margin requirement would be applied to those non- legitimate hedge trades. Why that? The fact is, if you are going to speculate in stocks on margin, you have to put up 50 percent of the money. If you want to control oil on margin, put up 5 percent or 7 percent maximum. Let's quintuple that to 25 percent and see if we can wring the speculators out of this market. If you are engaged to speculate on one side or another of a legitimate hedge for the trading of a physical commodity, as far as I am concerned, that is what the market is about. You should not be subject to this new requirement. But if you are just out there trying to figure out how to play bingo with this oil market, despite the fact you do not even know what oil looks like, you couldn't lift a 5-gallon can if your life depended on it, don't want to see oil, don't want to store it, you have no interest in oil--what you are interested in is making money, then this increased margin requirement should apply to you.

We have hedge funds and investment banks that are up to their necks in these markets. They have no interest in oil. We have hedge funds for the first time in history buying oil storage in order to buy it, take it off the market, store it, so that it becomes more valuable later, and they sell it and make a profit. The problem with all of this is the country's economy is being damaged, and we have a responsibility, I believe, to try to fix these kinds of problems when they exist.

I know that we will have a discussion this week and this month about four or five different approaches. And I know they will all have great labels. When I grew up, my neighbor, Herman, an old man--he had rheumatism, he wore suspenders and never traveled much off his front porch. And he had a dog. His dog was a three-legged, one-eyed dog with fleas. He called him Lucky. I thought: That name doesn't fit a three- legged dog with one eye with fleas. But Lucky actually answered to the call of ``Lucky.''

We do that with legislation around here, some of us. I shouldn't say ``us'' because I try not to do it. They package legislation and label it as if it is going to do something.

The only issue at the end of the day in the Senate in terms of dealing with this energy urgency--and I believe it is urgent--the only issue is have we done something that has some bite and grip and starts to fix a market that is broken? Have we decided to wring some of this speculation out of this market and put energy prices back where they ought to be?

Let me point out once more that, according to the House Subcommittee on Oversight and Investigations, who did an evaluation of this, 71 percent of the trades in the oil futures market is now speculative-- pure speculation--as opposed to the non-speculators who are using that market for the purposes which it was intended. I say to all those who say: You know, speculation--what speculation? I see nothing, hear nothing, know nothing. Well, I say: Look at this EIA chart again and try to figure out what this line means. Most Americans understand exactly what this line means. It is what they have to pay at the pump every time they take the gas cap off their tank. And they know where it is going. A fair amount of that is going to OPEC.

By the way, enough of that spills from the barrel to fund some terrorism. In addition to all that, a substantial amount is going to the major integrated oil companies. I might observe here that some say: Well, that is important, because they need to invest in additional exploration. The largest oil company in this country spent twice as much last year buying back its stock as it did drilling for oil. That is all you need to know about that.

The American people need this Congress to address this issue now, in the month of July. This country's economy is in substantial difficulty for a lot of reasons. We have a lot of speculation, a lot of risk created in a whole range of areas.

Take a look at the subprime loan scandal. Evaluate what has happened as a result of the collapse of home values and the subprime loan scandal--all these issues together--and what it has done to our economy. And put on top of that this dramatic runup in energy prices, and on top of that look at the President's budget where he says: Oh, by the way, I want you to pass a budget that has a $420 billion deficit.

Except that is not what the deficit is. The deficit is not what the President says it is. It is how much the President says we have to borrow to keep the Government going this year, which is over $700 billion. We have a fiscal policy off the trail, with $700 billion a year, and we will borrow $800 billion because of our trade policy this year, due to trade deficits. So $700 billion, $800 billion, and that is $1.5 trillion in 1 year of red ink, with a $14 trillion economy. That is slightly more than 10 percent of this entire economy's value represented by red ink. That is unsustainable. It doesn't work.

Look, I am an optimist. I believe we can fix all this. I believe we can put this country back on track, with a sound fiscal policy that says let's pay for that which we use. If we are going to spend money, let's pay for it. We can say if we are going to send soldiers to war, we can at least ask the American people to pay for the cost of the war. We can decide to crack down on oil speculators, and mortgage sharks who are peddling bad mortgages around the country. In all cases, whether it is the oil futures market or whether it is the financial area, it requires regulators who are not brain dead and who are willing to come to town to have effective regulation and make sure that markets work.

I believe we can fix all of these things, but we don't have a lot of time. This economy, I think, is a fragile economy. It is strong and resilient. But you lay these four things on top of it, and it becomes a fragile situation that requires action by us. I know that because I was in North Dakota all of this past week.

I saw a letter to the editor today saying: Well, the problem with all of this is the Democrats. The Democrats are causing all this. That is such sheer nonsense. Going back to 2001--talking about oil, the subprime mortgage scandal, and others--we had regulators coming to town who said: You know, we don't even like Government, and we would love to be a regulator to say we are not very interested in regulating. In fact, we don't need to put on a striped shirt. We don't have a whistle. We want to come here and say things are going to be better. We won't look.

I chaired the hearings in the Commerce Committee on the Enron scandal. I had Ken Lay come in front of my committee, raise his hand and take the oath, and then take the fifth amendment. He is now dead, but there are a number of those he worked with who are now in prison, because part of that was a criminal enterprise and the regulators weren't willing to look. Now, I am not alleging that is the case with the futures market, but I am alleging this market is broken and causing dramatic injury to every American family. This country's economy and the American people can and should expect us to take action.

My hope is that in the coming week or two we can pass some legislation. I hope that legislation will closely resemble the End Oil Speculation Act, in which we require the regulatory body to use its existing authority to do two things: Separate the legitimate hedging that occurs, and should occur in this marketplace, from excess speculation, and then wring out the excess speculation in order to begin to put some downward pressure on prices.

The American people deserve the right to expect that from their Government. I hope my colleagues and I can overcome what has been for too long in this Chamber a dramatic amount of stalling and obfuscation by those who dig their heels in and don't want to make any progress on anything. So my hope is that perhaps in the coming month we will be able to make some progress.

Mr. President, I yield the floor, and I suggest the absence of a quorum.