Mr. President, I ask unanimous consent to speak as in morning business. Mr. President, like so many of my colleagues, I spent the week of the Fourth of July traveling my State of South Dakota. I met with members of the general public at an…
Mr. President, I ask unanimous consent to speak as in morning business.
Mr. President, like so many of my colleagues, I spent the week of the Fourth of July traveling my State of South Dakota. I met with members of the general public at an energy forum, met with small businesses, folks in the tourism industry. Everywhere I went it was the same story: High gas prices are crippling the American economy.
I remember stopping in the small town of Parkston and visiting with someone who manages a small cafe there, and visiting with them about the impact that high gas prices are having on their business.
She said: Well, it is not really the weekend travelers, the RV owners, the people who camp, but it is those people who are commuting to work every single day who now do not have the money to eat out nearly as often.
Of course, Parkston is a small town. It is about 20 miles, give or take, from Mitchell, SD. There are a number of people who commute back and forth. It is those commuters who are feeling the most economic hardship as a result of high energy prices.
I attended my parents' 65th wedding anniversary in my hometown of Murdo. In my hometown, tourism, the visitor industry, is the very lifeblood of that community. I grew up in that business, worked in restaurants, motels, that sort of thing. And I even had a forum, as well, with members of the tourism industry in South Dakota in Rapid City when I was home just to gauge the impact of high fuel prices on their individual businesses.
The Rapid City mayor, who owns a campground, said: I think we are going to reach a tipping point where the very foundations of the travel industry could be shaken.
Bill Honerkamp, president of the Black Hills, Badlands and Lakes Association said tourism fell about 7 percent in the region in May, and numbers for the rest of the summer are barely holding steady.
Teddy Hustead, president of the popular South Dakota tourist stop Wall Drug, said tourist stops were down 1 percent in June. But he went on to say that Wall Drug needs to be up 4 to 5 percent to be a healthy, growing, viable concern, and it is hard to grow a business when gas is increasing by 10, 20, and 25 percent every single year.
Sean Casey, the vice president of another popular South Dakota tourist destination, Bear Country USA, noted that visitation is down 7 percent for the year 2008. And he went on to say: Energy is pinching us. I always joke that we are going to a model like the space shuttle-- two visitors at $10 million each.
Jo Casky of the Spearfish Convention and Visitors Bureau noted that convention is dropping because of high gas prices. One particular convention was booked with a prediction of 1,200 to 1,400 attendees. That is unlikely now because of the rising pump prices.
Casky said: We are now at about 800. As soon as gas started getting to the $4 mark, we started to see reservations back off.
High gas prices are having a dramatic impact on families, small businesses, the tourism industry, the airline industry, the agricultural industry, and virtually every sector of the American economy.
I toured a UPS facility in Sioux Falls, SD. Many of my colleagues may have heard what they are doing in terms of dealing with the price of fuel. They actually now, as they diagram routes for their drivers, diagram routes that only allow them to make right turns so they do not sit in a left-turn lane and idle thereby using more energy.
My point is that people are taking extraordinary steps to deal with the high cost of energy. Higher costs for companies such as UPS, transportation companies, get passed on to consumers in the form of higher prices for everything they buy. They are looking for leadership in Washington, DC. But instead of leadership, they have seen a decade of inaction, as arguably the most important issue of impacting the American economy has been left unattended.
We have done nothing to affect the basic law of supply and demand. Some argue, and perhaps rightly so, that high energy costs are partly a function of the weak dollar. They would be, as I said, accurate to say that because oil is denominated in dollars. When it takes $1.57 to purchase a Euro, it is going to make anything denominated in dollars more expensive.
There are those who think speculators are driving up the cost of energy in this country, and it is true that trading in energy commodities has increased dramatically over the past 30 years since the exchanges were created. I, for one, happen to believe we need to look for ways to define the degree to which speculation is impacting energy prices in this country and also look at what we can do to address that issue in a way that makes matters better and not worse.
Trading since 2004 on the NYMEX Exchange has nearly tripled. So we need to make sure our farmers, our ranchers, our airlines, our trucking companies, have the opportunity and ability that they need to manage risk. That is what those markets were created for. We also need transparent markets where all traders are subjected to the same sets of rules.
I believe we need more cops on the beat. We need to make sure the CFTC has the funding it needs to do its job and to enforce our laws. I think we can do some things, such as codifying CFTC position limits and transparency for foreign boards of trade. I guess my point is that there are a number of things we can do to address the impact that speculators may be having on the price of energy in this country. And, frankly, I think that is a role and responsibility that Congress should fill.
But if you take the weak dollar, and you take speculators out of the equation, we still have a major problem and a major crisis in this country. That problem is that we have greater demand for energy than we have supply. We use about 86, 85 to 86 million barrels of oil every single day worldwide. Of that amount, the United States uses about 20 million barrels or about 24 percent of the total. Of that amount of 20 million barrels that the United States uses every single day, about 12 million barrels are imported.
In other words, 60 percent of the oil that we use every single day in America comes from outside the United States. We are transporting and shipping and transferring about a half trillion dollars every single year of American wealth outside of the United States to petro dictators who are being enriched by that American wealth and using it in ways that I think most of us would disagree with; in fact, in many ways to support terrorist organizations in places around the world.
Now, we cannot solve our dangerous dependance upon foreign sources of energy absent affecting that basic law and rule of supply and demand. We have to find more energy in this country. We should be taking steps now to add supply and to reduce our demand.
One of the things we need to continue to support and intensify, in my view, is our commitment toward renewable energy. I want to read something that Tom Friedman said in an op-ed on June 29. The op-ed was titled ``Anxious in America.''
But he said:
My fellow Americans. We are a country in debt and in
decline, not terminal, not irreversible, but in decline. Our
political system seems incapable of producing long-range
answers to big problems or big opportunities. We are the ones
who need a better functioning democracy. More than the Iraqis
and Afghans, we are the ones in need of nationbuilding as it
is our political system that is not working.
He goes on to say:
I continue to be appalled at the gap between what is
clearly going to be the next great global industry, renewable
energy and clean power, and the inability of Congress and the
administration to put in place the bold policies we need to
ensure that America leads that industry.
Well, one of the things that we did, and it was a moonshot in terms of renewable energy and making an investment in our future, is the renewable fuels standard. Last December there were 80 Senators who voted to increase the renewable fuels standard to 36 billion gallons by the year 2022. That was a policy that was put in place less than a year ago, and yet already we have people, Members of the Senate, politicians in Washington, who are talking about rolling that back. That could be the absolute worst thing that we do.
We do not need less energy in this country, we need more energy in this country. We need more renewable fuels. The 8 or 9 billion gallons of renewable energy that we produce in this country every single year today is taking pressure off gasoline and oil prices by, according to a study conducted by Merrill-Lynch, up to about 15 percent.
In the current market economy that is about 50 to 60 cents per gallon of gasoline. Someone has said it is ethanol and corn prices that are driving up the cost of everything we buy in this country, and particularly with regard to this whole food-versus-fuel debate. But the American Truckers Association recently did a study which found that in late 2004 it cost about 16 cents per box of cereal to transport that box of cereal to the marketplace. Today it costs about 36 cents per box of cereal. So we have seen a 20-cent increase in the transportation cost for a box of cereal. Couple that with the fact that the amount of corn in a box of Corn Flakes is about 10 cents per box, and you can see what is driving up the cost of everything in our economy. It is the increasing price per barrel of oil, increasing price of energy in this country.
We need to speed cellulosic ethanol to the marketplace. We need to increase the blends of ethanol. We need not fewer gallons of renewable energy in this country, we need more gallons of renewable energy. I hope those in Washington, in the administration and Congress, who are talking about considering rolling back the renewable fuels standard would reconsider that and think about the importance of renewable energy and what it can do for America's future and our dangerous dependence on foreign sources of energy.
The second thing, of course, we have to do is we have to increase our domestic supply. That means the Outer Continental Shelf. That means the oil shale in places in the Western States. It means ANWR. It means coal to liquid. It means nuclear. It means wind. We have all of these domestic energy supplies in this country, and we have heard people say it would take 5 to 100 years to develop some of these energy supplies. Well, that is what they were saying 5 or 10 years ago about many of these same things.
We did not do it then, and now we are paying a price for it. Is it not our job as policymakers to be looking down the road to future generations to make decisions that are in the best interests of America's future. There is not any issue, I would argue, that is more important to America's future than energy security because it ties directly into and correlates directly into our national security.
We have to have more domestic supply, and the last thing we have to do is we have to use less. We have to find more sources of energy, more domestic sources of energy, so we do not continue to get 60 percent of that energy from outside the United States. And we have to figure out ways in this country to use less energy.
I have a bill that I have introduced. I am on a bill that Senator McConnell, the Republican leader, has introduced which has 43 cosponsors. I have introduced a bill of my own to deal with this energy situation. I am working with a group of both Republicans and Democrats. We need to put the politics aside, the partisanship aside, and work on getting a solution for the American people.
In the bill that I introduced, one of the things I include is a provision that requires that of additional Government lands that are leased for energy production--whether they be offshore, whether they be oil shale in the Western States, whether it be ANWR, the lease revenue, half of the lease revenue that comes into the Federal Government be plowed back into research and development and new technologies, in renewables, alternative sources of energy, things like plug-in hybrid cars, cellulosic advanced biofuels, hydrogen fuel cells.
Those are the types of things we also need to be investing in to make sure that not only are we increasing the supply of energy in this country, the amount that we have, but also that we are using less.
We can do this. We can put aside the finger-pointing and the blame game and do something for our energy future. I believe when people come together, and when they decide that this is an important priority for America's future, we can get this done.
But we can't do it by saying no to every proposal put on the table. My colleagues on the other side--many of them; not all, but many--have said no to offshore production, no to oil shale, no to nuclear, no to coal to liquid, no to additional refinery capacity. We can't solve this problem by saying no. We have to start saying yes to more domestic production and to more measures that would allow us to conserve and reduce the amount of energy we use. We have to get serious about this issue. It starts with addressing that fundamental law and rule of supply and demand. We can do all these other things, the dollar can start firming up, we can address the role of speculation in the marketplace. But at the end of the day, we don't solve the problem unless we get serious about increasing our domestic supply of energy and reducing and using less energy. When we do that, we will see the price per barrel start to come down, the price per gallon of gasoline start to come down, and we will see the American economy, in places such as South Dakota, where tourism and agriculture are so critically important, start to rebound and start to draw more visitors to the tourism industry and to make sure our farmers continue to produce food and fiber in a way that allows them to maximize their return on investment and not get choked with high input costs coming from higher energy costs.
I hope before we adjourn for the August recess, we will come together behind an energy proposal and plan that is good for America's future, that emphasizes renewables, more domestic supply and production, and addresses the important issue of conservation. But we can't do that by continuing to say no. I ask my colleagues on both sides to quit saying no and to start saying yes to America's energy independence. Say no to our dangerous dependence upon foreign energy but yes to making America energy independent and making this country more prosperous for America's future.
I yield the floor.