Floor Statements

Mr. President, I ask that the Chair lay before the Senate a message from the House of Representatives on the bill (S. 403) to amend title 18, United States Code, to prohibit taking minors across State lines in circumvention of laws requiring the involvement of parents in abortion decisions.

The PRESIDING OFFICER laid before the Senate the following message from the House of Representatives:

Mr. President, on behalf of the majority leader, I move to concur in the amendment of the House and send an amendment to the desk and ask for its immediate consideration.

I ask that the reading of the amendment be dispensed with.

I ask for the yeas and nays.

Mr. President, on behalf of the majority leader, I send a second-degree amendment to the desk.

Mr. President, I ask unanimous consent that reading of the amendment be dispensed with.

Mr. President, on behalf of the leader, I send a cloture motion to the desk.

Mr. President, I ask unanimous consent we now return to morning business.

Mr. President, I ask unanimous consent that when the Senate completes its business today, it stand in adjournment until 9:30 a.m. on Thursday, September 28. I further ask consent that following the prayer and pledge, the morning hour be deemed expired, the Journal of proceedings be approved to date, the time for the two leaders be reserved, and the Senate proceed to a period of morning business for up to 30 minutes, with the first 15 minutes under the control of the majority leader or his designee, and the final 15 minutes under the control of the Democratic leader or his designee; further, that following morning business, the Senate resume consideration of S. 3930, as under the previous order.

Mr. President, today we were able to reach an agreement on the military tribunal legislation. We have disposed of one amendment today. The Levin substitute amendment was defeated this afternoon. The Specter amendment is pending, and there will be some additional debate time on that tomorrow. Under the agreement, we have three other amendments to consider and then final passage of the bill. Therefore, Senators can expect rollcall votes throughout tomorrow's session.

As a reminder, the majority leader has outlined a number of items that we need to complete before we leave for the recess. We will be here until we can get these items finished.

Mr. President, if there is no further business to come before the Senate, I ask unanimous consent that the Senate stand in adjournment under the previous order, following the remarks made by the Senator from Illinois for up to 10 minutes.

Mr. President, does the Senator from Illinois require more than 10 minutes?

Mr. President, I amend my request that the Senate stand in adjournment under the previous order following the remarks of the Senator from Illinois for up to 20 minutes.

Mr. President, I thank my friend from Oregon for his overly kind remarks. I have enjoyed working with him on this particular project. It is very clear he has the initiative on this legislation, but I am happy to respond to his initiative and lend what assistance I possibly can.

I want to make just a few additional comments about the presentation he has made. I have always been very nervous about CAFE standards. For those who are watching and don't know what CAFE standards mean, it has nothing to do with lunch, but it comes from the acronym CAFE, or corporate aggregate fleet emissions, having to do with automobiles.

I have always thought that whenever government gets in the way of the market, government tends to make mistakes with the market. I think we can look back over the years of the CAFE standards, and in an effort to get lower emissions and more efficiency out of our automobiles, we have had a situation where manufacturers have had to make cars people don't want to buy, just to make the CAFE standard requirements. I am always nervous about that. That is one of the reasons I have been hesitant to support CAFE standards.

Here is a solution that will create incentives for people to buy lower emission automobiles, or more efficient automobiles, without dictating what those automobiles will be and without dictating a Federal target. It simply says: If you buy a car that gets higher mileage than the CAFE standard average, to a certain extent, as the Senator from Oregon has explained, the Federal Government will give you a rebate. Now, it is a tax rebate. It is a tax credit. So that is cash in your pocket if you pay income taxes, and 50 percent of American wage earners do not pay income taxes. This is one of the things we have to understand. The income tax is so constructed that it applies only to the top 50 percent of Americans, and the majority is paid by the top 5 percent of Americans.

So you can say: Well, the tax credit isn't really fair because only the people at the top get to take advantage of it. So in the bill that the Senator from Oregon has crafted and what I am cosponsoring, a car buyer can say: Instead of the tax credit, once the whole deal has been made, the price negotiated, I want my $630 or my $1,000 or my $1,800 or whatever it might be on the deal to go against my responsibility for a downpayment.

Now, we very carefully have not put it in a situation where it can be part of a deal because we think the car dealer will say: Ok. I will simply raise the price by the amount of the rebate and do a little bait and switch and not give strong economic incentives for somebody who really understands what is going on to buy this particular car. The dealer doesn't know when the buyer comes in whether the buyer is going to take the amount as a tax rebate directly to the buyer or whether he is going to apply it to the downpayment. So the dealer cannot do any bait and switch or smoke and mirrors to try to take advantage of that. That is one of the talking points in favor of this particular approach.

But it means, as the Senator from Oregon has said, that the government now becomes technology neutral. The government says: We don't really care whether the increased mileage comes as a result of a hybrid or, as one auto manufacturer said, improved diesel, or some other technology that no one has thought of. This means that someone who is working on additional technology that needs a little bit of a nudge to have people buy it doesn't have to put that aside and say: Well, I can't compete with the subsidy that is created for hybrid. I have something that will get just as good mileage as a hybrid, but I can't put it on the marketplace because the present law says you get so much of an advantage for hybrid but not for this new one that I have come up with. So the government stays technology neutral and tax neutral in terms of the impact on the people who get the advantage of it, and the manufacturer deals directly with the customer in producing the kinds of automobiles people want to buy. And if people say: I really don't want to buy that automobile, if CAFE standards disappear, the manufacturer can say: OK, if you don't want to buy it, we won't produce it. Whereas, now there is pressure; we have to produce it in order to meet the CAFE average, whether people want to buy it or not.

Economics is all about incentives. This is the right kind of government intervention to create incentives that I think ultimately will correct some of the wrong kinds of government intervention, however well intentioned, that we have seen.

So I am delighted with the leadership shown by my friend from Oregon. I am happy to work with him on this issue, as I am working with him on other issues. I think it is an example of the kind of bipartisan approach to solve the Nation's problems that we all need to follow. I congratulate him, salute him for his leadership, and I am happy to be part of the team.

Mr. President, I thank my friend from Oregon for his overly kind remarks. I have enjoyed working with him on this particular project. It is very clear he has the initiative on this legislation, but I am happy to respond to his initiative and lend what assistance I possibly can.

I want to make just a few additional comments about the presentation he has made. I have always been very nervous about CAFE standards. For those who are watching and don't know what CAFE standards mean, it has nothing to do with lunch, but it comes from the acronym CAFE, or corporate aggregate fleet emissions, having to do with automobiles.

I have always thought that whenever government gets in the way of the market, government tends to make mistakes with the market. I think we can look back over the years of the CAFE standards, and in an effort to get lower emissions and more efficiency out of our automobiles, we have had a situation where manufacturers have had to make cars people don't want to buy, just to make the CAFE standard requirements. I am always nervous about that. That is one of the reasons I have been hesitant to support CAFE standards.

Here is a solution that will create incentives for people to buy lower emission automobiles, or more efficient automobiles, without dictating what those automobiles will be and without dictating a Federal target. It simply says: If you buy a car that gets higher mileage than the CAFE standard average, to a certain extent, as the Senator from Oregon has explained, the Federal Government will give you a rebate. Now, it is a tax rebate. It is a tax credit. So that is cash in your pocket if you pay income taxes, and 50 percent of American wage earners do not pay income taxes. This is one of the things we have to understand. The income tax is so constructed that it applies only to the top 50 percent of Americans, and the majority is paid by the top 5 percent of Americans.

So you can say: Well, the tax credit isn't really fair because only the people at the top get to take advantage of it. So in the bill that the Senator from Oregon has crafted and what I am cosponsoring, a car buyer can say: Instead of the tax credit, once the whole deal has been made, the price negotiated, I want my $630 or my $1,000 or my $1,800 or whatever it might be on the deal to go against my responsibility for a downpayment.

Now, we very carefully have not put it in a situation where it can be part of a deal because we think the car dealer will say: Ok. I will simply raise the price by the amount of the rebate and do a little bait and switch and not give strong economic incentives for somebody who really understands what is going on to buy this particular car. The dealer doesn't know when the buyer comes in whether the buyer is going to take the amount as a tax rebate directly to the buyer or whether he is going to apply it to the downpayment. So the dealer cannot do any bait and switch or smoke and mirrors to try to take advantage of that. That is one of the talking points in favor of this particular approach.

But it means, as the Senator from Oregon has said, that the government now becomes technology neutral. The government says: We don't really care whether the increased mileage comes as a result of a hybrid or, as one auto manufacturer said, improved diesel, or some other technology that no one has thought of. This means that someone who is working on additional technology that needs a little bit of a nudge to have people buy it doesn't have to put that aside and say: Well, I can't compete with the subsidy that is created for hybrid. I have something that will get just as good mileage as a hybrid, but I can't put it on the marketplace because the present law says you get so much of an advantage for hybrid but not for this new one that I have come up with. So the government stays technology neutral and tax neutral in terms of the impact on the people who get the advantage of it, and the manufacturer deals directly with the customer in producing the kinds of automobiles people want to buy. And if people say: I really don't want to buy that automobile, if CAFE standards disappear, the manufacturer can say: OK, if you don't want to buy it, we won't produce it. Whereas, now there is pressure; we have to produce it in order to meet the CAFE average, whether people want to buy it or not.

Economics is all about incentives. This is the right kind of government intervention to create incentives that I think ultimately will correct some of the wrong kinds of government intervention, however well intentioned, that we have seen.

So I am delighted with the leadership shown by my friend from Oregon. I am happy to work with him on this issue, as I am working with him on other issues. I think it is an example of the kind of bipartisan approach to solve the Nation's problems that we all need to follow. I congratulate him, salute him for his leadership, and I am happy to be part of the team.

Mr. President, we are debating the Energy bill, the bill that would allow drilling in deep sea waters off the coast of the United States in the Gulf of Mexico. We have heard a lot of conversation about that. I don't want to repeat all of the arguments that have been made, but I want to put it in a perspective that I think might be useful to some who would be watching.

Of course, we have this debate against the backdrop of $3-a-gallon gas. Everyone gets excited about that, and they say it is caused by $75-a-barrel oil, and what can we do to bring down the price of oil? The law of supply and demand determines what the price might be.

There are those who think that is determined ultimately by oil costs, but that is not true. It is determined by the world market, and the United States is only one country that is drawing on the world market and asking for this oil to fuel our economy.

We must start with the understanding that the world runs on oil right now in a variety of ways and in a variety of places, which means that everyone in the world--whether they are in China or India, in Europe or the United States--needs oil.

Why oil? Why don't we have other kinds of energy? The answer is that historically oil has been the cheapest source of the energy we need. People said: Well, let's have wind, let's have solar. Wind and solar up until now have been unable to survive unless there is a serious government subsidy for it. As soon as the subsidy is withdrawn, all of a sudden we can't afford to generate energy from these other sources because it is cheaper to generate it from oil. So we have the infrastructure for oil built up, we have the infrastructure for gasoline for our transportation system built up, and it would take an enormous investment and a great deal of time to try to change it. So people need oil.

All right. There is plenty of oil in the world, and it is relatively cheap to produce in some parts of the world. But what is known as the lifting cost--that is, what it costs to lift a barrel of oil out of the ground and put it into that tanker--for Saudi Arabia is about $1.50. You can produce a barrel of oil at a cost of about $1.50 in Saudi Arabia. The lifting costs elsewhere are much higher than that.

If we come to my home State of Utah, where we have more oil than they have in Saudi Arabia, the lifting cost to get all of that oil is around $30 to $40 a barrel because the oil is locked up in rocks known as oil shale. That is why we don't produce oil from oil shale--not because it isn't there but because it can be produced more cheaply someplace else.

Since it is a world market, people put their oil on the world markets, and the world law of supply and demand determines what will be paid for it. The key number to keep your eye on to determine what the oil is going to cost is

the excess capacity that is available. Let me explain with some numbers.

Right now, the world as a whole is using about 85 million barrels of oil a day. The world capacity to produce oil is about 86 million barrels a day. These figures are not exact. They never are. They change from day to day. But let us use them as representative figures to illustrate the point.

All right. If you are in a position where you have to be sure you can get your oil for your future needs and you look at the world situation and say: You know, there is only a million barrels a day of excess capacity out there, and that million barrels a day could disappear with the snap of a finger--a problem in Iran, a decision by the oil minister in Saudi Arabia, another outburst--explosion, if you will--by the new President of Venezuela. A million barrels a day is not enough excess capacity to guarantee me that my oil will be there when I need it, so I will bid a higher price than I normally would pay just for the certainty that the oil will be there when I need it.

So the oil goes from $50 a barrel to $60 a barrel to $70 a barrel. We have seen it approaching $80 a barrel. Then when word comes out: Well, that excess capacity is a little more than a million barrels a day. Well, I may not want to bid quite so much for the oil. And the price will settle down a little. When there are indications that the supply of oil will be more secure in the future, the price starts to come down.

This is what we see in what is called the futures markets because people are buying oil for the future. They are making long-term contracts.

All right. The key ingredient in bringing the price of oil down is to make sure the surplus capacity above the amount of oil we use gets bigger and bigger. Right now, as I say, it is only about a million barrels per day. If it were 2 million barrels a day, if there were an additional source of oil, then the price would come down because you would have a bigger cushion to be sure you can get your oil in the future.

Look, there is overcapacity of 2 million a day. Back in the days when oil was available for $30 a barrel or $25 a barrel, the excess capacity was 5, 6 and 7 million barrels a day. People were comfortable making long-term contracts because they knew that excess capacity would make the oil available to them.

Just as a side note, in this body, we approved, along with the House of Representatives, back some 6 years ago authority to drill in Alaska. President Clinton vetoed that bill. It takes about 6 years for that kind of investment to bring oil on line. If the bill President Clinton vetoed had been signed, we would have an additional million barrels a day of oil on line in the world right now. That would virtually double the amount of excess capability that is currently available. But that was not done. We are where we are.

That is why this bill we are debating is so important--not just for the amount of oil that is there but for the amount of increased capacity it will deliver to the world markets when it comes on line. And then what happens? Then, by virtue of that amount of excess capacity above the amount the world is using, the futures price for oil will start to come down. That is the way the law of supply and demand works. Around here we have never been able to figure out a way to repeal the law of supply and demand. That particular law trumps virtually everything else we do.

That is one of the reasons I am supporting this bill, to say the time has come for the United States to have that impact on the world price of oil by virtue of our ability to produce that additional capacity.

But there is something else here as important as oil with respect to what is available to us in what we call area 181, and I am talking about natural gas. The same thing that I have to say about the impact of excess capacity on oil applies to natural gas. Natural gas is something more than just energy. This is why natural gas is doubly important. Yes, we use natural gas to heat our homes. We use natural gas to cook our meals. We use natural gas to generate electricity. Natural gas is the fossil fuel of choice. Everyone wants it. Everyone says it is clean, it is plentiful. Historically, it is cheap. Let's put in natural gas. When everyone wants it, that means the demand for it goes up, that means the supply gets tight.

We discovered a few years ago something about natural gas that is very obvious but that some people had not realized. Natural gas is the one form of energy we cannot import. Natural gas gets imported by pipeline. The only place we can bring in natural gas once we have tapped all of the natural gas available in the continental United States is by pipeline from Canada and Mexico. There is a lot of natural gas elsewhere in the world, but we cannot bring it to the United States because it comes in by pipeline.

Now, it can be liquefied. It can be put on a ship. It can come here as LNG, liquefied natural gas, but we don't have that many ports that can receive LNG. It is a very major financial investment to build the port, to equip the port to handle LNG, to build the tankers that can handle LNG. There are those who are doing that, but in the meantime the amount of natural gas available in the American economy is confined by the rising demand.

Natural gas, the petrochemicals in natural gas, are a critical element of the chemical industry. When the price of natural gas goes up, the price of all of our chemicals goes up. It is a critical element in the fertilizer industry. We are proud of our capacity to produce enough food to feed all of America and still make it a major export, but we cannot do it if the cost of fertilizer drives farmers off the land. And the cost of fertilizer is tied to the cost of natural gas.

When you realize that in area 181 there is not only enough oil to change the balance of the overcapacity that can bring down the futures market in oil, there is also enough natural gas to have a significant impact on the price of natural gas and help us with lower costs in the chemical industry, lower costs in agriculture, lower costs with fertilizer across the board, you realize that opening this area for exploration and drilling is something that should have been done a long time ago.

We know one of the main reasons why it was not. It has to do with State interests and State concerns about what will go on. This bill very cleverly and carefully crafts a series of royalty incentives to get the States on board.

With Senator McConnell, I went down to Mississippi and then to New Orleans to see firsthand the devastation. In the presentation that Senator McConnell and I received was an exposition of the damage out in the Gulf of Mexico to those lands that have acted as some kind of a barrier for future hurricanes. That area desperately needs to be rebuilt. It needs to be rebuilt for economic reasons, it needs to be rebuilt for environmental reasons. It is in serious trouble. The State can't afford to rebuild.

But with the revenues that are in this bill for the State of Louisiana, there is a possibility that they can start to rebuild and produce enormous benefits for all of their people and for all of the country. This becomes a source of revenue that can be dedicated to that particular ecological activity that is good environmentally and good economically.

So you put it all together, you have a bill that I think should pass unanimously. I know it won't. We never do anything unanimously around here unless it is completely noncontroversial, and something of this kind always has a little controversy connected to it. It probably comes as close to being the right bill at the right time in the right place as anything we have seen.

A year ago we passed a comprehensive energy bill that has us started down the road toward increased nuclear activity with respect to creating electric power. This bill, coming a year later, is a logical companion piece to the bill we passed a year ago because it starts us down the road toward alleviating the upward pressure, the constant upward pressure on the price of oil and the price of natural gas and doing it in a way that those States that have previously resisted this kind of economic activity now say we understand and we will participate in a beneficial way. That is why this bill is bipartisan. That is why it is supported by the Senators from the States most heavily hit by Katrina and the other hurricanes that occurred.

One of the things Katrina taught us that should give us further comfort as we debate this bill is that our technology for deepwater drilling is sufficiently stable that it can withstand a

hurricane of Katrina's force and not produce any kind of an oil spill, not produce any kind of an ecological difficulty.

It is interesting to recognize the greatest ecological damages from oil spills have come from tankers bringing oil across the ocean, rather than from oil platforms drilled in the ocean. If we want to reduce our dependence upon the oil being shipped in the most dangerous way in terms of the environment, we should pass this bill and proceed with this activity.

It comes as no surprise that I express my strong support for this bill for economic reasons, for environmental reasons, and for long-term planning reasons. It is, as I say, the right bill at the right time and in the right place.

I yield the floor.

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

Mr. President, I ask unanimous consent that there be a period of morning business, with Senators permitted to speak for up to 10 minutes each.

Mr. President, I ask unanimous consent that the Senate proceed to the immediate consideration of S. 3741 introduced earlier today.

I ask unanimous consent that the bill be read a third time and passed, the motion to reconsider be laid upon the table, and that any statements relating to the bill be printed in the Record.

Mr. President, I ask unanimous consent that the Senate proceed to the immediate consideration of the conference report to accompany S. 250, the Carl D. Perkins vocational education bill.

I ask unanimous consent that the conference report be agreed to and the motion to reconsider be laid upon the table and that any statements be printed in the Record.

Mr. President, I ask unanimous consent that the Senate immediately proceed to executive session to consider the following nominations on today's Executive Calendar: Nos. 771, 772, 774, 775, 776, 777, 778, 779, 780, 781, 782, and 785. I further ask unanimous consent that the nominations be confirmed en bloc, the motions to reconsider be laid upon the table, and that the President be immediately notified of the Senate's action, and then the Senate return to legislative session.

Before the Chair rules, I note for the record that with respect to Calendar No. 779, the Mishkin nomination, if a vote were held, Senator Bunning is opposed to the nomination and would have been recorded as a ``no'' on confirmation.

Mr. President, I ask unanimous consent that when the Senate completes its business today, it stand in recess until 9:30 a.m. on Thursday, July 27. I further ask that following the prayer and the pledge, the morning hour be deemed to have expired, the Journal of the proceedings be approved to date, the time for the two leaders be reserved, and the Senate proceed to the consideration of S. 3711, the Gulf of Mexico Energy Security bill, as under the previous order.

Mr. President, today, we invoked cloture on the motion to proceed to the Gulf of Mexico Energy Security bill, and we have had a full day of debate.

Tomorrow, we will be on the bill and Members are encouraged to come to the floor and speak. Again, this is a very carefully crafted bipartisan bill. It is very targeted and will move us closer to energy independence. So we hope we can finish the bill at the earliest time.

We have other important issues to address before we finish our work prior to the August adjournment. Therefore, the leader hopes that we can continue to work on other measures as we process this important energy security measure.