Mr. BINGAMAN. Madam President, I wish to take a few minutes to discuss what has become a very tortured topic for the entire country; that is, the prices for oil and gasoline and diesel.

I would like to respond, first, to the President's misstatements about Congress's role in this situation. These are misstatements he made on Tuesday at his press conference. Then I would like to talk about what I believe are some of the real causes of the energy situation and what constructive steps we can take to address those causes.

First, with regard to the President's statements, on Tuesday he suggested the Congress is to blame for the current price situation Americans are seeing when they go to fill up at the gas pump. He cited three reasons to conclude that. 

First of all, he was blaming Congress for preventing oil companies from exploring for oil and gas in the United States. Second, he was blaming Congress for blocking efforts to build more refineries in the United States. Third, he was blaming Congress for blocking increases in the U.S. nuclear electricity production capacity. 

Frankly, I think the President's comments are disappointing in several regards. First, of course, they are very partisan. But second, the charges the President made are simply not borne out by the facts. 

On exploration and production of natural gas in this country, Congress has taken significant steps on a bipartisan basis to enhance oil and gas production. Through enacting the Gulf of Mexico Energy Security Act of 2006, Congress made available 4.74 trillion cubic feet of natural gas and 1.26 billion barrels of oil off the Florida Panhandle. 

Ironically, Congress was required to pass that law because of steps that were taken early in the Bush administration. In her first year in office, in 2001, Secretary of the Interior Gale Norton cut the size of the scheduled Outer Continental Shelf lease sale in the area by 75 percent. So with the stroke of a pen, the Secretary of the Interior, in 2001, put off limits over 6 trillion cubic feet of natural gas and over 1 billion barrels of oil from an area that had been proposed for leasing by the Clinton administration, I would say, with the concurrence of our former colleague, Lawton Chiles, who was then the Governor of Florida. 

So while, undoubtedly, a politically popular stance for the Bush administration in Florida when this action was taken by Secretary Norton, this was hardly an action that was intended to enhance oil and gas production in the country. 

In fact, large areas of the Outer Continental Shelf are currently off limits to oil and gas development and production not just because of congressional moratoria but because of Presidential withdrawals that were first put in place, in 1990, by the first President Bush. This current President Bush could exercise real leadership in this area, if he wished to, by eliminating these Presidential withdrawals that were first put in place by his father. 

We are talking about a significant area. There are some 574 million acres of the OCS, or Outer Continental Shelf, that are unavailable for leasing, and virtually all that is covered by Presidential withdrawals, which could be eliminated by this President with the stroke of a pen. 

The Arctic Refuge is another issue raised by the President. He failed to mention drilling in the Refuge will do nothing to address the high price of gas people are faced with today. I think everyone who has looked at the issue recognizes that not a single drop of oil would come to the lower continental United States from the Arctic Refuge for at least 10 years. 

The Energy Information Administration has estimated that production from the Arctic Refuge would, at its peak, reduce our reliance on imports by about 4 percent, from 68 percent to 64 percent. That is the estimate the Energy Information Administration has given, which, of course, is part of our own Department of Energy. 

Other areas of Federal lands that are much more appropriate for development can and should be drilled. In fact, of the 45.5 million acres of Federal onshore lands currently under lease by industry, there are over 31 million acres of those lands that are not currently being produced. Likewise, there are 33 million acres of Federal Outer Continental Shelf that are under lease; that is, the Government has done what it should do to make these areas available, but they are not being produced. 

The processing of drilling permits on Federal lands has surged over the past several years. It has more than doubled between 2001 and 2006. At the same time, the administration reported that in five key basins in the Rocky Mountain States, 85 percent of oil resources and 88 percent of natural gas resources are currently available for leasing and for development. 

Congress has also funded important research and development programs to enhance the best of production. It is simply inaccurate finger pointing to say that Congress is impeding oil and gas development in this country. 

On refinery capacity, which is the second point the President made in his press conference, refining capacity has increased by about a million barrels per day during President Bush's tenure, from 16.6 million barrels per day in 2001 to 17.5 million barrels per day in 2007 through capacity expansion and existing refineries. There have been no efforts from Congress to try to slow down that expansion. Refiners have been asked whether they would like to build new refineries as opposed to expanding capacity at existing refineries, and those refiners have told us in hearings before our Energy Committee that they would rather expand capacity at existing refineries. We have never heard support from anyone inside the oil industry regarding the President's curious plan to build refineries on former U.S. military bases. As far as I know, no Member of Congress objects to that; it is just that the companies that are in the business of constructing refineries have not decided that it makes good sense for them from an economic point of view. 

The economics of refining are not very good at the moment, as gasoline prices are not yet fully reflecting the jump in crude oil prices. U.S. refining capacity is at about 85 percent utilization at the current time, as many refiners are losing money on every gallon of gasoline they produce. Clearly, constraining refinery capacity is not our current problem. 

The third issue the President attacked the Congress about was nuclear energy production. Here again, Congress is not standing in the way of increasing nuclear production capacity. In fact, Congress over the past 3 years has put in place one of the most favorable sets of incentives for nuclear power development anywhere in the world. 

For example, if a nuclear plant is proposed for licensing and is delayed because of a lack of action by Federal regulators, the proponents of the plant can get Federal payments to compensate for that delay. Now, that was part of the 2005 legislation we passed. No wind power developer can get that kind of a subsidy. No solar power developer can get that kind of a subsidy. We also provided tax incentives for the construction of new nuclear powerplants. So if the Congress passes global warming legislation--I know the administration and the President are opposed to that, but if we do, according to the Energy Information Administration, the most significant impact of that global warming legislation would be to provide a powerful new incentive to promote more nuclear power development in this country. 

So let me move on from the discussion of the President's charges to a short discussion of what I consider the real causes of current oil prices. I think to understand what is going on here, it is critical to put these oil prices in the broader economic context. The current increase in oil prices is, to a large degree, a symptom of our ailing economy. Oil prices and the value of the U.S. dollar have been very strongly linked over the last year. As the value of the dollar declines, oil prices go up. 

We have heard recent testimony before our Energy Committee that confirms that investors are seeking protection from inflationary risks associated with the weak dollar and from credit and wider financial markets in which they have lost confidence. As one witness put it, oil has become the new gold, and that is why speculators and others are investing in oil. Higher oil prices in turn weaken our economy, so we are caught in a downward spiral in which a weak economy is resulting in high oil prices, and high oil prices are, in turn, further weakening the economy. 

So the question is how do we stop this downward spiral. This is a large task. It requires, first and foremost, a return to rational fiscal policy that will restore balance and investor confidence in our markets. That includes an honest accounting of the costs of the war in Iraq, a figure that we now know is going to be in the trillions of dollars. Spending has also been accompanied by the administration's tax policies which have been extremely damaging to the country's long-term fiscal health. Every American family that sits around the kitchen table and tries to balance a budget recognizes the simple fact that spending more than you earn or more than the revenue you can bring in results in, after a period, your creditors eventually coming calling. That is what is happening to the dollar today. Apparently, the stewards of the U.S. economy and this administration have failed to absorb that simple reality.

Let me talk a little about policies to reduce oil prices in the short term. There are modest but important measures we can enact to increase our oil supply and reduce our demand. On the supply side, we need to immediately stop removing oil from the market to fill the Strategic Petroleum Reserve. It simply makes no sense to be putting $120 per barrel oil underground. According to the most recent Energy Information Administration forecast, oil demand in the United States is expected to decline by 90,000 barrels per day in 2008. This is the kind of signal we need to send to the market in order to see some relief from current prices. However, we are taking 70,000 barrels per day off the market to add to the Strategic Petroleum Reserve which we all recognize is about 97 percent full right now. We are basically wiping out any positive effects from the decrease in demand. This is a policy completely wrongheaded and should be stopped immediately. I compliment all three of the candidates for President for embracing this recommendation that we eliminate the filling or we suspend the filling of the Strategic Petroleum Reserve. I wish the administration would support that simple measure. 

On the demand side, we need to decide whether we are ready to get serious about educating consumers to take more responsibility to reduce consumption. We know that 5 miles per hour slower that a person drives will increase our fuel efficiency for that individual by about 7.5 percent. We also know that energy-efficient, properly inflated tires increase fuel efficiency by about 4 percent. Regular car maintenance can increase fuel efficiency by about 2 percent. So Americans individually could use about 10 to 15 percent less gasoline by adopting these commonsense measures. But to see we do that, we will need publicity out there to educate folks on the simple steps they can take to reduce consumption. In the medium term, we need to ensure there is a cop on the beat on the oil markets. 

There are two key steps we should take to improve Government oversight of the oil markets. First, the Secretary of Energy needs to have a role in overseeing oil markets. It troubles me that the people at the New York Mercantile Exchange on which oil is traded and the Commodity Futures Trading Commission which regulates that exchange seem to be the only people who think that speculators are not influencing oil prices. 

Here is a quote from the Wall Street Journal on March 21 of 2006. It says: 

Hedge funds are taking ever-larger bets in a futures market that is smaller than the stock or bond markets, and the funds are using borrowed money to maximize their bets, magnifying the impact on energy market prices. 

So clearly, the Secretary of Energy and the 500-plus employees he has there in his Energy Information Administration who work every day to analyze energy data, forecast energy supply and demand, and prices should at a minimum provide insight and advice to market regulators at the Commodities Futures Trading Commission. Perhaps this could help the Commodities Futures Trading Commission come to understand the role of speculators in that market. 

Second, we need to shed light on the so-called dark markets. Markets that trade U.S. oil or are located in the United States should be subject to U.S. regulation. It is unacceptable that an exchange that is based in Atlanta, GA and trades U.S. crude oil that is delivered in Oklahoma is regulated in the United Kingdom, not subject to the laws and regulations that we in Congress put in place to govern the U.S. futures market. It is also unacceptable that over-the-counter markets are regulated neither here in the United States nor in the United Kingdom. There is simply no regulatory body that can see these over-the-counter transactions. 

Let me also say a few words about policies that will not reduce gasoline prices. First, there is a proposal to suspend the tax on gas and diesel. While I can appreciate the temporary public relations success that might accompany this tax suspension, it would come at the expense of fiscal common sense and sound energy policy. I agree that high gasoline and diesel prices are hurting consumers, but additional deficit spending will only help accelerate the downward trajectory of our economy as a whole. This is simply the latest in a long line of proposals that seek to score political points during an election year at the expense of good energy policy. 

There are three main objections to the proposal. First, it would increase deficit spending by nearly $10 billion while saving motorists about $25 per person. If you do the math, you find that even if all of the savings are passed on to the consumer, which is a very unlikely outcome, the savings per person is negligible. 

If you assume that the average motorist drives 12,000 miles per year and gets 22 miles per gallon, you can calculate that the amount the average person would save in a 3-month period is $25.50. So adopting the fuel efficiency measures I have discussed earlier, including shaving a few miles per hour off the top highway speed, would be much more effective in reducing the cost of gasoline to the average consumer.Madam President, the second argument I wanted to raise related to this proposed suspension of the gas tax is the idea that it would be reinstated in September when prices might well be as high or higher than they are today would be very difficult and very unlikely to occur, frankly. We are talking about reinstating the gas tax in September. I think that is the proposal the Senator from Arizona has made: Let's suspend the gas tax now, or at Memorial Day, and let's reinstate it on Labor Day. Well, the problem with that is Labor Day is about 2 months before the election. It would not be politically feasible to have a single-day price increase on September 1st of 18.4 cents per gallon for gasoline and 24.4 cents for diesel. I don't think anybody--any politician in his or her right mind--would vote to impose that kind of a tax increase at that time. Prices could easily be as high or higher on September 1 as they are today. It is simply not possible to me that Congress will then choose to increase the price that consumers pay at the pump.

The third argument is that this tax suspension would stimulate demand for motor fuels without increasing supply. In fact, we would see something in the nature of a price increase. The best explanation of this was done by Paul Krugman, a respected economist who writes for the New York Times and teaches at Princeton, in an article he did on April 29. He said in that article, I think the conclusion was, the McCain gas tax plan is a giveaway to oil companies disguised as a gift to consumers. 

The obvious point he was making is that under the basic rules of economics, the fact that Congress would suspend the gas tax would do nothing to ensure that consumers benefited from the suspension of the gas tax. The whole notion that you are going to see the price of gas at the pump drop 18 cents because Congress says the tax is all of a sudden suspended is not realistic. 

In conclusion, we as a country and we as a Congress need to get serious about energy policy. It is an election year. While there is always a tendency to take rhetorical stands in the runup to an election, the American people understand that. I think they discount what they hear from Washington as the election date begins to arrive. That is one reason they don't always hold Congress in the highest esteem. Proposals that are mostly feel-good propositions do not fool voters for long--if they fool them at all.

That said, there are a number of concrete steps we can take that will help. We should freeze the filling of the Strategic Petroleum Reserve--suspend that for the time being. We should take some effective actions to bring the oil markets under better control with U.S. laws and regulations. Let's be sure consumers know what they themselves can do to reduce their own demand. I hope that with oil at $110 to $120 per barrel, which it has been for several weeks and which it may well be for several more weeks or months ahead--or even a longer period--I hope we will give this topic the serious attention it deserves. 

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