senator manchin of west virginia and i have introduced just such a bill. it's a bipartisan bill. it's called "the american alternative fuels act." this bill truly would ease americans' pain at the pump. it would repeal barriers to alternative fuels so that american energy can thrive. it would promote the production of alternative fuels derived from american sources. this bill acknowledges the truth about our energy crisis. we need more american energy, we need it all well, in addition to the green jobs that the president keeps talking about, we need red, white and blue energy and red, white, and blue energy jobs. we must keep focusing on making our energy as clean as we can, as fast as we can and do it in ways that do not increase the

costs on american families. the only way that americans can take the president's call for more energy production seriously is if he and the democrat leadership abandon their fixation on raising taxes on producing american energy. that is the first step we need to do in helping relieve pain at the pump. mr. president, i yield the floor and note the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

a senator: i ask unanimous consent that the quorum call be lifted. the presiding officer: without objection. mrs. hutchison: mr. president, i rise to speak in opposition to the menendez proposal which would raise taxes on a handful of our nation's energy producers. mr. president, this bill makes the assumption that raising taxes on the five major oil companies will somehow reduce the deficit and lower the price at the pump. this is misguided, and it will also have the opposite effect. raising taxes on our domestic oil industry will drive up gasoline prices, and who in america that is driving a truck or a car doesn't realize that

gasoline prices are already very high? secondly, it will threaten the jobs, nine million jobs depend on drilling exploration and operating in america. if we drive these countries overseas, it will increase foreign imports and it will stop the jobs that are being created in america. those who threaten to repeal these deductions fail to recognize the tremendous costs and risks that go into exploring for the energy needed to drive our country forward. mr. president, our oil and gas industry is an industry, a business that creates jobs like any other industry or business in our country. why would we single out one sector of our economy and say

you can't deduct your expenses? every other business in america can deduct expenses. other manufacturing businesses in america can get the taxes that are credited for manufacturing jobs because we want to keep jobs in america, and it offsets the very high corporate tax rate that we have in our country that the president has recognized as being too high, because we want to keep manufacturing jobs, there is a credit for manufacturing. but we're going to take that away if the menendez bill passes and send those jobs overseas. we are making it so hard to create our own natural resources from our own people working in this country, and we're sending them overseas at a time when we ought to be wanting to create

jobs, we ought to be giving every possible fair break to companies that will hire in america. and yet, now we're going to take one sector of the industry and tax them differently from every other sector since. since business started in our country, we have had tax deductions for expenses, and yet here we are trying to say that we're going to take one sector of the industry and maybe they're doing too well right now, and so we're going to tax them more. well, look out other industries that happen to be successful right now, whether you're making kleenex or computers, you're going to be taxed. if you earn too much, is that really what america wants to change as our business policy, which is -- which has a foundation of fairness and

equity. we have a corporate tax rate that is so high that it encourages businesses to go overseas. now we're going to single out one industry that wants to do work in america, that wants to bring our natural resources out of the ground and bring down the price at the pump, but no, we're going to add taxes so that we will not see any lowering of gasoline prices at the pump, we're going to increase it. if we increase the cost of doing business and we force these companies to go overseas to get a fair and stable regulatory environment, then we're going to pay more at the pump, no doubt about it. now, senator landrieu and i introduced bipartisan legislation earlier this year called senate bill 516, the lease extension and secure act of 2011, known as the lease act.

it restores time lost as a result of the offshore moratoria by extending the impacted leases by one year. it is fair and it is simple. now, over the weekend, the president stated that he would be extending leases in the gulf of mexico that were affected by the moratorium, but he wasn't clear about which ones. he didn't say i will extend every lease that went through the processes to get the environmental and the safety restrictions in place. they got the lease. then they had a moratorium, so now they're paying people. they are continuing to have all of the expenses of the lease, but they don't get to do the exploration. what we're trying to do is say whether you were in the exploration phase or in the drilling phase, it doesn't

matter. if you are impacted by a moratorium on a lease that you're still paying for and you're still paying people to try to keep people on the payroll, your lease will be extended for one year. that's all senator landrieu and i do. the secretary of the interior at a hearing this morning in the senate said that they were looking into extending gulf of mexico wells directly impacted by the moratorium, meaning only those leaseholders which have already performed all seismic tests and were conducting exploration drilling. this will only cover 33 leases out of thousands that are still affected by the moratorium, because they are in the exploratory phase, not the exploratory drilling phase. this year alone, over 350 leases are due to expire. many of them have not had the

opportunity to be developed because of the moratorium. the development of oil and gas in the gulf of mexico is an extremely expensive and technical process. it takes about three years of tests, surveys and appraisals before even drilling for the exploration well. regardless of which stage all of the exploration leaseholders are in, the administration ordered all leaseholders to halt exploration activities when its moratorium was enacted. every one of those leases are still being paid for, but they are not able to be explored. we need to restore at least one year of the moratorium so that they get fairness for the money that they have spent and also for the people that they have kept hired, not sending them

away, which has been a hardship on many companies, including some having to go bankrupt because they could not afford to be idle while they also were meeting a payroll. the exploration and development of oil and gas must follow a meticulous process, and any delay such as a moratorium can derail an exploration plan, causing companies to have to give up on their leases. the length of a deepwater offshore lease is usually about ten years because that's what it takes to get all the way through the exploration and the exploration drilling phase to determine if it is worth actually drilling, and many times when you drill you get a dry well. our commonsense legislation has bipartisan support. recently, the office of management and budget stated the administration fully supports suspensions for gulf of mexico leaseholders directly impacted by the drilling moratorium, but

the administration fails to recognize that all leaseholders in the gulf of mexico were directly impacted by the drilling moratorium. james noey, the executive director of the shallow water coalition, wrote me to express his support for the lease act. in the letter, he said -- "without the lease act, vast quantities of proven and producible oil and gas in these expired leases will be trapped. leaving the resources trapped will hurt our domestic production and delay when these resources can come online." i received another letter from the president and c.e.o. of phoenix exploration, a small phoenix-based company. he wrote that the lease act is vital to phoenix exploration and other small offshore companies because they have been prevented by the administration from

industrialing in the -- drilling in the moratorium and have not been able to evaluate many of their gulf of mexico leases, which have been fully paid for through the competitive bidding process. he goes on to say that the time lost from the moratorium makes it very difficult for shallow water, independent operator toes to put together the -- operators to put together the partnership and attract the resources needed to develop leases. the lease act is needed to give offshore energy producers the certainty they need to obtain proper financing to produce domestic oil and gas. so, mr. president, i ask unanimous consent to put the letters that i have read excerpts from in the record. the presiding officer: without objection. mrs. hutchison: and, mr. president, let me just close by saying that i hope that we will not do something so wron

wrongheaded and counterintuitive as to take one section of an industry and say, you're bigger than all of the others and so we're going to tax you differently. we're not going to give you the manufacturing tax credits that we give to every other manufacturer in the world, including the big ones that manufacture in the united states, and we are also going to tax you differently from the smaller oil and gas companies because you're big and they're small. mr. president, i mean, really? is that -- is that america? is that the country that wrote a constitution that said we would guarantee due process of law, that you wouldn't single out one company that is bigger than the others and tax it differently? that's not what our country was founded on. we should have a fair process. we should have fair taxation.

we should be encouraging manufacturing in our country because these companies have a trust with their shareholders. we expect them to do well for their shareholders and they have millions of shareholders that depend on them to do the right thing with their business and with the investment that these shareholders have made. i might add that many pensions are dependent on these kinds of stocks that expect the c.e.o.'s to run the companies in a way that will keep our economy going, keep jobs in america, and keep their stockholders in a position where retirees can live on the income. and, mr. president, we are singling out an industry and saying, no, you're too big, and so you're going to be taxed differently from other industries. and you don't get the

manufacturing incentives that even other big manufacturers get. why wouldn't they move overseas to create jobs overseas where they have a stable regulatory environment, a lower tax base, a lower tax rate, and where they can bring oil up from the ground and import it right back into america? but it will be at higher price because you're going to have it pay for the people to go overseas and haul the oil back. does that really make sense, mr. president? it doesn't make good business sense, and it certainly doesn't make good economic sense. it is not good for our country, and it's certainly not good for the job market that we are trying to build. so i hope that we will not make the mistake of going forward on the menendez bill. i hope that we will realize that we are a country that has vast natural resources, and we should

be using those resources so that our businesses can thrive, so that prices stay loarks so that people will not -- so that prices stay low, so that people will not be strained to put gasoline in their trucks to go to work or do their farming or ranching, to contribute back to the economy. i hope that we will defeat the menendez bill, and i hope that we will adopt a policy that will come through the mcconnell bill tomorrow that will increase exploration, increase production, lower the price of gasoline through our own natural resources, not by importing our own -- the jobs that ought to be in america -- exporting the jobs and importing the product. that doesn't make sense. let's keep the jobs in america, and let's keep our natural resources working for us. that would be the prudent thing to do, and that will be the mcconnell bill, and i hope we

can defeat the menendez bill and maybe we can come together in the senate and give the president a bill that will ask that we have more production and give the level playing field to all of the companies that would hire more people and create jobs in america. and they will do it if there is a level and fair and stable regulatory and tax environment in america. thank you, mr. president. i yield the floor. the presiding officer: the senator from colorado. mr. udall: mr. president, before i begin my remarks, i know the hour is drawing near when we will have a vote and the time limits are approaching as well. i would ask unanimous consent that the full text of my remarks be included in the record. the presiding officer: without objection. mr. udall: thank you, mr. president. i rise today, as many senators have, to talk about the energy-related votes that we face this week in the senate n my home state of colorado and in the presiding officer's home

state of pennsylvania, all over our country, americans are feeling the sting of rising gas prices. and pain at the pump puts a ceil crimp in the budgets of hardworking families and business everywhere. and i hear this every time i am back in my home state and listening and visiting with the folks there. they think it is unfair, and i have to say, i agree. rurun aiway gas price -- runaway gas prices are not fair. it is our job to bring a stop it it. instead of pursuing some commonsense goals that would move our economy forward, that involve a comprehensive energy proposal, we're here punching away at each other on issues largely unrelated to our energy independence and the prices that americans pay at the pump. i am going to support the vote today. we ought to reduce tax breaks for the five largest oil companies but i really have to say, i wish this had been part

of the larger discussion on a comprehensive energy strategy that would allow us to lead the global economic race. that said, i am going to vote to repeal what i think are needless tax breaks for big oil. traditional energy production has received billions of subsidies over the last 70 years -- 70 years -- and the top five oil companies in particular make billions in profits that far exceed the need for more government support. and i happen to agree with thousands of coloradans who have been in touch with me to say, these companies, which are among the biggest in the world, don't need and shouldn't receive taxpayer money, especially as we playbook for ways to consolidate our -- especially as we look for ways to consoli date our dax coate code. the bill is is limited to the top five companies and doesn't include smawcialtion independent produce theirs provide loot of jobs in colorado. should i note that there's some tax credits like the production tax credit for wind, the investment tax credit for solar,

and the intangible drilling cost tax credit for small oil and gas producers that are important to jobs in colorado canned across our country. we would agree the ideal energy market would be free from any tax credits but i also want to make sure that we invest in our domestic energy industries that still need help getting off the ground. as with most policy matters, this is a delegate balance. so let -- this is a delicate balance. so let me remind down my remarks with this question to my colleagues: that we would take responsibility for our economic future and get serious about energy independence. that means that we ha we'd haveo shed some of our doctrinaire positions and what's too often i think hey on the floor a "my way or the highway" approach. there are ways to responsibly drill for oil while also reducing our energy production.

there are ways to harness natural gases a bridge fuel while also spurring a generation of electric cars. these aren't either/or propositions, mr. president. and i think we especially have to seize the clean energy opportunity that's in front of us so that two, four, ten years from now we're not still sidetracked by political infighting because we've once again failed to make the tough decisions. a comprehensive energy policy is critically important to our nation's economic recovery and our long-term energy future. believe me, americans are ready for it. in fact, they're deand i demand. thank you, mr. president. i will yield the floor. mr. president, i'll note the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

mr. franken: thank you. mr. president, i rise today in strong support of senator menendez's bill to eliminate subsidies to big oil companies. at a time when we have to make tough choices to address our budget dflt deficit, when queer cutting cancer research, at a time when minnesotans are paying $4 gallon at the pump and when oil companies are raking in record profits, twoaf stand up and say, enough is enough. it is time to end the subsidies. that's why i'm prou a proud cosr of the bill. we have had to make a lot of tough choices and there are plenty still to come. to avert a government shutdown, congress enacted billions of dollars in cuts. some were pretty hard for me to swallow, frankly. cuts like $182 million from job

training, $650 million from community development funds that help communities provide basic services like roads and sewers and affordable housing; even pell grants for summer school. these are cuts that will be felt by working families and people who are still struggling to find jobs and make ends meet. i voted for the spending bill that contained those cuts, not because they'd be the cuts that irecuts thati'd choose to make e it was important to keep the government oavment addressing our budget deficits will take compromise and it will take shared sacrifice from everyone. that includes big oil companies that are making record profits because the world price of oil is now at $100 a barrel. the bill before us would end $1.2 billion in subsidies to the

five largest oil companies in fiscal year 2012 and $21 billion over the next ten years. these companies make up three of the top five fortune 500 companies, and have had nearly $1 trillion in profit 0 over the last decade. while high oil prices are gouging the pocketbooks of american families, these companies are on pace for a record profit this year. in the first quarter alone, these companies collectively made about $35 billion in profits. i would like to ask my colleagues, how high do oil prices have to go, how big do the oil companies' profits have to be before we can talk about doing away with these -- their

handouts? these companies have legacy wells that pump oil at a cost of about $10 a barrel, a little less. on average, oil production costs them $15 a barrel. when exactly don't they need these subsidies anymore? they're making record profits. now, at $100 a barrel, why do they need the subsidies? if oil goes up to $102 a barrel or $110 or $150, can they give us the subsidies back then? thes absolutely no rational -- there is absolutely no rationale for these subsidies. none at all. how much money do these companies have to make before they don't need the government's

help any more? well, to me, it sounds like these companies don't need to be subsidized by taxpayers. president george w. bush thought so too. in 2005, he said -- and i quote -- "with $55 oil, we don't need incentives to oil and gas companies to explore. there are plenty of incentives." when testifying before congress in 2005, one oil executive stated that removing many of these tax breaks would have no effect on his company's production activity. today with oil prices close to $100 a barrel, it's doubly true. let me say something about house speaker boehner's statement on the debt limit last week. the speaker told us in terms of dealing with the deficit,

everything is on the table except for revenues. how can we not look at billions of dollars in handouts to some of the most profitable companies in america? you know, this is sort of like a family that can't pay its bills, and they can't pay for food and heat and electricity and medical bills and the mortgage all at the same time. so they gather around the table and say, dad says to make ends meet, everything's on the table. we're paying for this stuff except for one of us getting an extra job or working more hours or somehow bringing in more money. we can't do that. and the son says, "gee dad, i could do more hours at t.g.i. friday's." no son, that's off the table. no more medicine for grandma.

you go play with your x-box some more. revenue's off the table? especially subsidies that don't do anybody any good? that just doesn't make any sense, and it tells me that some of us aren't really serious about fixing the budget deficit. a recent report from the joint economic committee concluded that -- and i quote -- "repealing or modifying the tax incentives discussed in this report would have little or no impact on consumer energy prices in the immediate future." in 2010, 60% of the big five oil companies' profits went to stock buybacks and dividends to shareholders, not to exploration. so even if they had fewer taxpayer subsidies and could only use, say, 59% of their

record profits for buybacks and dividends this year, i'm pretty sure they could get by just fine. now, some of my colleagues on the other side of the aisle think we've got just the wrong approach. they don't want us touching big oil's government handouts. instead they're pushing an alternative bill that would require the government to approve or reject a drilling permit in 60 days, or it would be deemed automatically approved this is a very dangerous idea. just this morning i asked director bromwich who heads the agency in charge of offshore permitting, what he thought about this idea, and he said "we'd all be at greater risk from such a proposal." this just shows that some of my colleagues have not learned the lessons of the b.p. oil spill

where a shoddy approval process and numerous industry errors led to a monumental disaster in the gulf. this disaster brought economic hardships for thousands and cost 11 workers their lives. let's not forget that. offshore drilling is becoming an increasingly complex industry to insist on a one size fits all permit process, ignores increasingly technical challenges that offshore drilling presents. the republican bill is reckless and irresponsible, and i urge my colleagues to reject it. so instead of ending handouts to wildly profitable companies, my friends on the other side of the aisle are suggesting we throw caution and safety to the wind and continue to dole out these subsidies. they want to make cuts to job training programs, pell grants

and cancer research. they've proposed converting medicare into a voucher program which would end the long-standing guarantee that our seniors will have access to health care when they need it. it would end medicare as we know it. but when we talk about touching one penny of big oil subsidies, they say it's off the table. i believe americans come together in tough times and make sacrifices. we're all not going to get everything we want, and that includes big oil executives. at a time when almost 14 million americans are unemployed, at a time when job training and other assistance programs are being cut, it's unconscionable for companies making record profits to refuse to do their part. it's unconscionable for them to

refuse to give up even one penny of subsidies that they, frankly, don't need. mr. president, i urge my colleagues to get serious about the deficit, to support senator menendez' bill and to end these wasteful handouts. i yield the floor. the presiding officer: the senator from utah. mr. hatch: mr. president, today we are discussing a bill to raise taxes. that's what it is. according to the joint committee on taxation, s. 940 will raise taxes by $21 billion over ten years. and what provoked this bill to raise taxes? this time it's high gas prices. i wish i could say i'm surprised, but since democrats took control of this chamber and since president obama was elected, this seems to be a recurring theme. no matter the question, the

answer always seems to be: raise taxes. there's rarely any consideration of how this impacts the economy, how it impacts businesses and families that have to shoulder this load. my colleagues on the other side of the aisle too often look at working men and women as an endless source of cash that washington can rely on for more governmental programs. the democratic party's emblem is the donkey. sometimes i think they would be better off transitioning to a one-trick pony. the democratic bill that we will be voting on later today is called the closing big oil tax loopholes act. that is certainly one message test in name. big oil, check. tax loophole, check. never underestimate the left's ability to underestimate the american people. they think just because american citizens are angry at high gas prices that they're going to run off the cliff and support a measure just because it mentions

big oil and tax loopholes. i can tell you that the people of utah are not going to support this bill, and the american people won't either. the american people want, and they need, energy solutions. according to a "usa today" gallup poll, seven out of ten americans say that gas prices are causing financial hardship. increased fuel charges from 6.5% to 8.5%. by the time 2011 ends, expect restaurant prices to be 3% or 4% higher according to the u.s. department of agriculture. the issue of high gas prices is much greater than the price at the pump. the joint economic committee concluded that the weak u.s. dollar has added 56 cents to every gallon of gas. now, this is a drag on a fragile economic recovery. it inflates the prices of everything from groceries to school supplies. just recently we found out that one in seven americans are on

food stamps. one in seven. one writer dubbed this the food stamp recovery. and this weak recovery has made weaker by higher gas prices. and the to deal with -- and to deal with this, democrats decide rather than to promote a sensible energy policy, it is better to score a few cheap political points at the expense of the politically unpopular oil companies. americans are rightly upset about the cost of gasoline, but the solution to higher gas prices is not to raise taxes. raising taxes on domestic energy producers might be a good thing for hugo chavez, but it does nothing to lift the burden of increasing gas prices that really is afflicting the american economy and working families. under this bill, hugo chavez's sit tkpwoe would receive a -- citgo would receive a tax incentive while u.s. companies like exxon and chevron would

not. i was amazeed to see the advocates of this legislation admit as much during a hearing on this matter last week in the finance committee. mr. president, i ask that i be given an extra five minutes for my remarks. the presiding officer: without objection. mr. hatch: one after one, my democratic colleagues acknowledged the obvious. the policies that they were proposing -- higher taxes on oil companies -- had absolutely nothing to do with energy policy or sound tax policy, and everything to do with generating more revenue for more government spending. they acknowledge that this legislation would do nothing -- i repeat -- nothing to lower the price of gas at the pump. not a thing. they acknowledge that. i can see now why senator landrieu of louisiana and senator begich of alaska called this tax increase proposal a -- quote -- "gimmick" and -- quote -- "laughable." these are two democrats who have

been honest about what's going on here. raising taxes will do nothing to lower the cost of fuel. for what it's worth, this bill won't help pay down the deficit either. nothing in this bill man tkhaeuts these new rev -- mandates these new revenues will be dedicated to deficit reduction. any new increase in this bill will be set aside and added to what we call savings on o.m.b.'s savings score card, revenue that could be used to pay for future legislation. we all know that when we increase taxes, our colleagues on the other side are going to spend every dime of it. that's been -- that's just been a matter of fact. so let's be clear about what's going on here. democrats want to increase taxes to pay for more government spending. they have been refreshingly open about their intentions. one of my colleagues state that had this bill will allow us to spend money on cops and pins. another said it will -- quote -- "raise a significant amount of additional revenue for important

projects in the united states of america." but the choice here is not lower taxes versus assistance for public safety and children. if democrats want to pay down the deficit and have money for essential projects, there are plenty of objects, or options available besides increasing taxes. my colleague from oklahoma, dr. coburn, who has led a one-man crusade to identify hundreds of billions of dollars in wasteful and redundant government spending and programs, if the entire democratic caucus spent even half the time investigating wasteful government spending as it does looking through the internal revenue code for ways to increase our taxes and to malign business like big oil, our fiscal situation would be much better. make no mistake, that this bill is a tax increase on american jobs. under this proposal, there is a

disincentive for domestic energy producers to invest in the united states. and under this proposal, american corporations will be at a competitive disadvantage with their foreign counterparts. and under this proposal, a lot of our oil companies, especially the larger ones, are going to find it a lot better for them to work offshore overseas, away from america to find oil, which is their doing anyway, without all of the tragic tax increases that come their way in our country. sometimes we talk ephemerally about the impact of tax increases on the economy. in practice, this bill is a direct assault on american jobs, and for what? it does not do anything to bring down the cost of energy. nothing. nada. and it does not do anything to bring down the deficit. not a thing. but what it does manage to do is

gloss over the obama administration's lack of energy policy. or should i say war on energy? this administration has an energy policy designed to increase costs at the same time that it purports to stand shoulder to shoulder with working families that can't make ends meet because of these increased energy costs. this is the president's energy secretary steven chu -- quote -- "somehow we have to figure out how to boost the price of gasoline to the levels of europe." unquote. now that's astounding to me. some of those levels are approaching $10 a gallon. quote -- "somehow we have to

figure out how to boost the price of gasoline to the levels in europe." unquote. the administration is talking out of both sides of its mouth. at the same time that it feigns sympathy for the families hit hardest by rising energy prices, it attempts to impose a radical environmental agenda on an unwilling middle class. at the same time that american families move to the suburbs so they can have room to grow and play, buying minivans and s.u.v.'s to accommodate their growing families, the environmental left is pushing its agenda of urban living, public transportation and, yes, small families. for all of its righteous aiger about high gas prices, it's clear from its policies where the administration stands on this fight. now, as a senator who has worked hard to establish a strong energy foundation for america, i have watched with dismay as president obama's done everything in his power to tear

that foundation up, aggressively stop domestic energy production, and leave our nation vulnerable to our foreign competitors who are smart enough to develop their own energy resources. since taking office, president obama has cut new energy leases by more than 60% in this country and by more than 80% in my home state of utah. we've got a lot of oil there. it's just a matter of getting the permits to be able to drill for it or to develop it in the case of tar sands and oil shale. in utah, colorado and wyoming, they have an estimated 1.6 trillion barrels of recoverable oil through oil shale and tar sands. we're all aware of the president's efforts to forestall domestic energy development offshore, but less media attention has been given to his successful efforts to move the energy industry off our federal lands in the intermountain west. the department of interior oversees more than 42% of the

state of utah, including much of the land where domestic energy production is pursued. one of the early moves of the secretary of interior, ken sal gla my colleague and -- ken salazar, my colleague and dear friend, was his controversial withdraw of energy leases that had already been auctioned off and paid for by energy developers after years of jumping through environmental hoops. years. some estimate about seven years, maybe longer. jumping through environmental hoops. and then just by a stroke of a pen, they withdraw 77 leases that had been paid for. mr. president, this is a terrible signal to our domestic energy producers and companies are now leaving our federal lands in droves seeking a less hostile regulatory environment on private, state and foreign-owned lands.

get that foreign-owned lands part. they're finding it's easier. they don't have all the rigamarole and red tape to go through to develop oil on land and overseas. in the absence of federal constraints, energy companies would be investing an additional $2.8 billion in the rockies if they didn't have all these constraints and all of this rigamarole to go through. and, mr. president, s. 940 is terrible policy in a long line of terrible policy. it is lousy energy policy and it is lousy tax policy. increasing taxes on american production will only stifle our economy. if democrats want to have a conversation about tax policy and tax reform, we're ready to have that conversation, but don't single out through selective taxation one industry to take away these particular tax benefits that have been useful in helping us develop

domestically our oil. but we should not be exercising our power to tax in a punitive way that singles out particular unpopular industries. or just particular industries. fortunately, i don't think that the american people are going to buy this latest installment of "let's raise some taxes." they always leave out the latter part, "so we can spend more and claim that we're doing more for the people," when, in fact, they're spending us right into bankruptcy. now, this bill that we are debating today will not do anything -- not anything -- to address high gas prices, and its democratic supporters have acknowledged this. nothing to help us with lower prices at the pump. it won't do a thing. but what it will do is raise revenue for the federal government to spend. yet again, the party of big government has proposed additional taxes to fund that big government. you see, the deficit is not the democrats' problem.

no. for the democrats, the deficit is always somebody else's problem. it is the fault of business or individual citizens for not doing their -- quote -- "fair share" or accepting their -- quote -- "shared responsibility" to fund this government. these are new terms that are being used now. the american people deserve better than this bill. i urge my colleagues to vote against the motion to proceed to s. 940 and to support the motion to proceed to s. 953 when we take it up tomorrow. now, mr. president, i know a little bit about oil, a little bit about developing oil and i know one thing -- we have lots of oil in our country if we'll just give the permits and allow the development of that oil. and it doesn't take any brains to realize we have all kinds of oil offshore. so for the froze go down to bra -- froze go down to brazil, give them -- president to go down to brazil, give them a $2 billion subsidy to drill

offshore, and then compliment them for having done so, with riggs that were probably in the gulf of mexico before basically it was shut down and then say that we'll buy your oil from y you, i mean -- i mean, it's laughable. absolutely laughable. and not develop our oil here in this country? we know there's all kinds of oil in alaska. we know there's all kinds of oil in anwr. if you were to go to anwr, you'd be shocked at how really barren the place is. and yet to hear the environmentalists talk, you'd think it was the most beautiful, lush part of the planet. the fact of the matter is, is that we can develop oil there without ruining anwr and help our country in the process. and save the taxpayers an awful lot of money and keep our country strong. and make us not dependent on big oil or anybody else. wouldn't it be wonderful if we could just have some good free market principles and allow our

people to find our own energy in our country? a lot of people didn't realize until it came out last week that the united states is the third largest energy producer in the world. now, we're the largest user by far but there's a reason for that. we've been the most important country with the greatest economy, helping people all over the world with our tax dollars. mr. president, i hope we vote down this bill today and vote the one up tomorrow. i yield the floor. mr. schumer: mr. president? the presiding officer: the senator from new york. mr. schumer: mr. president, first, even though i don't agree with him, it's always a pleasure to listen to my friend from utah give his arguments, but i will just give mine instead of talking to him. just remind him of one thing. this bill is not intended to lower gas prices. it's intended to reduce the deficit. it clearly does that. and if my colleague cares so

much about reducing that deficit, the oil companies are a good place to start. money does not go for spending, it goes for deficit reduction. anyway, i rise today in support of the legislation authored by my good friend from new jersey, senator menendez. senator menendez has championed this legislation for quite some time and i applaud the work he's done to build support for it. as you know, our leader, senator reid, has scheduled a vote on it in just a few minutes and i sincerely hope the bill will pass. nothing would be better in terms of showing bipartisanship and giving the american people hope that we can come to a fair agreement on our long-term fiscal challenges than to pass this legislation today. now, in the last election, voters gave those of us who serve in this chamber two distinct mandates. first and perhaps foremost, they said make the economy grow. create good-paying jobs.

make sure that american dream which says that the odds are high you'll do better ten years from now than you're doing today and the odds are higher still your kids will do better than you. that american dream, make sure it burns brightly. some have wondered if it's beginning to flicker. and their mandate to us in this election was, get that candle glowing again. but, second, they said do something else at the same time. they said, in no uncertain terms, rein in the out-of-control federal deficit. they told us to take the bull by the horns and confront our mounting debt. and on that point, i'll agree with my colleague from utah. now, it's very hard to accomplish one of these two goals. to accomplish both at once is a herculean task. there are many choices ahead, most of them rather difficult. that's why this is so hard. but one choice isn't tough at all, not by -- tough at all -- i

said tough at oil. anyway, one is not tough at all, not by a mile. it is obvious at this time of fiscal restraint, when we have to make cuts that are so painful and hurt middle-class families, to continue to give big oil companies giant tax breaks makes no sense whatsoever. getting rid of these corporate subsidies to big oil is a no-brainer. decades ago when these breaks were enacted, oil was $17 a barrel. maybe it made a modicum of sense in those days to give companies an incentive to explore and produce. but with the price of crude oil hovering at a hundred dollars a barrel and big oil reaping record profits with every barrel they drill, it defies logic to spend billions of taxpayer dollars on these subsidies. believe me, the free market gives the oil companies enough of an incentive to produce. when oil is a hundred dollars a barrel, they certainly don't

need a financial nudge from washington. now, at the same time, middle-class americans get hit with a double whammy. they're paying $70 or more to fill that gas tank and then, in addition, when they pay their taxes, some of those hard-earned tax dollars are being used to line big oil's pockets with these subsidies. in my home state of new york, the price of gas is up 35% on average compared to this time last year. economists estimate the typical family will pay as much as a thousand dollars more on gas this year than last. a thousand dollars a year. the average family makes about $50,000. it is so hard, they sit around the dinner table after friday night's supper, mom and dad, and they sit down and figure out, how are we going to pay these bills, how are we going to give our kids the life that we want to give them? and they're paying a thousand dollars more for gasoline.

and at the same time we're subsidizing oil companies. families across the country are still struggling to make ends meet as the economy slowly recovers. with billions of dollars worth of tax subsidies and gas prices at record highs, it's no wonder the top five oil companies just announced jaw-dropping profits. these companies are not only among the most profitable businesses in the u.s., they're among the most profitable in the whole world. in the first quarter of this year alone, the big five brought in $35 billion in profit. in the past decade, they took home nearly a trillion -- that's a trillion with a "t." now, there's nothing wrong with these profits in and of themselves. in america, we celebrate succe success. we want the private sector to thrive. but at a time when the government is looking to tighten its expwelt we're grappling -- belt and we're grappling with painful cuts because we have the dual goal of growing the middle class but also reducing the

deficit, it boggles the mind that we continue to subsidize such a lavishly profitable industry. moreover, as my great friend and colleague, senator mccaskill, highlighted this morning in a letter to the federal trade commission, those record profits smell a bit fishy. there is reason to suspect that some of the biggest oil refiners are artificially depressing supply in order to raise price to pad their bottom lines. i am proud to have cosigned senator mccaskill's letter, as did the entire democratic leadership team, and i look forward to the f.t.c.'s respon response. i'm also proud to cosponsor the bill we're considering today, senator menendez' "close big oil tax loopholes act." the legislation will put an end to taxpayer handouts to the five largest integrated oil companies and use the $21 billion in savings to reduce the deficit. this $21 billion is an excellent

down payment on our effort to get the nation's fiscal house in order. the bill repeals a host of byzantine tax provisions that only a lobbyist could love, such as the deduction for -- quote -- "tertiary injectants" and the deduction for "inning tangible extraction -- intangible extraction costs." small- and medium-sized firms are exempt. the legislation, even though some might like to go further, deals with the big five -- exxonmobil, shell, chevron, conocophillips, and b.p. now, i've heard pundits from the hard right parrot big oil's talking point that the giveaways would increase gas prices for the consumers. the facts beg to differ. last week, two major independent studies. one from the c.r.s., the congressional research service, and another from the joint economic committee, found that

ending these absurd subsidies would not impact the price of gas, and i want to compliment senator casey for his leadership on the second study. and what was perhaps an inadvertent moment of candor at last week's finance committee hearing, exxonmobil's c.e.o. rex tillerson said -- quote -- "gasoline prices are a function of crude oil prices which are set in the marketplace by global supply and demand, not by companies such as ours." unquote. when he made that comment, tillerson of exxonmobil conceded that repealing taxpayer-funded subsidies for big oil won't increase prices. prices are set, as he says, by global supply and demand. that's not to say that repealing subsidies will necessarily bring down prices. we're not making that claim. all along, we have been clear. the purpose of this bill is to make a dent in the deficit by repealing tax breaks for the five companies that are the least in need of help from uncle

sam. lowering the cost of gas and ridding our country of dependence on foreign oil requires a long-term, comprehensive approach. and in the months ahead, i expect the democratic caucus will unveil a thorough and forward-thinking plan to do just that. in the meantime, i say to every one of my colleagues on the other side of the aisle, if you're serious about deficit reduction, the menendez bill is your chance to show it now. there is no good reason not to support this sensible legislation sponsored by my friend and colleague from new jersey. just try to wrap your head around it. big oil is recording record profit, gas prices are near an all-time high, and we, the american taxpayer, are subsidizing the oil industry to the tune of $4 billion a year. you need the imagination of alice in wonderland's louis

carroll to come up with a more ridiculous scenario. the bottom line -- at a time of sky-high prices, it's unfathomable to continue to pad the profits of companies with taxpayer-funded subsidies. time to repeal these giveaways is now. i yield the floor. a senator: mr. president? the presiding officer: the senator from missouri. mr. blunt: thank you, mr. president. i rise today in opposition of this bill, the energy tax bill would eliminate so-called tax preferences for some oil companies. actually, i agree with part of the bill, the part that says that several companies don't have -- won't be exempted because we want to continue to encourage them what we want to continue to encourage the industry to do. the rationale that the people that are the larger suppliers don't need to be encouraged also in this doesn't make much sense to me.

my good friend, senator schumer, who is actually the chairman of the rules committee that i serve on, said this bill is not intended to lower gas prices. actually, mr. president, i would suggest we should have a bill on the floor that is intended to lower gas prices. gas prices are costing jobs. jobs cost revenue. we generate a lot more tax revenue if we encourage private sector job creation than will solve a problem here by -- i think he said $4 billion a year. that's how much money we borrowed today. $4 billion is how much money we borrowed today. we're looking at this as opposed to looking at the -- the real problem that we face. this bill is brought up to make it even harder to create american energy jobs, and if there were any jobs that you almost certainly will create, it's producing more american energy. i have looked at the numbers on this. we use about as much electricity in a bad economy as we do a good

economy. we use about as much gasoline in a bad economy as we do a good economy. we ought to be producing every bit of that we could with american jobs, mr. president, but instead we've had the moratorium on drilling in the gulf, we have had the suspension of drilling leases that were issued in 2008, the first -- some of the first acts of this administration were to eliminate those. we now talk about new taxes on energy companies as if that's going to solve a problem. the administration recently announce thad it would encourage the sale of offshore leases, and why is that? i think it's because the administration has finally decided that the economy doesn't benefit from policies that increase energy prices. this is in stark contrast to what we're talking about today. the administration has had a

hard time actually issuing the permits to make leases worthwhile. there's lots of complaining about the fact that there are leases out there that aren't being used. surprise, surprise. the leases to be used have to have a permit, and the permitting process has never been more difficult than it is right now. in fact, some of the reasons are the actions of the e.p.a. shell oil being talked about here today in another way recently canceled its 2011 exploration plans in the beaufort sea in alaska because e.p.a. wouldn't grant them the necessary clean air permits. now, there was nothing different about how you were going to extract this oil in the beaufort sea now than there was when the drilling -- the exploration permits were issued, and billions of dollars were spent to pursue those -- the oil in the beaufort sea and then suddenly the e.p.a. says oh, no, we're not going to give you the

permit it takes to get that oil out of the sea so american customers, american consumers won't benefit from that. both the senate majority as well as the administration haven't been willing to really address this energy crisis in a way that solves the problem. the tax increases won't reduce and will almost certainly increase gasoline prices. if these companies are anywhere nearly as bad as -- as people on this floor say they are, why wouldn't they pass this along? and, in fact, why wouldn't they pass it along if they weren't just any american company. people pay taxes, companies don't pay taxes, and way too many of those taxes are being paid right now at the gas pump as we have tax dollars that could go for something else going not to encourage job creation, but we see just the

opposite happening, mr. president. you know, the president's policy, he said clearly as he was running for president, at least clearly at the "san francisco chronicle," that under his energy policies, energy costs would necessarily skyrocket. senator hatch mentioned earlier secretary chu, who right before he was chosen as secretary -- so it's not anything that would have been a surprise to anybody. in december, 2008, he said what we really need is to get our gasoline prices as high as the prices in europe. now, those prices are now approaching $10 a barrel. i suppose this bill might have the impact of adding costs at the pump. certainly, nobody suggests it has the impact of reducing costs at the pump, but i would think that the president and the secretary of energy and others would begin to realize that where we need to be focused is not on -- on -- on making it less likely that we'll produce

american energy but making it more likely that we'll produce american energy. these incentives are to produce energy here as opposed to somewhere else. one of the incentives is a fraction of the manufacturing incentive that we try to give every manufacturer. these companies have resources around the world, as they should, and what we do is encourage them to go other places to seek those resources, and, by the way, that means the jobs are in other places, not here. we need to find more american energy of all kinds, and in doing that, we don't need to figure out ways to make the current search for american energy more expensive. we need to be focused on -- on gas and oil, natural gas and coal, nuclear and sole arrest, wind energy and biomass. and if i left anything out, it's

not because i intended to. we need to be looking everywhere we can for more american energy. this makes it more difficult. our policy should be to find more, to use less, to look for ways to could i have the energy we have -- to conserve the energy we have, whether it's better insulation in windows or cars that eventually run on something that's some combination of gas and battery powered or no gas at all and electricity. all that's fine, but most of that is not going to make any difference for quite a while. 20 years from now, most cars are still going to be running on gasoline, and 20 years from now, we're still going to need more u.s. oil and more u.s. refined gas, and we need to be less dependent, not more dependent, as we also spend money. the money we spend should be to invest in the future and figure out what comes next and what is the best thing to do for the future. we need to be focused, mr. president, on jobs and on spending, and this bill isn't

focused on the targets we ought to be focused on today, and i yield back. the presiding officer: the senator's time has expired. the senator from washington. mrs. murray: thank you, mr. president. once again i come to the floor to encourage my colleagues to support the close big oil tax loopholes act. all across the country, people are talking about ways to rein in the debt and deficit. here in washington, d.c., we are having a discussion about the best ways to do that. i believe we should cut spending responsible civil while growing the economy and creating jobs for our middle-class workers. there are some difficult issues we have to work through, but the bill we have in front of us should be an easy one. it says that the biggest oil companies in the country should not getting subsidies from american taxpayers. it says that the $2 billion a year we send to these hugely profitable companies should be used instead to pay down the deficit. i don't understand why this

seems to be so controversial. the big oil companies are already making billions of dollars in profits from families across the country who are paying sky-high prices at the pump. in fact, the five biggest oil companies have made nearly $1 trillion in profits in the last decade, and $36 billion profit just in the first three months of this year alone. it's not enough that they're making money hand over fist from families who are now paying sky-high prices. they then come here before congress and make the outlandish claim that they need to be subsidized by taxpayers as well. it doesn't make any sense, and it's got to end. mr. president, budgets are more than just numbers on a page. they are about our priorities and our values as a nation. so i think before we cut spending in areas that will impact our middle-class families and the most vulnerable among us, we should focus right now on cutting out wasteful subsidies to huge companies that don't

need it. that's what this bill does. mr. president, i also want to talk about the high price families are paying for gas back in my home state and across the country. you know, i was recently back at home with senator cantwell and we had the opportunity to meet with some local small business owners who talked about the impact of these skyrocketing prices of oil and gas and the impact on their businesses. they're hurting. these small business owners are already struggling to keep their doors open in these tough economic times, and every time prices go up at the pump, they are pushed one step closer to the edge. that's why i believe as a country we need to move away from our dependence on foreign oil and towards a more secure, affordable clean energy future. it's why i've called for a crackdown on the speculation that is part of what pushes gas prices up and why i was so disappointed that the house republican budget slashed funding for the commodity futures trading commission.

that is the very agency that's charged with protecting us consumers from the excessive speculation in the markets. now, i think that gets to a big difference between our two parties today. democrats are here fight to go rein in the deficit by ending the wasteful subsidies that the biggest oil companies are getting from the american taxpayer. republicans are fighting to cripple the agency that's charged with protecting middle-class families from being ripped off and preyed upon. so these are really two different approaches to tackling the deficit. i'm going to keep fighting to make sure our middle-class families are protected, and i urge our colleagues to support this legislation that will put taxpayers and the middle class ahead of big oil. it will end the wasteful giveaways to oil companies and use that money to pay down the deficit in a responsible way. so i, too, want to thank senator menendez and mccaskill and tester and brown for their great work on this issue, and i hope we can finally put this to rest

and, mr. president, save taxpayers $21 billion over the next ten years. thank you, and i yield the floor. mr. menendez: mr. president, how much time is left? the presiding officer: two minutes and 10 seconds. mr. menendez: thank you. mr. president, the american people understand this bill. they understand that if working families must sacrifice to help lower the deficit, then so should the most wealthy and powerful industry in the country. and if big oil wants to lower gasoline prices, they would put a lot less money in their stock buybacks or their multimillion-dollar c.e.o. salaries and a lot more in producing oil. or they could just use some of their enormous profits to lower prices. but i guess is in that world, greed is good. what the american people understand about this bill, it's clear for twheam it does. but many on the other side of the aisle simply do not and

because this is such a simple, commonsense idea, they've made up arguments just to get through this debate. one of my completion said it would raise the deficit. only in washington -- only in washington could you actually have that comment be made when the joint tax committee has clearly made it known that this would lower the deficit by $21 billion. lower the deficit by $21 billion. not raise t another argument i've heard is that this bill will somehow raise gas prices. that argument is absurd. with the big five oil companies poised to make $144 in profits this year alone, it means that big oil coo would simply stro settle for $142 billion in profits this year to pay their fair share of dealing with the deficit, and they wouldn't stro raise gas prices one cent. and that's what the congressional research service

vice presidentially decided as we will as the joint tax committee. i've also heard the argument that big oil actually pays more taxes than other companies. that's not true for multireasons. exxonmobil's effective tax rate is actually lower than the average american family's rate. they pay far higher taxes abroad in other countries than they do here, so there's no competitive disadvantage, and we have the lowest royalty rates in the world. so, mr. president, we have rarely seen in this body a more stark contrast and a more obvious choice. american families are signature around the kitchen table trying toifying out thousand make ends meet within the contraintses of their own family budgets. we're simply asking big oil making $144 billion do their fair share. that's what this vote is all about. the presiding officer: the senator's time has expired. is there a sufficient second? there appears tofnl to be. the question is on the motion to proceed.

the clerk will call the roll. vote:

vote:

the presiding officer: are there any senators wishing to vote or to change a vote? if not, on this vote the yeas are 52, the nays are 48. under the previous order requiring 60 votes for the adoption of this motion, the motion is withdrawn. mr. reid: mr. president? the presiding officer: the majority leader. mr. reid: several years ago we faced a -- the presiding officer: the majority leader would suspend. the senate will be in order. mr. reid: thank you, mr. president. several years ago we faced a confirmation crisis here in the united states senate. the majority -- at the time the republicans -- were frustrated with the inefficient way the senate was performing our constitutional duty of confirming presidential nominees. many of my colleagues on the other side of the aisle

passionately argued that all judicial nominees deserve an up-or-down vote on the senate floor. in their frustration, they threatened to dramatically change the purpose of the senate and the minority protections for which it was designed. that would have in a manner of speaking blown up the institution. that's why it was known as the nuclear option. in the heat of this battle several courageous senators, democrats and republicans, agreed to a standard -- the presiding officer: if the senator will suspend. the assistant majority leader is right. the senate is not in order. senators will take their conversations off the floor so the majority leader can be heard. the majority leader. mr. reid: in the heat of that battle several courageous senators, democrats and republicans, agreed to a standard that would preserve the traditions of this great body, the united states senate. they -- the presiding officer: -- mr. reid: they ensured the senate would advise the

president's advice and consent. the agreement was significant but very simple. it was this: except in extraordinary circumstances, those nominated to be federal judges would get an up-or-down vote. the minority would not stand in the way of that vote. the agreement was grounded in common sense. so far in most cases both sides have generally upheld that agreement. the nomination before us, however, is not one of those cases. and that is i will file cloture shortly on the tpholgs of good win -- nomination of goodwin liu who is a rhodes scholar, clerk of the supreme court, which is something that just a small percentage of graduates from law school have the opportunity to do. that is be a supreme court clerk. goodwin liu served as associate dean at the california beshly school of law and is now professor there. he has done a significant a. pro

bono work. he even helped launch americorps. on top of that, he's lived the american dream. he's the highly successful son of immigrants. i think president obama was wise to appoint him to the ninth circuit. so do a lot of democrats and so do a lot of republicans. ken starr, infamous as far as democrats go, the former white house special prosecutor, called liu, who served in the clinton administration -- quote -- "a person of great intellect, accomplishment and integrity." former republican congressman bob barr, an extremely conservative former federal prosecutor, also reviewed liu's writings. he came away impressed with, as he said -- quote -- "his commitment to the constitution and to a fair criminal justice system." one of president bush's former white house lawyers said liu's views -- quote -- "fall well within the legal mainstream."

i could go on with more quotes from legislators along the right, left and independents but you get the picture. right, left, center -- they think very highly of this good man. everyone agrees that goodwin liu's nomination is far from the extraordinary circumstance that would warrant a filibuster. the only extraordinary things about liu are his experience, his accomplishments, and his integrity. he should be confirmed. at the very least, he should undoubtedly deserve an up-or-down vote. senate republicans have already forgotten the less often the nuclear option. today they're threatening to block this highly qualified nominee from confirmation. vacancies on the federal bench delay justice for citizens seeking help from our judicial system and it isn't fair to leave in limbo well-qualified nominees. so i'm forced now to file cloture in order to ensure goodwin liu gets the vote he deserves. it's regrettable that it's come to this. as i file cloture, i remind my republican colleagues once again that public servants are not

political pawns. goodwin liu has dedicated his life to justice and fairness. as we consider his nomination, we owe someone of his caliber those same considerations. so, mr. president, i ask consent to proceed to executive session and calendar number 80, the nomination of goodwin liu of california to be a united states circuit judge for the ninth circuit. the presiding officer: is there objection? without objection, the clerk will report. the clerk: nomination, goodwin liu of california to be united states circuit judge. mr. reid reid: i send a cloture motion to the desk with respect to the liu nomination. is it at the desk? thank you. the presiding officer: the clerk will report the motion. the clerk: cloture motion. we, the undersigned senators in accordance with the provisions of rule 22 of the standing rules of the senate, hereby move to bring to a close the debate on the nomination of goodwin liu of california to be united states circuit judge for the ninth circuit. signed by 17 senators as follows. reid of nevada, leahy, schumer,

blumenthal, akaka, franken, durbin, whitehouse, feinstein, merkley, coons, begich, globe cher, boxer, reed of rhode island, stabenow, and brown of ohio. mr. reid: i ask unanimous consent the mandatory quorum under rule 22 be waived. the presiding officer: without objection. mr. reid: mr. president, i also ask unanimous consent the senate resume legislative session and proceed to a period of morning business for debate only with senators permitted to speak for up to ten minutes each. the presiding officer: without objection. a senator: mr. president? the presiding officer: the senator from ohio is recognized. mr. brown: mr. president, thank you. yesterday the white house announced that it will not submit three pending free trade agreements, the f.t.a.'s with south korea, colombia, and panama, until -- until congress reaches a deal on reauthorizing the trade assistance adjustments -- the trade adjustment assistance for workers program, the so-called t.a.a. i applaud president obama for

putting workers first before we do these trade agreements. the trade agreements are very controversial, as they always are. the promises are always that they will create jobs and they rarely do. they usually result in a net decrease in jobs. yet too often congress jettisons the safety net to protect those workers who lose their jobs because of this agreement -- these agreements. that's why i applaud president obama for making this point clear. he will not send these trade agreements to congress until congress has sent to his desk -- not talked about it, not debated it, not passed one committee or one house -- but sent to his desk trade adjustment assistance expansion. as my colleagues know, since we let this program expire in february because of republican objections, senator casey and i went to the floor day after day after day in december, finally -- and then again in february, as republicans continued to object to just to

continue trade adjustment assistance as we had begun in the recovery act two years earlier. so what happened, because of these republican objections, we shut out service workers and we shut out manufacturing workers who had lost their jobs to countries with which we do not have a free trade agreement. so when workers lost their jobs because of outsourcing of jobs to china or india, those workers couldn't get trade adjustment assistance until the recovery act and so they could get in 2009, in 2010. because of republican objections to continuation of that, they can't get it now. also, service workers, people who lost their jobs that were in the service -- service industries experienced the same kind of ending -- the -- the same kind of deadline on thei their -- on their eligibility. since congress made reforms to t.a.a. in 2009, more than 185,000 additional trade-affected workers became

eligible for training under the t.a.a. for workers program. in 2010 alone, more than 227,000 workers participated in t.a.a., receiving training for jobs that employers are looking to fill. these are people that want to work, they lost their jobs because of a trade agreement. they can prove their lost their jobs because of a trade agreement -- they lost their jobs because of a trade agreement, a company shuts down in steubenville, ohio, and goes to new delhi, a company shuts down in lima, ohio, and goes to shanghai. when you can prove that, as you can in many, many cases, those workers should be eligible for assistance from the government to get back -- to get trained to get back to work. the program also, ofof course rg support from businesses who know that a skilled workforce is critical to their economic competitiveness. just 11 days ago, because of these republican objections, and because t.a.a. -- the t.a.a.

language was trunk indicated. imu just 11 days arc the labor department denied the first three petitions filed by groups of workers asking t.a.a. and assistants under pre-2009 rules, including three workers in uniontown, ohio. the reason: they are service workers. in addition, the enhanced health coverage tax credit program also expired in february. hctc helps trade-affected workers purchase private health insurance coverage to replace the employer-sponsored health insurance coverage they lost. helps the retirees who lost their benefits when the company for which they worked goes bankrupt. the hctc prevents tens of thousands of americans from falling into the ranks of the uninsured. right now if we don't act, we're simply giving these workers the cold shoulder. so i applaud the administration for saying yesterday, we will pass no more free trade agreements without a deal on t.a.a. but this will require my republican colleagues to come to

the table and agree on a package. we've seen what unfair trade deals like nafta and pntr with china and cafta do to communities in ohio and around the nation. these are americans who lost their jobs, they lost their pensions, they lost their health care -- maybe all three -- when the company they work for moved operations overseas or went to bankruptcy court or faced to reduction in demand for their products due to unfair foreign competition. these americans need t.a.a. to get back on solid footing. these americans need congress to defend against unfair trade and to strengthen trade enforcement. there are several trade enforcement measures that senator mccaskill and wyden and i and others have been -- that we've introduced and i hope they'll garner bipartisan support in this chamber. senator blunt, senator mccaskill and i testified in front of the subcommittee, the trade subcommittee that senator wyden chaired the other day and talked about some of these ideas and how to address them

bipartisanly. t.a. habe a core pillar of u.s. trade policy. it has long enjoyed bipartisan support because it helps american workers who lose their jobs and their financial security as a result of globalization. i thank senator casey and senator stabenow, senator baucus and senator wyden for their leadership on trade adjustment assistance language, in getting this legislation put forward. mr. president, just the fairness of this -- again, put yourself -- something we don't do enough of here -- put yourself in the shoes of a worker in champagne, illinois, or in boulder, colorado, or in mansfield, ohio, a worker who showed up for work 15 years, helped his company make money, paid a middle-class, decent wage, then all of a sudden their plant shuts down because it's the -- the jobs are outsourced to chiefnlt they didn't do anything wrong. are we going to do nothing to help them? are we going to do nothing to help their communities? it is pretty clear to me, the overwhelming consensus of the american people say give them the opportunity to get training

for another job if we can't save their jobs. give them the health insurance, some assistance and health insurance so they can reach into their pocket with some assistance through a significant tax credit to continue the insurance for their families. it will mean many of them will not lose their homes. far too many people who lose their jobs, they lose their health insurance, lose their homes. we have an opportunity to do something about this. so the president was exactly right. don't bring these three free trade agreements with colombia, with panama, and with south korea to the floor until we've taken care of the workers who lose their jobs first. not at the same time because we know what happens when we try to do that. all of a sudden the assistance for workers gets jet i sonde. but it must be done first to help these workers with their health insurance with their training, with retraining. it will matter for literally hundreds of thowrks perhaps millions, of american feassments mr. president, i yield the floor.

mr. durbin: mr. president? the presiding officer: the assistant majority leader. mr. durbin: mr. president, i ask consent to speak as if in morning business. the presiding officer: without objection. mr. durbin: mr. president, first let me salute my colleague from ohio for bringing up trade adjustment assistance because even if you are a proponent of expanding trade in the united states, you know that the ebb and flow of the economy is going to take away some jobs in this country, as other suppliers arrive. and what the senator from ohio and the senator from oregon, ron wyden, are trying to achieve is to make sure that trade adjustment assistance is there to help these workers make a transition to another job in another area that is expanding in our economy. that is the thoughtful thing to do for their lives and the future our economy. it's also a necessary part of any conversation about the future of trade in the united states. mr. president, i rise to speak about the effect of interchange fee reform on small banks and

credit unions. interchange fees are not well-known. they reflect the amount much money that is paid to a bank each you use that bank' bank's t or credit card. you don't know you're being charged extra when you buy something in a store when you use plastic but that fee is being paid to the bank every time you swipe the card. who establishes that fee? you would assume the bank does. it is not soavment the fee that is charged every time you swipe a card is established by the credit card companies, the big mastercard and visa establish how much that will be. what voice does a merchant or retailer have in how much that fee will be? virtually n no voice. it is a price-fixing mechanism where visa and mastercard and the major credit card companies

establish the interchange or swipe fee to be paid to each bank, credit union or financial institution that issues the credit or debit card. it's a lot of money. each month in america just on debit coas cards now, each monty collect about $1.3 billion in transactions where people use debit cards. a debit card is like your checking account. you're drawing money directly out of your checking account to pay the merchant where you're doing business. it isn't like a credit card where in fact thoaf collect the money from you later on. this is a situation where the money is taken directly out of your bank account. and you would think as with the use of checks in the old economy that this would be a low-cost transaction, and it should be. it used to be banks would process checks written to pay a restaurant or department store, charging pennies on the transaction, not a percentage of

the transafntle well, the federal reserve took a look at what's being charged for debit cards where money comes right out of your account. turns out the average is about 40 cents a transaction. we asked them, well, what is the reasonable amount that should be charged if you're going to take into account exactly how much it costs a bank to process a debit card transaction. they said it was closer to 10 cents or 12 cents. so merchants and retailers across america on every single transaction involving a debit card are paying an inflated amount of swipe fee or interchange fee, and most of those fees go to the largest banks in america. over 60% of all the debit card transactions really focus on three major banks. that would be bank of america, wells fargo and chase. and so there's a lot of money to be made in this business as long as they're using the debit coast guarcardsand getting the swipe . i would put in a new law last year which said the federal reserve should establish what is a reasonable and proportional

amount to be charged for the interchange fee for debit cards. as i told you, the initial investigation suggested it is around cents and the actual charge is 40 cents. now, these banks that are about to lose these major interchange fee receipts are very upset about it because, as of july the 231st, the new rule will go into effect which will bring the fee down to a reasonable and proportional level. so they are fighting this with tooth and nail. today i was at a breakfast here on capitol hill and a group of lobbyists were there. one came up to me and said, durbin, your fight on the interchange fee has more lobbyists working on the issue than any other issue on both sides of the issue. i understand that. that wasn't my goal. my goal is to help the merchants and retailers and consumers. you see when the retail remembers in a competitive atmosphere, if it is one gas station across the street from

another, then saving 30 cents on a transaction can really be part of a decision by a retailer to lower prices to become more price-competitive. in a competitive, free market atmosphere. that's what i'm looking for. i want the consumers to be the ultimate winners. i want retailers and merchants to be treated fairly. for the record, what is the debit card interchange fee charged by visa and mastercard in canada? it is zero. there is no interchange fee in canada. because the government there said we're not going to standed for this. they're really ripping off merchants, retailers and consumers. we won't let you do it. same thing happened in europe. they brought down the interchange fees to dramatically low levels. in the united states, the battle is on, and if you had to pick a group with the lowest level of credibility when it comes in this institution or congress, maybe even the american people, i guess next to politicians, you'd have to say big banks, particularly the big banks that

were bailed out by our federal government when they made a mess of things a few years back. so the big banks that issue the debit cards can't dmom here and lobby for themselves. the credit card companies themselves don't enjoy a very good reputation here either. consumers know what a tough time it is to pay those bills off and the fine print that they have to deal with in contracts. so what these groups have done, the credit card companies and big banks, is enlist small banks and credit unions. to come and appeal us to and say, we're in your city and community. the durbin amendment can hurt us. what they don't say is the law that we pass specifically exempts -- specifically exempts -- all banks and credit unions with valuation of lower than $10 billion. $10 billion. so of the 7,000 or 8,000 credit unions in america, how many have a valuation over $10 billion? three. how many banks out of the 7,000

or 8,000 have a valuation over $10 billion? less than 100. so we're talking about 100 institutions here who will be affected by this law enforcement and the others are exempt. i rise to speak about the effect of this interchange fee reform on these small banks and credit unions. recently the banking industry and some bank regulators have claimed that the small issue or exemption -- $10 billion exemption -- in laflt year's reform law may not wonch the banking industry people said there are market forces that can undermine t they are wrofnlg i respect their right to speculate on what might happen when reform takes place, but in response, i'd point out that they simply have not provided any evidence to back up their claims. in fact, all the hard evidence about the interchange system lead to the opposite conclusion. interchange reform will give small banks and credit unions competitive advantages. against the bigger banks. this isn't just my conclusion. it is a cliewftion a prominent

economist and industry analyst like andrew carr whose frontline program profiled as the creators of the modern card industry, plastic card industry. and former i.m.f. chief economist simon johnson. in a recent survey seen 60% of america's banker subscription pay readers agree that interchange reform will help small baifntle the members who say this terrible rule change that exempts banks with less than $10 billion in assets is going to hurt them, they're otoonly wrong on the facts, they're wrong in public opinion. the key point to remember sheer that the debit interchange system isn't a prorlt functioning market. the interchange system has been designed in a way so normal market forces don't apply. no transparency. no competition. last year a bipartisan majority of my colleagues recognized that reform needed to take place. after years of studies and here,

it became clear the interchange system was not go going to clear itself. it was broken and unfair. andrew martin summarized that the debit interchange system in an expo saivment "competition of course usually forces prices lower but for payment networks like visa and mastercard, competition in the card business is more about winning over banks than actually issuing the cards that consumers were using. visa and mastercard set the fees that merchants must pay the cardholders bank and higher fees mean higher profits for the banks, feign it means that the merchants and retailers have to shift the costs to consumers." martin went on to quote con congeomiment, the former c.e.o. of the star debit network who talked about the struggle to compete with visa. he said, "what we witnessed was

truly a perverse form of competition. they competed on the basis of raising prices. what other industry do you know gets away with that?" james miller, former director of o.m.b., chairman of the federal trade commission under president ronald reagan, elaborated on this in an article entitled "the debit card market is broken and needs fixing nowvment" "under this dysfunctional system, the network's competitive incentives are to raise fees rather than to reduce them. one network raises fees higher than the other to encourage banks to issue cards. soon after the other network raises its fees for the same reason. the result is rapidly escalating fees. this broken system would not survive were it not for the fact that visa and master card represent a combined 90% of the debit market. merchants are powerless to negotiate and can't take their business elsewhere, so they're left with no choice but to pay

these fees. in short, interchange is an abnormal market which has no naturally occurring market force to hold fees in check. visa and master card want as many of their debit cards to be swiped as possible. that's how they make their money. by raising interchange rates merchants must pay to banks, the card companies entice banks to issue more cards. merchants can't refuse visa and master card. they can't negotiate so they're stuck with what they have to pay. last year congress decided we no longer trust visa and master card to fix interchange fees however they want. we agree there should be reasonable constraints placed on the card networks to prevent them from using their market dominance to set unreasonably high fees on behalf of the nation's biggest banks. we passed a law that said when visa and master card fix fee rates on behalf of banks with over $10 billion in assets, the rates, according to the federal reserve, must be reasonable and

proportional to the amount it actually cost the banks to process the transaction. congress didn't have the information about how much it actually cost big banks to process transactions. the banks always kept that secret, even from the general accounting office, so we directed the federal reserve to gather the information on the cost, put out a rule implementing the reasonable proportional standard. that's underway right now. the federal reserve believes that they'll report this rule toward the first part of june, and it will go in effect july 21. when it comes to small issuers, we said they're exempt. this means visa and master card can continue to fix interchange rates on behalf of small banks and credit unions in an unregulated environment like they do today. it's status quo for them. some people might say why would you let the credit unions and small community banks charge a higher rate to swipe the debit card than the big banks? you can make that argument that if you're going to protect consumers at every level, it

should affect every institution. but we specifically exempted community banks and credit unions with valuations below $10 billion, believing that those community banks deserve a break and helping hand. they've not shown much gratitude for that exemption. visa and master card have no incentive to voluntarily lower fee rates for small issuers. remember in the interchange market, visa and master card compete to raise fees to win bank business. they want to have high fees so banks issue more cards. if master card decides to voluntarily lower its small-bank rates, those banks are going to skwrufrpb over and -- jump over and start issuing visa cards. does that make sense for either of these two giants? of course not. why would the small issuer exemption work? this is where creative arguments have come into play from those who say it won't. i want to respond to these arguments i've heard.

first, the claim has been made card networks will not maintain separate tiers of rates for big regulated issuers and smaller issuers. facts don't support it. visa, the dominant network, announced in january it would operate a two-tier system, exactly the opposite of what the lobbyists for community banks and credit unions are saying on capitol hill. visa said they will respect the interchange fees from the smaller issuers. other smaller debit networks made the same announcement. the only company that hasn't is master card, and they are expected to. sure the law doesn't require them to operate two-tier systems. but the card networks will lose money if they don't. if networks want small banks to shaoeurb their debit -- i issuer their debit cards they have to have rates the small banks will be attracted to. the bankers association claimed last week -- quote -- "having two different prices for the same product is not sustainable

in a competitive marketplace." but there's clear evidence to the contrary. look at the current credit card market. according to g.a.o., in 2009 visa had 60 different credit card interchange prices. master card had 243 different fee structure for different cards issued by different banks. a merchant that accepts visa or master credit card might be charged any number of different interchange fees tkpwepbgd on whether it's -- depending on whether it's a consumer or corporate card and the type of rewards program. if you have one of these frequent flier cards, there might be a higher interchange fee that's going to be charged to the retailer where they accept your card. from the merchant's standpoint, they treat it as exactly the same product. it's a credit card. but there are many different interchange prices that the merchant might get charged. visa and master card have

sustained this multitiered pricing structure for years. the american bankers association has to know that. why would they state exactly the opposite? well, because their biggest banks are the ones that are going to lose out if the consumers prosper under this new change. how have they been able to do it? these card companies. remember the interchange system is not a normal competitive market. in this case, card networks impose rules on every merchant that require merchants to accept every card with a network logo on it. it means if you're running a store in springfield, illinois, or denver, colorado, and somebody shows up with a visa card, you have signed a contract that says i honor every card with visa emblazoned on it put on the counter. even though i pay a higher interchange fee as a retailer, if it's a big card with frequent flier miles and all the rest of it, you've got to take it. that's the law. that's the contract law that binds these merchants. third, the american bankers

association has claimed that if big bank debit fees are reduced merchants will discriminate and find some way to get customers to use big bank debit cards instead of maul issuer -- small issuer cards. if this were true we would see evidence of it because of multitier pricing in credit card interchange. for example, for a super market a visa card with no rewards program carries a fief 1.15%, more than 1% of what you purchase. that's the interchange fee if it's a simple visa credit card, no rewards. but a visa signature preferred rewards credit card has an interchange fee of almost twice that. 2.1%. by the a.b.a.'s logic supermarkets would be discriminating against rewards cards and steering customers to nonrewards cards. no evidence of that discrimination anywhere. i challenge the american bankers

association to put up or shut up. if you've got some evidence to the contrary, let's see it. if you don't, retract the specious claim. why don't merchants discriminate? the merchant community sent me a letter a few weeks ago explaining in detail how they lack the contractual authority to do it, the practicability and economic incentive to discriminate. i want to add a commonsense point. most americans only have one debit card. if a merchant tells a customer not to use his debit card because it was issued by a small bank the customer would likely do one of two things. not make the purchase at all or pay with a credit card. credit cards carry much higher interchange fees than debit cards. how would discriminating against debit cards be in a merchant's interest? when i talk to the merchants, i've got wendy cronister who runs a whole slew of gas stationness central illinois, took the business over from her dad, a great young woman, executive, and she said senator, they put the plastic on the

counter. we take it. if it clears, we've got the transaction, move on to the next customer. we are not going to debate how many other credit cards are you carrying and where's the one with the lower interchange fee? we don't have time for it and are not going to put that hassle on our customers. some make the argument that the nonexclusivity issue will cause exchange rates to go down. this exclusivity provision is often misunderstood. until recent years nearly all debit cards were set up by banks but in recent years the dominant networks particularly visa formed exclusive deals with big banks so the transactions on the debit cards could only be run by one network. what they're trying to do, credit card companies are trying to do is monopolize the transactions as well as the cards. these exclusivity agreements are threatening to drive smaller debit networks out of business. this creates real barriers to

entry for new networks. all the nonexclusivity provision in the new law says is that banks have to pick at least two unaffiliated card networks to enable on each debit card, and merchants get to choose which network they want. you know what? i want to say to my friends at the "wall street journal" who write editorials saying what a bad idea interchange reform is. what we're talking about here is something called competition. for the biggest business newspaper in the united states, you'd think they would support something like this. nonexclusivity is not new. last month the pulse network released its annual survey of debit card issuers. pulse said when it comes to this nonexclusivity requirement many issuers complying and we vent seen -- we haven't seen interchange rates decline as a result. the nonexclusivity provision gives the fed broad discretion to lay out guidelines to make it work effectively. the fed also gets to choose the effective date. in short, this provision is not

the bogeyman that some have made it out to be. it is simply a safeguard to ensure visa doesn't become the only debit network left in the market. what i've learned after years of working on this complicated issue is the following: banks and credit unions will consistently oppose any type of reform. the american bankers association is legendary. it represents the banking industry and credit union national association which represents the credit unions both have statements on their web site making it clear that there is no regulation of the interchange system they'll support. senator kit bond of missouri, now retired, and i tried to negotiate with the banks and credit unions in 2009, and were thinking about doing an amendment to allow for greater interchange transparency and debit discounts. banks and credit unions blasted a letter of opposition out before we even drafted the amendment. and now the opponents of my amendment say what we need is 30

months to study this. study it for what? i know where it's going to end up. we've been through this before. i've seen this movie. the american banking association, bankers association and the national credit union association now marching in lock step on issues are going to oppose any reform. the entire financial industry is making a killing under the current interchange system to the tune of $1.3 billion a month. do the math and figure out why this has every lobbyist in town working to defeat the durbin amendment. 30 times 1.3, that's pretty close to $40 billion that's at stake here if the amendment to stop this durbin change in the interchange fee system goes through. the change needs to go through. there's widespread consensus that we need to reform interchange system to rein in visa, master cards and the biggest banks on wall street. i don't think anyone disagrees with that. in fact, i've seen polling across this country in every

state from virtually every political group, left, right, and center where they overwhelmingly support interchange fee reform. the credit unions and community banks are selling a story which the public isn't buying. in carrying out this reform, i bent over backwards to try to address small issuer concerns. i don't want small banks and credit unions forced out of the debit card market. that's why we exempted them. i want consumers to be able to bank at these institutions to use debit cards. i try to protect small banks and credit unions even though they made it clear they don't support any regulation of the system and even though they fought me every step of the way. by exempting small issuers from fee regulation, we've left intact an interchange system that has worked quite well for small issuers and almost certain to continue to work well. let's be clear, there's only one way we can provide these small issuers with an absolute 100% guarantee that visa and master card will give them interchange rates they like. there is only one way to do it.

that would be to regulate the rates that visa and master card fix for small issuers and make sure they're appropriate. i'm happy to explore that. i can already tell you the small issuers are going to push back on that immediately. they want their cake and they want to eat it too. they want no regulation, they want to be able to charge interchange fees that reach the heavens and they don't care what happens to merchants, retailers or consumers. i think we took care of small issuers in last year's law. if they have suggestions on thousand give them more assurance than visa or master card won't set rates at unsustainable levels, i'm listening. but make no mistake, i will not support delay or repeal of the overall interchange rule making because they will at the big banks and card networks off the hook. we are close to finally reining in the abusive interchange system and providing help to consumers and merchants. we can't let big banks and card merchants avoid big banks again. they get away with too much.

i strongly believe we need interchange reform. we need to bring fairness, competition and transparency to a broken debit system. i'll work hard to make sure this reform happens and happens soon. i would think the fact that the opponents to my amendment are trying to stop it before the fed even issues a rule is an indication they don't even want to see what the rule looks like. why? $1.3 billion a month, that's why. change is going to cost the big banks big money. that's why the credit card companies, the banks on wall street are fighting it. i've tried to approach this issue in a reasonable way, focusing on the facts. i'm always happy to engage with others who share this approach even if they disagree with me. mr. president, i yield the floor.

mr. durbin: mr. president, i ask unanimous consent the senate now proceed to consideration of senate resolution 186, submitted earlier today. the presiding officer: the clerk will report. the clerk: senate resolution 186, honoring the00th anniversary of the united states army field artillery school at fort sill, oklahoma. the presiding officer: without objection, the senate proceeds to the measure. mr. durbin: i ask unanimous consent the resolution be agreed to, the preamble be agreed to and the motion to reconsider be laid upon the table. the presiding officer: without objection. mr. durbin: mr. president, i ask unanimous consent the senate proceed to the immediate consideration of senate resolution 187, introduced earlier today. the presiding officer: the clerk will report. the clerk: senate resolution 1 187, supporting national minority health awareness and so forth. the presiding officer: without objection, the senate will proceed to the measurement mr. durbin: mr. president, i further ask the resolution be agreed to, the preamble be agreed to, the motion to reconsider be laid on the table with no intervening action or debate and my statements relating to the measure be printed in the record at the

appropriate place. the presiding officer: without objection. mr. durbin: mr. president, i ask unanimous consent that the appointment at the desk appear separately in the record as if made by the chair. the presiding officer: without objection. mr. durbin: mr. president, i ask unanimous consent that when the senate completes its business today, it adjourn until 10:00 a.m. on wednesday, may 18. following the prayer and pledge, the journal of proceedings be approved to date, the morning hour be deemed expired, the time for the two leaders be reserved for their use later in the day, that following any leader remarks, the senate proceed to a period of morning business until 10:30 a.m. for debate only with senators permitted to speak therein for up to ten minutes each, with the time equally divided and controlled between the two leaders or their designees. finally, that the senate resume consideration of the motion to proceed to s. 1953, the offshore production safety act under the previous order. the presiding officer: without objection. mr. durbin: mr. president, there will be a roll call vote tomorrow around 2:30 p.m. on the motion to proceed to s. 953. additionally, this evening, the majority leader filed cloture on the nomination of goodwin liu to be a u.s. circuit judge for the ninth circuit. as a result, senators should expect a cloture vote on the nomination sometime thursday. and, mr. president, if there's

no further business to come before the senate, i ask that it adjourn under the previous order. the presiding officer: without objection, the senate stands adjourned until 10:00 a.m. adjourned until 10:00 a.m.

>> today, in the senate, members debated a bill to end subsidyings and tax breaks to oil and tax companies. we heard from several senators on the issue. next, senator menendez and boxer of california. this is 40 minutes. >> mr. president, i rise to follow on the majority leader's bringing this legislation to the floor which i'm privileged to sponsor with a whole host of my

colleagues, and really to speak out for taxpayers and -- sorry -- really to speak out for taxpayers and against continuing to provide subsidies to multibillion dollar big oil companies, and we're talking about the big five. we're not talking about any other entity, just the big five. a vote on my bill presents a positive vote on my bill and presents a simple choice for everyone in this chamber. are you on the side of working class families, or are you on the side of bill oil? there are lots of ways to cut the deficit. many of our colleagues, particularly the other body, they want to end medicare and cut student loan programs. what i and my co-sponsors want to do is end wasteful oil tax breaks or a wealthy industry that does not need them. now, mr. president, clearly, we

need to tighten our belts to address the deficit, all of us, even the oil companies. we all know that oil companies are among the largest, most profitable companies in the world, but sometimes it's hard to understand the true scale of their wealth, so this chart is an attempt, just a simple attempt, to give some perspective. you know, the median income in the united states is about $55,000. exxon mobile, one of the big five, is projetted to earn -- projected to earn in profits, in profits, $42.6 billion this year, $42.6 billion. now, it's impossible to show this disperty on a chart, but if this chart were to scale, and each bundle of money equaled

$50,000, then we would need more than 850,000 stacks of bills to equal exxon mobile's profits over the next year, 850,000 stacks of bills on this poster would be about 170,000 feet high or 32.2 miles straight up through the chamber of this chamber and beyond the stratus stratusfere. 32 miles of poster was a bit much, so i didn't do that. mr. president, my bill would close several loopholes for big oil, loopholes that given the current budget climate would let big oil get away without making any sacrifices, any sacrifices

at the very time we ask middle class families to and the disabled and elderly to reduce the deficit. there's no common sense explanation for balancing the budget on the back of working families and letting multibillion oil companies keep billions in taxpayer dollars. now, i know that at the same time that the median income is $50,000 for americans. here's what it is if you're ceo of one of the big oil companies. in last year alone, the ceo of exxon mobile got paid $29 million, but conoco was paid $18 million. chevron, about $16 million. most americans will not see that in their lifetime of work. so to have these executives come

last week before the finance committee and say, as some of them, one of them, their companies put out that the suggestion about taking away some, not all, some of their tax subsidies was un-american is pretty outrageous. let me explain two provisions of my proposal. the first provision has to do with foreign tax credits. u.s. taxpayers are taxed on their income worldwide, but they are entitled to a dollar for dollar tax credit for any income taxes paid to a foreign government. they get that taken off here. makes sense. you don't want to tax the same activity twice, but u.s. oil and gas companies have pretty smart lawyers and clever accountants. they figured out if you can convince a foreign government like indonesia to charge you

taxes instead of a royalty, in essence a fee that you pay for the purposes of jarring that oil of the country, that they can get a big break on their u.s. taxes, but what this amounts to is that the united states taxpayer is subsidizing foreign oil production. this bill would close that loophole and return $6.5 billion to the treasury. another one -- in 2004, congress created the domestic manufacturing tax deduction. it was designed to help u.s. manufacturers who export a product to a foreign market so cars, you know, iphones, ipads, you know, all of that. well, few would really see the extraction of oil from the ground as manufacturing, but, again, big oil lobbyists earn

their money. they saw an opportunity, some made phone calls, and low and behold, according to the tax code, oil companies are in the manufacturing business. this legislation closes that loophole and saves taxpayers almost $13 billion. that would be $13 billion more towards deficit reduction. now, the american people understand this bill. they understand that big oil makes enormous profits, and there's nothing wrong with making profits, by the way, but they don't need to have our tax dollars in order for them to make those profits. they understand that big oil does not need taxpayer subsidies, and they understand if big oil wants to lower gasoline prices, they can put a lot less money in stopped buy backs and a lot more in lowering prices or producing more oil, but in order to combat this straightforward common sense

bill that even the cato institute supports, bill oil supporters have strange rhetoric. the strangest by far as i alluded to before is suggesting those who support cutting these wasteful subsidies are un-american. seems to be when a company stoops so low as to question the pay patriotism of those suggesting you know what? maybe you can do without $21 billion in taxpayer subsidies when you make $125 billion in profits, not proceeds, profits, to $140-some billion and to question the patriotism of subsidies is to suggest there's not good charge on your side. i think the 74% of americans who support ending oil subsidies know they are more american than

that point of view. another argument i keep hearing is that oil companies are entitled to these breaks. this argument seems to suggest that the wealthy and powerful deserve what they get and that working class families should know their place and no better than to ask oil companies to do their fair share as well. you know, warren buffet, one the richest men in the america said, "there's class warfare, all right, but it's my class, the rich class making the war, and we're winning." this bill says that even the most rich and powerful among us must do their fair share to help us reduce the deficit. there's high priced lobbyists who cannot stop us from doing what is fair and what is right. now, some of the industry have also claimed that cutting $2 billion in annual oil subsidies to the big five oil companies will somehow make oil and gasoline more expensive.

that argument is absolutely false. this bill would save taxpayers $21 billion over ten years, roughly a little over $2 billion per year. compare $2 billion in taxpayer subsidies to the projected anywhere between 125 and 144 billion in profits the big five oil companies are expected to make this year, so the big five oil companies could just live, just live, with $142 billion in profits in 2011. they could pay their fair share in taxes, help lower the deficit, and not raise the price of gasoline. let's put it in a different way. a finance committee went to the corporate filings of the big five oil companies and found that their cost of extracting oil is about $11 per barrel.

when all this trading is near $100 per barrel, it's simply absurd to suggest the cost oil companies are facing is what determines the price of oil without cutting $2 billion per year in the subsidies will somehow force oil companies to raise prices. in addition, the nonpartisan congressional research service just came out with a definitive report echoing the sentiments of countless economists and other observers say k my legislation would not increase gas prices at all. mr. president, it's time for the big five to do the right thing for a change and pay their fair share. this should not be hard since in 2005, the ceos of some of the big five oil companies testified that they agreed with former president bush that they do not need subsidies to drill for oil when it's selling at $55 per

barrel. well, it's selling at nearly $100 per barrel now, so it's strange to think they need government handouts to drill. we cannot expect the average working family to shoulder the burden of lowering the deficit alone, and i hope some of the favorable comments i hear from my republican colleagues in recent weeks men they are read to join in the effort and lower the deficit because all the savings goes to the deficit deduction in an equitable and effective manner. what fair is fair, but nothing about continuing subsidies is fair. now, those on the other side would end medicare as we know it in the name of deficit reduction while continuing to pump billions of dollars into corporate welfare into $100 billion profit industry. that's the height of hypocrisy. it's not fair to working families. it's not a wise use of limited

federal resources, and if this body does the right thing today, it's not going to continue. there's nothing fair about the suggestion of ending medicare in favor of big oil subsidies. big oil has to do the right thing by america. they can be part and should be part of the solution to our deficit challenge, and that is the opportunity we have today. with that, mr. president, i yield the floor. >> mr. president? >> senator from alaska. >> thank you, mr. president. mr. president, i ask consent i be recognized for 15 minutes and the following list of republican speakers be recognized up to 10 minutes each not necessarily in this order, but the senators to be recognized would be mccain, barasso, hatch, and -- >> without objection. >> thank you, mr. president, i have also come to the floor

today to speak about the proposal to raise taxes on the five largest domestic energy producers, and i think it's important that we remember that we are speaking about five energy producers, five oil companies. we're not talking about a tax proposal that is broad and wide and encompassing. we are talking about a proposal to raise taxes on the five largest domestic energy producers, and i have to admit i had hesitation about even engaging in this floor debate at all because i think we recognize that the words in the statements we're delivering here are just that. they are just talk, just words. this proposal is designed to fail, but in failing, it is designed to score some political points, and it seems like that's where we are today, but as a senator who represents a state like alaska, a oil and gas producing state, a state that

would be hurt by this proposal, i am obligated to outline why i feel this is so deeply flawed. i want to start by really stating the obvious here. this legislation will not reduce energy prices, but if anything, it will increase our energy prices. it will not substantially reduce our deficit or our debt, but if anything, it will add to those burdens by shutting off production and forcing the government to forego production revenues. i think it's important that we put this in context because people around the country looking at the price at the pump go up day after day, they say, what are you doing in congress to lower the prices? what are you doing to deal with the higher prices of gasoline in this country? i think it's important that we recognize that this legislation that we have in front of us does nothing to reduce our energy

prices, and it's not just me that says that. chairman of the finance committee indicated that we've heard several members or those republican side of the aisle, democrat side of the aisle saying this is not going to reduce prices. what is it we are seeking to do with this other than send a message? this proposal i think it's important to recognize hurts poor and working families across our country. we all know what the price of gas is in our respected states. i will remind my colleagues that as much as alaska benefits from high prices of oil as we are producer, it is a fact that it -- it chose us as in our local -- in our local communities in our economies because we are this state with the highest gas prices across the country right now. there was a story, a news story,

just last week back home in the northwest region up in the state and they are paying $7.50, $8.95 in amer. i was in fort yukon a couple weeks ago. they are at a $5-$7 gas figure, but the spring barge which comes in in about four to five weeks will deliver fuel at prices set a few weeks ago, and people have been alerted on the day the barge delivers fuel the price goes up at the point one additional dollar. we're not talking cents, but a dollar to the people in fort yukon. we know very well what high prices mean to us, and our constituents are asking us to do something about it. what can you do to lower the prices and deliver a policy that starts to work now and then yields progress over time?

our constituents are not asking us to make this problem worse, and yet, that is precisely what these proposed tax increases will do. now, i heard my colleague here say that no, this is not designed to increase the prices that are out there. well, it might not be designed to do that, but that's what we can expect if, in fact, these tax increases do go into play. now, it's been a few years since i got my degree in economics, but even though it was more than a few years ago, i do remember some of the very early entry level classes that i took, and i remember learning that raising taxes on something is going to tend to make it more expensive, and i remember learning that when you tax something, you tend to wind up with less of it. that's just basic economics, and i think that there's at least some understanding of these

concepts around here because i don't see anyone that is proposing to raise taxes on solar panels or wind turbines to bring down their cost. the reality, mr. president, is that this proposal, and i believe the point is conceded even by supporters, this proposal will not cause gasoline prices to drop. instead, it could very well cause them to rise. i understand the memo from the congressional research service suggesting that no significant impact on prices will be seen in the short run, but that is the key phrase here, "in the short run." what we need to be doing is looking longer term than next week or next month. whenever corporations faced increased costs, they have a responsibility to their investors to recover those costs wherever possible, and usually what happens is they pass them on to the consumer, and to the extent the cost of this proposal

cannot be passed on, these companies will simply have less to invest in new projects. now, that's kind of talking about what happened or what doesn't happen with the price of gas, but this proposal is also not about reducing the debt either, and it's important to put that in context here too. at best, a drop in the bucket. according to the gao, the fiscal year 2012-2021 results in nearly $9.5 trillion in new debt. this proposal, assuming there's no negative economic impact raises $21 billion or about .2% of that debt. we still need something like 450 times more revenue to break even, never mind the $14 trillion debt we already

incurred. we hit the debt ceiling yesterday, so it really causes you to wonder, is this the best we can do when talking about balancing the federal budget. now, i understand this proposal is not all that it will take, and no one is proposing that did do so, but it is important that we be honest with the american people when we talk about what this would mean in terms of reduction to the deficit, and if we're being honest with each other, we'll see this proposal for what it is. essentially, a yes vote tonight to raise taxes on oil and gas companies is simply a vote to try and take a pound of flesh from these five major companies that, yes, in fact, are making money. yes, in fact, are making a profit. a no vote on this proposal tonight is a vote to try, try to keep our prices under control, and it's a vote to help preserve america's competitiveness within

the global economy. now, i also want to take just a moment to set the record straight on subsidies. there are no payments from the federal government to the major energy producers as some have implied. past congresses have decided that those companies, and most other companies in america i might add, deserve certain tax reductions, and this is a critical distwinges here because we haven't decided that the federal government should take -- should give more to the companies. what we decided is the federal government should take less from them. now, if that's the same as a subsidy, then new owners are direct recipients. we deduct payments. that means every company in the country, whether it's a hollywood studio, the "new york times," however it is, every

company is somehow or other subsidized. now, if we are talking about leveling the playing field, especially in the context of broader reforms that makes our tax code simpler and more fair, i welcome that discussion, and i think many in this chamber do. it would be a much different conversation if we were considering a reduction in the corporate tax rate, but, instead, we are here debating whether or not to give different tax treatment to essentially punish a handful of companies in just one sector of our economy, and really there's no policy justification for it other than that they can afford it. they are making money. they can afford it, so i would ask my colleagues is this the kind of business climate that we want for the united states? i really have to wonder then if

the answer to that is yes, who the next target will be? if making large profits signals to congress that you should be taxed at a higher rate, in reality, domestic energy producers are already amongst the most heavily taxed companies here in this country while the effective tax rates for all corporations average 26.5% last year, the oil and gas industry tax rate was at a much higher 41% instead of being subsidized by the federal government, the industry is actually a very large taxpayer. the federal government taxes gasoline at a rate of 18.4 cents a gallon and receives billions of dollars each year in nontax revenues from the industry. producers must pay the government for the rights of leases, pay annual rent to hang on to the leases, they pay royalties on any production that ultimately results from them, so

in terms of what is paid out according to one estimate, the oil and gas industry's total payments to the government amounted to $86 million per day, per day in 2010. now, i would also remind my colleagues that the president has established a goal of cutting oil imports by 3 million barrels a day by 2025. if we intend to achieve that goal, a good goal, raising taxes on domestic oil production just defies the logic here. to reduce imports, we have to increase our domestic production, and that won't happen if we impose a hostile tax environment for the companies that operate here, companies that are already challenged to produce the oil and gas resources that we know we have, but we haven't been allowed to explore. before i conclude, mr. president, i want to mention an