Domenici Statement on Democrats "No Energy Bill"

Majority Seeks Windfall Profits Tax & SPR Section Already Enacted Into Law to Floor

June 6, 2008
03:10 PM
WASHINGTON – After fierce debate over climate change legislation that over a dozen independent analysis show will significantly increase gas prices, Senate Democrats will now force a vote on their legislation intended to address gas prices (S.3044).  U.S. Senator Pete Domenici, ranking member of the Senate Energy and Natural Resources Committee, had the following reaction:
“It seems as if Senate Democrats are determined to do everything in their power to increase gas prices.  First, they proposed one of the largest, costliest and most complicated pieces of legislation in American history which the Energy Information Administration predicts could increase the price of gasoline by over one dollar a gallon.  Then, they took procedural steps to ensure that we can’t even offer amendments to the bill, which is absolutely unprecedented for a bill of this magnitude and speaks volumes about the true intent of the Majority on this legislation.
“Now, the Majority will try to force the Senate to consider their legislation which is purported to address the high price of gasoline, which in fact will likely raise prices. Among other provisions, this legislation imposes a costly 25 percent windfall profits tax on American oil companies, and seeks to raise exploration and development costs for oil companies doing business overseas—a terrible idea at a time when gasoline is $4.00 a gallon.  This bill even contains the same suspension of the Strategic Petroleum Reserve that is already the law of the land.  The American people deserve more careful attention to our energy policy than including already enacted-laws into new legislation.
“The last time a windfall profits tax was imposed—in 1980—it reduced domestic oil production by up to 1.27 billion barrels during a period in which dependence on foreign oil grew from 3 to 13 percent.  It is no wonder why the person in the Carter Administration who implemented the tax has called it a “terrible idea today,” and why the Congressional Research Service predicted that a windfall profits tax could have “several adverse economic effects” and could be expected to “reduce domestic oil production and increase the level of oil imports.”
“It should also be noted that the Democrats’ bill does not offer a single measure that will increase production, in contrast to the legislation I offered which would provide up to 24 billion barrels of oil—enough to keep America running for five years with no foreign imports.  The American Energy Production Act provides real solutions to the pain they are feeling at the pump.  The Boxer and Reid bills fail in this regard.