Bush Administration Sued Over Fuel Economy Standards

May 4, 2006

From The Washington Post:

Nine states have sued the administration of President George W. Bush for lenient automotive fuel economy standards that they say worsen an energy crunch and contribute to air pollution and climate change.

The lawsuit says that the U.S. National Highway Traffic Safety Administration has failed to meet federal laws requiring government to determine the impact of regulation on fuel conservation and the environment.

"At a time when consumers are struggling to pay surging gas prices and the challenge of global climate change has become even more clear, it is unconscionable that the Bush Administration is not requiring greater mileage efficiency for light trucks," said New York Attorney General Eliot Spitzer in a press release.

In March, the Bush administration approved a 1.9 mile-per-gallon increase in the standards for sport utility vehicles, minivans and pickups — all in the light truck class that includes big gas guzzlers — to 24.1 mpg between 2008 and 2011. It also rewrote the rules for calculating how far light trucks must go on a gallon of gasoline.

But the lawsuit, joined by the attorneys general of California, Connecticut, Maine, Massachusetts, New Mexico, Oregon, Rhode Island, and Vermont, says the move included language that could "create incentives to build larger, less fuel-efficient models" and attempts to pre-empt a California law requiring a reduction of greenhouse gas tailpipe emissions.

Bush said last week he is also seeking authority from Congress to allow him to boost fuel-efficiency standards for passenger cars. Bush proposed no specific figure for increasing mileage standards for cars for the first time in 16 years, but officials said they wanted broad changes.

Environmentalists have long urged a substantial increase in fuel-economy standards, which they view as one of the most effective means of reducing the U.S. appetite for foreign oil.

The attorney general of the District of Columbia and the corporate counsel for New York City have also joined.

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Saudi Minister Scoffs At US Energy Independence

May 4, 2006

From The San Francisco Chronicle:

Saudi Arabia's oil minister scorned the popular notion that America can achieve energy independence as a myth, saying Tuesday the idea denies the existence of interdependent global markets and the need for countries to work together for oil-price stability.

Top Democrats in Congress, who argue that America can become independent of foreign energy sources within 10 years, reacted heatedly to Saudi minister Ali Naimi's statement, insisting their goal is realistic.

The exchange came as Congress was locked in a testy debate about how to react to record high gasoline prices, an issue that both parties recognize has jumped to the top of voters' election-year agendas.

Politicians from President Bush on down are scrambling to respond to the public's anger. Republican leaders said Tuesday the House will vote today on a bill intended to strengthen Federal Trade Commission tools to investigate allegations of oil price gouging. They also indicated votes are scheduled today or Thursday on legislation that the GOP says would speed construction of new refinery capacity by granting quicker regulatory approvals.

Showing the rush by Republican congressional leaders to let voters know they've heard the call for action, both hurried bills will be considered under rules requiring two-thirds majority approval for passage instead of the usual simple majority vote. That means passage will depend on Democratic votes, and it wasn't clear Tuesday how the minority party will react.

But the gas price issue also has split the Republican leadership.

House Majority Leader John Boehner, R-Ohio, denounced the proposal by Senate Republican leaders to give every taxpayer $100 to make up for higher gas prices.

"Trying to satisfy voters with a $100 rebate is insulting,'' Boehner told reporters. He said constituents thought the proposal "was stupid.''

Bush's top economic adviser, Edward Lazear, also cast doubt on the rebate idea, saying the administration is studying it, but "is that the best way to be using our tax revenues? Is it the most efficient way to allocate our resources?"

The Saudi oil minister Naimi, in Washington for a Saudi-U.S. energy conference, rejected the idea that energy self-sufficiency is a worthwhile goal for America.

"While self-reliance is appealing, the efficacy of such an approach for achieving long-term energy security is an illusion built on the myth that security can be achieved through protectionist measures aimed at blocking certain types of imports or goods and investments from certain regions of the world,'' Naimi said.

He stressed that the world oil market, stretched thin by surging demand and years of low investment when prices were low, can provide "sustainable energy stability'' when consumers don't feel gouged and producers get an adequate return on their investment.

Naimi said that even though he questions the viability of U.S. energy independence, Saudi Arabia thinks America should increase conservation efforts and research and development of such alterative fuels as ethanol.

"I believe it's beneficial to begin research on alternative fuels that can go hand in hand with hydrocarbons. We are going to need an alternative'' as oil resources are depleted in coming decades, added the oil minister of Saudi Arabia, which is the world's No. 1 oil exporter and the fourth-largest foreign supplier to the United States.

On Capitol Hill, Democratic leaders gathered to denounce Bush and the Republican Congress for what they say has been an overly close relationship with big oil that has resulted in the prices of more than $3 a gallon.

They attacked Naimi's position. "How dare they come to our country and say that our declaration of independence is a myth,'' said House Democratic leader Nancy Pelosi of San Francisco.

Her Senate counterpart, Sen. Harry Reid of Nevada, said the experience of Brazil, where a three-decade campaign based on increased production of sugar cane-based ethanol has resulted in energy independence, shows the United States can do with far less foreign oil. "If they can achieve energy independence, certainly we can,'' Reid said.

The Democrats also linked the war in Iraq to high energy prices, blaming it for bringing uncertainty to the world oil market and cutting Iraq's oil exports because of insurgent attacks on pipelines, refineries and other facilities.

The Bush administration has already outlined the goal for domestic ethanol production of 5 million barrels a day by 2025. By comparison, U.S. oil consumption today is 20 million barrels daily, a figure that is expected to increase to 26 million by 2025.

"If we are successful, and that remains to be seen, in developing ethanol, we will still be using imported and domestic oil and natural gas in very significant quantities,'' Energy Secretary Samuel Bodman said in an appearance with Naimi.

John Hamre, president of the Center for Strategic and International Studies, questioned why the public and politicians have focused on energy independence.

"I find it ironic. We don't say we should be financially independent from the rest of the world … or food independent. We don't say we want to be manufacturing independent,'' Hamre said. "We're misleading the American public. We should be talking about energy interdependence.''

The debate, and the House's plan to vote on two measures, was just a small part of a multifaceted spurt of action about gas prices.

The House Energy and Commerce Committee has scheduled a hearing today on legislation that would grant the executive branch the authority to raise minimum fuel efficiency standards on cars without congressional approval.

The president has that power over trucks and sport utility vehicles, and he recently used it to raise the mileage standards. His administration was sued Tuesday by 10 states, including California, which claim the increase was insufficient.

Senate Majority Leader Bill Frist of Tennessee, who had pushed the $100 tax rebate idea, may also try to attach energy legislation to the huge emergency spending bill now under debate.

One key provision he and other Republicans have pushed for years is their plan for drilling in a slice of the Arctic National Wildlife Refuge. That plan is vigorously opposed by environmentalists.

In the Capitol, House Speaker Dennis Hastert, R-Ill., met with ExxonMobil chief executive officer Rex Tillerson as part of a GOP effort to be seen pressing big oil companies to do more to increase gas supplies. 


The GOP, Beholden To Big Oil, Wonders Where It Went Wrong

May 1, 2006

From The New York Times:

The Senate Republican plan to mail $100 checks to voters to ease the burden of high gasoline prices is eliciting more scorn than gratitude from the very people it was intended to help.

Aides for several Republican senators reported a surge of calls and e-mail messages from constituents ridiculing the rebate as a paltry and transparent effort to pander to voters before the midterm elections in November.

"The conservatives think it is socialist bunk, and the liberals think it is conservative trickery," said Don Stewart, a spokesman for Senator John Cornyn, Republican of Texas, pointing out that the criticism was coming from across the ideological spectrum.

Angry constituents have asked, "Do you think we are prostitutes? Do you think you can buy us?" said another Republican senator's aide, who was granted anonymity to openly discuss the feedback because the senator had supported the plan.

Conservative talk radio hosts have been particularly vocal. "What kind of insult is this?" Rush Limbaugh asked on his radio program on Friday. "Instead of buying us off and treating us like we're a bunch of whores, just solve the problem." In commentary on Fox News Sunday, Brit Hume called the idea "silly."

The reaction comes as the rising price of gasoline has put the public in a volatile mood and as polls show that cynicism about Congress is at its highest level since 1994.

Still, Eric Ueland, chief of staff to Senator Bill Frist of Tennessee, the Republican leader, whose office played a main role in pulling the proposal together, said the rebate was an important short-term step in a broader array of measures that began with last year's energy bill. Constituents "believe government ought to step up to the plate rather than loll around in the dugout," Mr. Ueland wrote in an e-mail message on Sunday.

After members of Congress returned from the spring recess, when they got an earful about gas prices above $3 a gallon, they raced to propose solutions that might take effect before the elections. Democrats were pushing for a 60-day suspension of the federal gas tax of 18.4 cents a gallon, and the Senate Republican leadership settled on the rebate.

Those leaders and Finance Committee aides said many Republicans opposed the Democratic plan because they feared that oil companies, which pay the gas tax, would not pass savings on to the public, or that the laws of supply and demand would push the price up again.

There was also the probable opposition of House Republicans, who have been reluctant to jeopardize the flow of the gas tax revenue to the highway trust fund that underwrites road and bridge projects.

"Our folks thought it might amount to nothing for consumers," said one aide who was granted anonymity to discuss internal leadership deliberations.

Under the proposal, $100 checks would be sent late this summer to an estimated 100 million taxpayers, regardless of car ownership. Single taxpayers with adjusted gross incomes above about $146,000 would be ineligible for the checks, as would couples earning more than about $219,000. The $100 figure was determined by Mr. Frist's office, which calculated that the average driver would pay about $11 per month in federal gas taxes over nine months.

The rebate was the signature element of a broader Senate Republican leadership plan announced Thursday that included new incentives for the oil industry to increase its refining capacity and for consumers to buy hybrid cars. It would open the Arctic National Wildlife Refuge in Alaska to drilling and would impose an accounting change forcing oil companies to pay higher taxes on fuel sold from stockpiles.

The proposal would also give the executive branch new authority to set fuel standards for cars, an idea that will get a hearing in the House this week.

David Winston, a Republican pollster who advises the Senate Republican leadership, called the rebate an intuitive way to show voters that Republicans were on their side. "It is like putting the American family budget ahead of oil company profits," Mr. Winston said. "How do you help the American families out? Well, give them some money."

But disapproval started flowing in almost as soon as the idea surfaced, said aides in several Republican offices. One senior aide to a Southern lawmaker said the calls were surprisingly harsh. Some complained that the rebate would amount to only two fill-ups at the gas station.

Even though some voters have been outspoken in their opposition to the $100 rebate, Democrats still want credit for being the first to think of putting money back in taxpayers' pockets. A few days before the Republicans went public with their plan, Senator Debbie Stabenow, Democrat of Michigan, proposed a $500 rebate plan, a figure that she said was more commensurate with how much the higher gas prices will cost Americans this year.

Ms. Stabenow also criticized Republicans for linking the rebate to oil drilling in the arctic refuge.

Republicans know that drilling in the refuge "is highly controversial and not going to happen," Ms. Stabenow said. "I question their sincerity in putting this forward."

When the Republican program might reach the Senate floor is still uncertain. Mr. Frist had suggested that he might try to attach the plan to the emergency spending bill the Senate is debating, but aides said that was now less likely and that Republicans might ultimately bring their proposal forward on its own.

On television news programs on Sunday, several Republicans emphasized the need for long-term solutions and played down the rebates. "I don't think much about the $100 rebate," Senator Trent Lott, Republican of Mississippi, said on "Late Edition" on CNN. "We're going to have to produce more domestic oil, natural gas. We're going to have to build pipelines, liquefied natural gas plants."

Senator Lisa Murkowski, Republican of Alaska, struck a similar note on the CBS program "Face the Nation." "I don't think it's a real answer," she said. "It's a temporary Band-Aid. I don't think that it's, again, the long-range solution."

But in his e-mail message, Mr. Ueland, the chief of staff to Senator Frist, dismissed the accusations of pandering as the inevitable price of taking any action. "It's the way of the world to dog Washington when members respond to constituent concerns, but to be responsive is part of how the system is designed."


Arianna On Bush’s Energy Policy

April 26, 2006

From The HuffPO:

The president may turn to God when it comes to shaping his foreign policy, but his energy policy is strictly courtesy of the Men Upstairs at Big Oil.

Which is why it is beyond comical to watch Moe, Curly, and Larry — sorry, I mean Bush, Hastert, and Frist — getting all blue in the face about skyrocketing gas prices, and calling on the Energy and Justice Departments to look into possible market manipulation by oil companies.

It’s the least believable call for an investigation since O.J. set out to find the real killers.

For those of you experiencing a sudden wave of déjà vu, yes, the GOP demand for a federal probe of potential oil industry price-gouging was a carbon copy of the demands Chuck Schumer made last week. Hey, maybe they just unconsciously “internalized” Schumer’s words.

If it wasn’t so despicable it would be laughable.

There was Frist on Good Morning America today, putting aside his video diagnostic skills to become one of the “Car Talk” guys. Among Frist’s helpful money saving tips for drivers forced to consider taking out a second mortgage in order to fill up their tanks: get a tuneup, drive slower, and carpool. Thanks, Dr. Goodwrench!

But Frist was just the gassy second banana. The clear headliner was Bush, who had them rolling in the aisles at a meeting of the Renewable Fuels Association, with zingers like his claim that “large cash flows” mean that “these energy companies don’t need unnecessary tax breaks”. A sentiment that didn’t stop the president from signing a GOP energy bill stuffed with some $14.5 billion in tax breaks, tax subsidies, and tax deductions for his cash-rich energy industry chums. I guess those tax breaks were “necessary.”

Bush also scored big with his impression of a guy who cares about conservation, highlighting the need to “promote greater fuel efficiency”: “And the easiest way to promote fuel efficiency,” said the president, “is to encourage drivers to purchase highly efficient hybrid or clean diesel vehicles.” As the proud owner of a pair of hybrids, I say “hear, hear.” As a sentient human being I say, "Isn't this the same guy whose administration hasn't increased fuel efficiency standards for passengers cars even a single m.p.g. in six years?” Maybe now that former GM-lobbyist (and fuel efficiency opponent) Andy Card has left the White House, Bush has finally allowed his inner-Prius owner to run free. Or maybe the lure of touting vehicles that can run on alternative energy sources to an alternative energy trade association was just too hard to resist.

How gullible do they think we are? Memo to the White House: it’s not working. Bush’s approval rating just dropped to 32% — a number at which both water and political clout freeze.

All this huffing and puffing about manipulated markets and record gas prices scream of a blatant attempt to inoculate Republicans from consumer rage over the massive earnings oil companies are scheduled to announce this week. Industry analysts predict that ExxonMobil will report first-quarter earnings of only $9.1 billion on Thursday — down from the record $10.7 billion posted in the fourth quarter of 2005. With profits like that, Lee Raymond’s $400 retirement package is starting to look a little stingy. Except to those paying through the nose at the pump.

The most honest comment on the gas price crisis came from Scott McClellan (freedom’s just another word for nothing left to lose, eh, Scottie?) who said: “This is not something we got into overnight.” Exactly. These levels of oil company profits took years of careful lobbying and planning to orchestrate.

Our oil-man president may want us to think that he’s shocked, shocked by the “large cash flows” of the oil companies, and the sticker shock drivers are experiencing at the pump, but even before Team Bush was dreaming of toppling Saddam, it was laying the groundwork for the gargantuan windfall the oil industry is seeing — starting with Dick Cheney’s secret Energy Task Force.

It’s not a coincidence that the oil and gas industries donated over $25 million to Congressional campaigns in 2004 (with 80% of that money going into Republican coffers), and another $7.2 million so far in the 2006 cycle (with 84% going to the GOP). They also doled out over $4.5 million to Bush’s 2000 and 2004 presidential runs.

And what did they get for their largess? According to Public Citizen, the top five oil companies have pocketed over a quarter of trillion (that’s with a “T”) in profits since Bush took office. Talk about a return on investment. That’s a gusher!

So for American consumers, payback is a bitch. And three bucks a gallon at the gas pump. The Bush administration has turned the White House into a full service filling station for Big Oil. And we’re the ones being forced to pick up the tab.

So don’t let the empty rhetoric and the phony outrage pouring out of the White House and the Republican Congress fool you: America isn’t facing a shortage of fuel; it’s facing a shortage of leadership.


As Gas Approaches $3 Per Gallon…

April 23, 2006

From Think Progress:

 In 2005, Exxon CEO Raked in 190K a Day

Average Americans are struggling to keep up with persistently high gas prices, now approaching $3 a gallon. Testifying before Congress last November, Exxon CEO Lee Raymond blamed the problem on “global supply and demand” and assured the public that “we’re all in this together.”

Last year, Raymond made do with “a total compensation package” of just $69.7 million or $190,915 a day, including weekends.

After his haul in 2005, Raymond has decided to retire. It’s seems that, for Raymond, not working is even more lucrative than working:

Exxon is giving Lee Raymond one of the most generous retirement packages in history, nearly $400 million, including pension, stock options and other perks, such as a $1 million consulting deal, two years of home security, personal security, a car and driver, and use of a corporate jet for professional purposes.

Exxon is now facing several “shareholder resolutions this year that criticize the company’s level of executive pay and seek to rein it in.”