Archive for September, 2008

Washington dramas

Thursday, September 25th, 2008

The biggest battles on Capitol Hill sometimes aren’t between Democrats and Republicans, but rather between the House and Senate. On Tuesday, the Senate passed (and the White House indicated that if it passed the House as is it would be signed) a tax extender package.  This compromise package was approved 93-2 and included a whole slew of provisions from renewable energy tax credit extensions, to plug in hybrid consumer tax credits, to provisions that dealt with the Alternative Minimum Tax and disaster relief — in short, a very delicate balancing act. 

So delicate, that Senate Majority Leader Harry Reid (D-NV) had the following to say when the bill was sent back to the House:

“I hope the House accepts what we do. I do my very best to get along with the House, the Democrats and Republicans.  But everyone should understand that we have had a very difficult time getting to the point where we are in passing this final version of this bill.  If the House doesn’t pass this, the full responsibility of this not passing is theirs, not ours.”

Reid also said:

“I say to my friends on the other side of the Capitol, the House, don’t send us back something else. We can’t get it passed. If they try to mess with our package, it will come back here, it will die, and we will have snatched defeat from the jaws of victory.”

Pretty strong words, provoking the following statement from House Republican Whip Roy Blunt (R-MO):

“It’s rare that I agree with the Senate Majority Leader, but when it comes to changing this critical tax relief bill, I agree with him one-hundred percent.  To those in the House that wish to either split this bill up or add unrelated provisions to it, they must understand that they are imperiling this vital piece of legislation.  The House must take up and pass the Senate bill as is.”

Well, Washington being what it is, the final plan on the table in the House today differs pretty substantively from the Senate package and just got a White House veto threat because it separates the energy provisions (which the House altered as well) from the overall compromise package:

“The Administration is disappointed that the House has decoupled this legislation from AMT relief [...]By doing so, the House invites certain delay of this important piece of legislation being signed into law [...] The Administration urges the House to adopt the Senate Amendments to H.R. 6049 passed by the Senate on September 23, 2008, in their entirety. If H.R. 7060 were presented to the President, his senior advisors would recommend that he veto this bill.

Stay tuned.

OPEC on steroids

Thursday, September 25th, 2008

Russia isn’t a member of OPEC, but has the attitude down pat:

Russia wants to influence global oil prices through output forecasts and mothballing deposits for future development, Shmatko said on Thursday.

Shmatko said Russia’s policy would not involve coordinated action with OPEC states, although he said Russia admired OPEC’s influence on prices and should do its part to smooth the oil price “roller coaster ride” of recent months.

“We think that since we have such a significant position in the high society of world oil, a Russian factor should appear. We want to formulate our approach,” Shmatko told reporters.

“We think we should be more actively engaged in the market … From the point of view of forecasts we could express our view, perhaps even actively engage in that in a practical way,” Shmatko said. “The idea of mothballing oilfields seems very interesting to me.”

Gal Luft discussed the Saudi oil mothballing attitude in a recent Baltimore Sun oped:

[Saudi] per capita oil reserves are 130 times that of the U.S. Upon recent discoveries of oil in the kingdom, King Abdullah ordered that those new finds be left untapped to preserve the nation’s oil wealth for future generations. “When there were new finds, I told them, ‘No, leave it in the ground, with grace from God, our children need it,’” the king said.

So we can expect Russia to join the “Drill less” faction –(in case you missed Gal Luft’s recent Senate testimony: whenever non-OPEC countries drill more, OPEC drills less.) As the Department of Energy’s Energy Information Agency put it, focusing specfically on increased US drilling: “Assuming that world oil markets continue to work as they do today, the Organization of Petroleum Exporting Countries (OPEC) could neutralize any potential price impact of ANWR oil production by reducing its oil exports by an equal amount.”

Edwin Black calls for Open Fuel Standard on Glenn Beck

Wednesday, September 24th, 2008

Set America Free Coalition member Edwin Black, who just came out with a new book titled “The Plan: How to Save America When the Oil Stops -or the Day Before” appeared on the Glenn Beck show on CNN last night:

BECK: Edwin, you say democracy — fuel democracy should be the rule. What exactly does that mean?

EDWIN BLACK, AUTHOR OF “THE PLAN”: Well the fuel democracy that I’ve called for mandates that our country take whatever good alternative fuel and propulsion method is best at hand, whether that`s compressed natural gas, whether that is sugar cane ethanol, where that is methanol, whether that is bio-fuel, second generation bio-fuel. That is the way that we will get off of oil, and that really calls for an open fuel standard, a flex fuel standard and what’s more important is that our nation is completely unprepared for an oil interruption.

BECK: Edwin, please, talk about that just a little bit, because I don`t think people understand. The straits of Hormuz; that is right off of the coast of Iran, just Iran just said deciding to say we`re just going to make sure we shut this down. That would, what would that mean to America and our economy?

BLACK: The Strait of Hormuz is the only place that can kill America. It is two miles wide in each direction. It is right off the coast of Iran, going underneath the pockmarked caves of Iran which is rich with silk worms, exsiccate missiles, the Al Qaeda is there. If the Strait of Hormuz is blocked, it`ll block 40 percent of all sea-borne oil, 18 percent of the global supply and 15 percent to 20 percent eventually of America`s supply.

Plug in hybrid tax break pass the Senate

Wednesday, September 24th, 2008

Plug in hybrid consumer tax credits (along with a few other important but more technical transportation electrification related tax provisions) made it through the Senate last evening as part of the renewable energy tax extenders package. (This is the same plug in tax credit provision that made it through the Finance Committee last winter but together with the rest of the energy tax package, failed on the floor because of the congressional offset wars.)

Still need to get through the House, but so far so good.