Bill to Boost American Energy
CAFFERTY: It took a while -- what, five, six years? Congress finally passed a bill this week designed to revamp America's energy policy. That's right. We have an energy bill. But don't panic. This does not mean you have to start powering your car with cow manure or table scraps. Not just yet. In fact this bill is all about the opposite. It's aimed at ramping up production of old school energy sources like oil, gas, coal, and nuclear power. It has $14.5 billion in tax breaks and subsidies to try to make it happen. Guess who gets that money? Well it ain't going to be you and me. For one take on the new bill, we are joined from Washington by Tyson Slocum, who is the research director of the energy program at Public Citizen, a consumer protection group. Tyson, nice to have you with us. Thanks for being on the program.</s>TYSON SLOCUM, RESEARCH DIRECTOR, PUBLIC CITIZEN: Glad to be here.</s>CAFFERTY: Based on your affiliation, I must assume you're probably not enamored with this piece of legislation?</s>SLOCUM: Well most Americans shouldn't be happy with this legislation. I mean it's the best bill that the energy companies could buy. Their millions of dollars in campaign contributions secured them billions of dollars in tax breaks and subsidies. That's a huge return on their small investment in America's campaigns.</s>LISCOVICZ: Tyson, I don't know why you'd be upset about that. I mean the oil companies are only making record profits from $60-a- barrel oil. Let me just ask you this. That's not the only part of this massive package. There are some tax breaks for doing good things, like conserving energy, like using alternate forms of energy. There are some good things in this bill, are there not?</s>SLOCUM: There are some good things, but they are way overshadowed by the bad things. And so that is why on the whole this energy bill is bad for energy policy, it is bad for fiscal policy, and consumers are going to lose out.</s>LISCOVICZ: Give me some specifics about what actually is good and how that compares, if you will?</s>SLOCUM: Sure. The good things are, there's some tax incentives for homeowners and small businesses to improve the energy efficiency of their homes and businesses. There's a small tax break for manufacturers of energy efficient appliances. And there is about $3 billion in tax breaks for renewable energy like wind and solar and things like that. But that is a minuscule amount compared to the billions to oil companies, to coal companies, and to the nuclear power industry. I mean, the oil industry alone gets almost $3 billion. They've got $1 billion in tax breaks for their pipelines and they get another $1.5 billion in direct cash subsidies to encourage them to drill in the Gulf of Mexico.</s>SERWER: Yes. But by virtue of the fact that some oil companies and oil lobbyists and oil trade groups are actually not thrilled with this bill, Tyson, you know, there are some positives in that sense as well. For instance, the Arctic Wildlife Refuge, that's not part of the bill that is not opened up. They wanted to open up more parts of the west; they wanted to open up more coastal parts for drilling. They were denied that. So you can't say this is a total give away to the oil and gas industry.</s>SLOCUM: Actually, it's worse, because the oil companies -- the oil companies are getting paid more to do what they were already doing, rather than increasing production.</s>SERWER: What about ANWR? I mean come on. You got a victory there, didn't you?</s>SLOCUM: Not really. To be honest, the oil companies didn't want to drill up there. You got to remember, the United States is the third largest oil-producing nation in the world. Only Saudi Arabia and Russia produce more oil every day than we do. Even if we ramped up production, we doubled production to what Saudi Arabia does, we would still be importing half of our oil. So there is no way that providing more incentives to oil companies as this energy bill does, it's not going to do a thing to address the problem of our dependence on foreign sources of oil.</s>CAFFERTY: Let me get your take on this. Forty percent of the oil we consume in this country goes into the gas tanks of passenger cars and trucks, 40 percent. The EPA held up release of a report this week, coincidental with the passage of the energy bill -- or perhaps not so coincidental. They held up the release of a report this week that shows that fuel efficiency in American automobiles and trucks is worse in 2005 than it was in the 1980s. The energy bill, which was voted on at midnight under cover of darkness by those worms in the nation's capital that call themselves the Congress, contains nothing that addresses the fuel efficiency of motor vehicles in this country which consume 40 percent of the oil that we use. What is up with that?</s>SLOCUM: You're absolutely right. There has been a revolution in the American economy with the infusion of technology producing huge gains in efficiency, except in the automotive industry. As you pointed out, as this buried EPA report points out, our fuel economy standards are worse today than they were in the late 1980s. That's a disgrace and it is also the biggest reason why we are forced to import more oil today from dangerous and volatile regions of the planet. There's no question that improving fuel economy standards is the best way to reduce our reliance on foreign sources of oil. This energy bill doesn't do that.</s>LISCOVICZ: What about keeping the price of oil down, though? Because we are the biggest consumer, country in the world by far.</s>SLOCUM: Yeah, absolutely. I mean, that's an important point is that consumption trends in the United States are a driving influence on global oil prices. Everyone talks about the increased consumption by China and India having an effect on global oil prices. Everyone forgets that U.S. oil consumption continues to grow at a steady pace. And because we are the single largest consumer of oil on the planet -- we use 25 percent of the world's oil every day -- our consumption patterns have the biggest impact on global oil prices. And until we address consumption of oil, global oil prices are going to continue to skyrocket and this energy bill does nothing to shield consumers from those high prices.</s>SERWER: Tyson, you're so concerned about oil. I'm sure you're pleased then the bill provides incentives to nuclear power, aren't you?</s>SLOCUM: Well nuclear power and oil are two totally different things.</s>SERWER: Well sure, but aren't you pleased with that?</s>SLOCUM: Not really, because first of all, nuclear power is economically and environmentally unsustainable. We still have no solution for the higher level radioactive waste. I think it's arguable to say that the waste produced by nuclear power plants is worse in some cases than the waste in emissions from coal or natural gas power plants. And also the fact is we've got cradle-to-grave subsidies for the nuclear power industry in this energy bill. They get tax production credits. So every kilowatt of electricity produced at a nuclear power plant, taxpayers are going to subsidizing it. Companies that financially invest in nuclear power plants are going to be backed by taxpayers. Taxpayers should not be subsidizing a mature industry like nuclear power, especially with its safety and security concerns. We should only be investing in truly renewable and safe energy like wind and solar and hydrogen.</s>SERWER: All right. We're going to have to leave it at that, Tyson. Tyson Slocum, Public Citizen, research director of the energy program there. Thank you for your opinions.</s>SLOCUM: Thank you. Coming up after the break, the virtual department store! Amazon's one star from the dot com's boom that didn't go bust. See how its latest numbers are playing on Wall Street. Plus, out of this world. A worker paycheck isn't in the same universe as the CEO's compensation. Find out about a plan to bring the boss' salary back down to Earth. And thinking now about later. You can shovel money at your retirement, or you can set a realistic goal. We'll speak with a financial advisor who says some people may be saving too much.