Consensus on Gas Policy in Congress Remains Unlikely

BY Quinn Bowman  May 17, 2011 at 4:31 PM EDT

Both major political parties in Congress can agree on at least one thing: The price of gasoline in America — at $4 a gallon — is a bad thing. Agreeing on what, if anything, should be done about that reality isn’t as easy.

The price spike, which has held this spring for nearly three weeks, is about a dollar higher per gallon than a year ago. This has spurred competing proposals from both parties: Democrats, including President Obama, are pushing for the elimination of $4 billion in tax breaks to the oil industry. They say that with prices high and oil companies making big profits, Congress doesn’t need to lower taxes.

Republican leaders advocate a supply-side proposal: lift a moratorium on deepwater drilling put in place by President Obama after the BP oil spill last year, and expand drilling leases and permits in order to boost the supply generated at home.

While the GOP-controlled House of Representatives is not in session this week, it has already passed a trio of bills — largely along party lines — that promote increased production from domestic sources. The Senate will vote this week on two measures that reflect the competing proposals: in a late Tuesday vote on ending $4 billion a year in tax breaks to the largest oil companies, and a Wednesday vote on expanding drilling.

Neither bill is expected to get the 60 votes needed needed to move forward to a final vote, but that didn’t stop plenty of on-camera appearances from senators eager to make their position known.

Senate Majority Leader Harry Reid, D-Nev., framed his side’s bill, the Close Big Oil Tax Loopholes Act, as an attempt to cut the federal deficit by eliminating a tax subsidy for an industry that is making large profits at a time of high oil prices. The savings would go to deficit reduction.

Reid said that Republican opposition to the Democratic bill showed where Republicans stood on “American values.”

“They can continue to defend the oil companies or recognize that we have to do something about the deficit and the best time to start with that is now,” Reid said Tuesday. “Instead of defending the oil companies, Republicans should be defending the American taxpayer.”

Reid also said that the legislation likely would have no affect on the price of gasoline.

Senate Minority Leader Mitch McConnell, R-Ky., accused Democrats of ignoring gas prices and argued that the Democratic proposal would raise prices.

“It’ll raise price of gasoline at the pump, export American jobs and make us more dependent on people like Hugo Chavez because the amount of oil we have to import will go up,” McConnell said Tuesday. “Clearly this is not a serious effort to address the price of gas at the pump…We will offer an alternative that very simply underscores the relationship between increasing production and lowering price.”

McConnell’s proposal, the Offshore Production and Safety Act of 2011, would force the Secretary of the Interior to increase the number of leases and permits for oil drilling. Permits not approved or denied within 60 days would automatically be approved. The measure also mandates a study on federal response to oil spills.

The Senate will vote on that proposal Wednesday.

Expensive gasoline in America is likely caused in part by turmoil in the Middle East and the growing economies of China and India, and that reality means yet another week of debate on Capitol Hill without any sign of Congressional compromise.

Sen. Jeff Sessions, R-Ala., explained to the NewsHour why the doomed oil policy votes were worth holding.

“I don’t think it’s purely political…it’s not bad politics to make senators step up and say what they believe in. It’s better than not voting…” Sessions said. “It exposes you and then you have to talk to your constituents and explain why it didn’t benefit America to do this or that.”