The Washington Post reports, "Oil prices surged to a record above $78 a barrel Thursday in a market agitated by escalating violence in the Middle East and the threat of supply disruptions there and beyond."
"U.S. gasoline demand continues to rise in spite of near $3-a-gallon pump prices, core inflation remains relatively low and the U.S. economy is forecast to grow by roughly 3 percent in the second half of the year.
"Two years ago I might have said that $70 or $75 a barrel would be some kind of a tipping point. Now I'm not so sure anymore," said Nariman Behravesh, chief economist at Global Insight, a private forecasting firm."
"The surge in oil prices rattled stock market investors, sending the Dow Jones industrials sharply lower for the second straight day. Shares of Wal-Mart Stores Inc., the world's largest retailer, slumped 2 percent on the New York Stock Exchange on concerns that high energy prices are cutting into consumers' discretionary income."
"With U.S. oil companies such as Exxon Mobil Corp. and Chevron Corp. earning record amounts, some members of Congress have proposed taxing "windfall" profits in order to finance energy assistance programs for the poor, but the idea does not have wide support."
"We too often forget that the United States is far and away the biggest consumer of oil," said Tyson Slocum, an energy expert at Public Citzen, a Washington-based consumer watchdog. Slocum said the country needs to invest more in public transportation and to sharply increase automobile fuel-economy standards."
I really don't know what else I can add to this news. I do, however, have a few questions that I would like answered.
How much longer can this trend continue? How much longer will our dangerous addiction force us to fund both sides of the war on terror? What will it take for our leaders in Washington to get serious about alternative fuels, hybrid vehicles, and energy independence? Do you want a U.S. Senator who will invest in alternative fuels and make our nation energy independent, or do you want someone who's only answer is to drill more and open more refineries?
Finally, are you fed up when you fill up? Because if you are, there is only once answer this year--vote for Harold Ford Jr. in November!
He is the man with the plan to get our nation on the right path when it comes to energy! (Read below)
The Plan: Securing America’s Energy Future
By Harold Ford, Jr.
More than four years after the September 11 attacks, we use and pay more for energy than we did before September 11. Every day, we ask more than 150,000 brave men and women to make the ultimate sacrifice to protect our lives and our values. Yet we at home are unwilling to change the way we live, drive and do business. Every time we fill our tanks with gas or turn on the lights at home or at work, we subsidize nations that support terrorists. To my knowledge, we are the only nation in the history of the world to fight a war and pay for both sides at the same time. This is inexcusable.
Of course, the energy crisis does far more than impact our national security; it also harms our financial security. Rising energy prices make it harder for working Tennesseans to pay the bills and make our businesses less competitive. As gas prices rise above $3 a gallon–and experts tell us that they will continue to rise for the foreseeable future–working Tennesseans are forced to spend $50 to $70 every time they go to the pump. Tennessee families will spend $1,770 more this year to fill up their cars than in 2001, an increase of 87 percent.
Likewise, Tennessee companies are having a harder time competing globally as the price of oil and natural gas skyrockets. For example, International Paper in Memphis spent more than $1 billion on energy last year alone. AFG Glass in Kingsport has seen its profits squeezed as its energy costs have soared from $900,000 a month to more than $3 million. Global competition forces AFG to charge 1983 prices for its glass, but 2006 energy costs make it harder and harder to survive.
The problem will only get worse. Countries like China, India and Indonesia will drive up world energy consumption by 57 percent by 2025. Global oil consumption alone will increase from 82 million barrels a day in 2004 to 111 million barrels a day in 2025. Over the same period of time, U.S. demand will increase by over a third while our crude oil production will fall, meaning we will be competing with more countries for less oil. In fact, we are projected to import 5.25 billion barrels of oil in 2020, an increase of 15 percent over this year.
Something has to give. We need a new and comprehensive energy policy that prepares us for the 21st century challenge and cures our oil addiction.
As a nation, we have overcome great challenges in the past. When led, we are capable of extraordinary acts of national will. When we were suffering during the Depression, a leader named Roosevelt brought electricity to Tennessee with the TVA. When a world war revealed our infrastructure’s inadequacies, leaders named Gore and Eisenhower created the interstate highway network and drove economic development. When the Soviets beat us to space, a leader named John Kennedy said we would put a man on the moon before the end of the decade. And we did, with a year to spare. When we had millions of elderly cut short because they could not afford health care, a leader named Johnson created Medicare to protect our seniors.
We need to go back to the kind of big ideas and bold thinking that made this country great. We need to create this generation’s moon shot by becoming energy self-sufficient by 2025. Doing so will not be easy. It will require an extraordinary commitment of our nation’s intellectual, financial and industrial resources. But just as great leaders saw us through the Depression and the Space Race, a new generation of leaders will help us overcome this latest challenge. Here is what we must do:
Improve Energy Efficiency Through Technology. Seventy percent of our oil consumption is for transportation; it fuels the cars we drive, the trucks we ship and the planes we fly. Increasing our average fuel efficiency by even a few miles to the gallon will dramatically reduce the amount of oil we consume each year.
We need to significantly increase use of hybrid engines. Despite their fanfare, hybrids will still only account for 4 percent of all vehicles sold in the U.S. in 2010, while gas-guzzling SUVs will account for 27 percent of the market. That is why I sponsored a law that will aggressively promote the next generation of hybrid and advanced diesel engines.
It will also create quality, high-paying jobs here at home, like the 6,700 men and women who produce Nissan’s hybrid vehicles in Smyrna and the dedicated workers at FedEx who recently launched a new hybrid delivery truck that increases fuel efficiency by 57 percent and improves our environment by reducing harmful emissions by 65 percent.
I also propose removing the current cap on the number of tax rebates for hybrid vehicles, requiring 30 percent of the government auto fleet be driven by hybrid and advanced diesel engines, and creating a 35 percent tax credit for automakers to retool their factories to make energy efficient, advanced technology vehicles.
Finally, we must require federal agencies to reduce U.S. oil consumption by 10 million barrels of oil a day by 2031. By creating meaningful incentives to change behavior, we can reduce consumption and overcome our addiction.
Invest in Alternative Sources of Energy. To reduce our addiction to oil, we need to push promising examples of “green” and energy efficient prospects right here in Tennessee. For example, experts at Oak Ridge National Laboratories and the University of Tennessee system are developing farm-based fuels based on soybeans, corn and switchgrass grown in Tennessee.
Soydiesel is more efficient than ethanol and no new technology is needed to use it in our cars and trucks; existing diesel engines can run cleaner and just as powerful on soydiesel blends as on traditional diesel fuel. In fact, some new farm equipment now comes with fuel tanks full of biodiesel fuel. The United States already produces enough soybeans to replace 5 percent of diesel fuel, and Tennessee farmers can lead the way. Every year, they produce 46 million bushels, or 1.4 million tons, of soybeans. We need to provide tax breaks and meaningful incentives to increase production of biodiesel and make it widely available.
Cellulosic ethanol is fuel made from biomass like trees, shrubs and switchgrass. Researchers at the University of Tennessee are leading the way in developing an economically viable cellulosic fuel. In June 2004, 32.5 acres were planted with different varieties of switchgrass on four sites at University of Tennessee-Milan. The University is working in partnership with local farmers, TVA and Alabama Power in the study, which is expected to continue through the end of this year. This pilot program can serve as a national model for the kind of renewable fuels that will break our addiction to oil.
Corn is also a promising source of renewable fuel. E10 fuel–which is 10 percent ethanol and 90 percent petroleum–is compatible with all cars. The only hold-up is developing the infrastructure to provide adequate supplies to gas stations. We need to provide tax incentives to promote production and increase capacity.
Most cars can run on E85 fuel, which is 85 percent ethanol and 15 percent petroleum, with a simple and relatively inexpensive modification. We need a new energy bill, one that will create the incentives to push the major oil companies to offer E85 fuel nationwide so consumers will have an alternative to traditional gas.
Tennessee companies are leading the way in commercializing other forms of renewable energy as well. In Memphis, Sharp Corporation has built a solar panel manufacturing plant that is the top producer of solar panels in the United States. With demand for solar power is growing by roughly 20 to 30 percent a year, the Memphis plant will play a large role in a more energy efficient future.
In addition, the Tennessee Valley Authority has installed cutting-edge wind turbines on Buffalo Mountain near Oak Ridge to make wind energy a major contributor to TVA’s operations. These 18 wind turbines generate enough energy to power more than 3,500 homes in the Tennessee Valley. All told, wind power accounts for 75 percent of Green Power Switch, TVA’s green power service.
More than 90 local power companies offer TVA’s renewable energy option to consumers throughout the Tennessee Valley. More than 8,300 residential customers and 450 businesses are purchasing green power each month. We should use this effort as a national model to promote solar and wind-generated power, as well as other green energy wherever feasible.
Finally, scientists at Oak Ridge are changing how we power cars and light trucks with its FreedomCAR and Fuel Partnership programs. These initiatives will develop cars and trucks that run on hydrogen fuel cells rather than traditional internal combustion engines. As a result, they do not use gasoline and are emission-free. In addition to overcoming our addiction to oil, this technology could clean the air, especially around the Great Smoky Mountains.
Suspend Gas Taxes at the Pump. Finally, to help working Tennesseans at the pump, we should suspend the 18.4-cent per gallon tax for thirty days. After the first thirty-day suspension, we should assess whether it should be extended. In the meantime, temporary relief at the pump is better than nothing, especially as we learn that oil company CEOs are pocketing hundreds of millions of dollars while we are all left to pay more than $3 a gallon. We can pay for this tax suspension with a temporary windfall tax on oil companies.
The benefits of energy independence are widespread. In addition to lowering gas prices and improving our national security, overcoming our addiction to foreign oil will spur innovation, and create profitable new companies and high-paying jobs.
Energy independence will also increase demand for crops produced here in Tennessee that can be used for farm-based fuels. This will strengthen our nation’s farms and reduce the need for additional subsidy programs. In fact, investment in farm-based fuels could be this nation’s most powerful rural economic development program in the last half century.
Our nation has shown time and again that when the stakes are highest, Americans deliver. Forty-five years ago, we answered President Kennedy’s challenge to make it to the moon. Today, we must answer the call to make our country safer, stronger and more secure. Our economy, national security and environment depend on it. A new generation of leadership is ready to answer the call.
Days of Congressional Inaction on Ethics
Above is the number of days that have passed since Jack Abramoff pleaded guilty to bribing Congressman.
It is also the number of days in which Congress has failed to pass an ethics reform bill that would limit private travel, ski and golf junkets, and would call for a full disclosure of expenses by lobbyists on members of Congress.
It is time for Congress to step up and pass an ethics reform bill that would do all of the above. In addition, it is time to end the pork barrel spending system as we know it and establish an independent ethics commission that would review ethics complaints against members of Congress.
I am proud Congressman Harold Ford Jr. is fighting for that reform!