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The Congressional Oil Embargo

Congress and America united when we suffered from an Arab Oil Embargo in 1973.  Now we’re suffering from a Congressional Oil Embargo.  This time, America is starting to unite on energy issues but Congress is not doing anything to solve the most urgent problem facing the country.

The Arab Oil Embargo only lasted six months.  The Congressional Oil Embargo has lasted for decades and endures to this day. 

Congress is now taking its summer six-week break, after months of doing nothing about energy prices (unless you count as action posturing and pretending).  And recall that back in 1973, Congress passed legislation within six weeks of the Arab embargo.

A bipartisan group of ten senators, headed by Sen. Kent Conrad (D-ND) and Sen. Saxby Chambliss (R-GA), claims they have a compromise proposal.  But is it for real?  One key Republican Senator privately said the group’s efforts were “fake negotiating.”

Their proposal includes a limited expansion of drilling off the shores of four states (Virginia, North Carolina, South Carolina and Georgia), conspicuously excluding Florida, all the West Coast and Alaska, but at the price of spending untold billions to subsidize alternative fuels, at least $30-billion in new energy taxes, and what sounds suspiciously like banning internal combustion engines from cars.

Needless to say, their plan deserves scrutiny in addition to the initial praise heaped upon them by those who say we must “do something” rather than “do the right thing”.

Curiously dovetailing with what Speaker Nancy Pelosi (D-CA) and Sen. Barack Obama (D-IL) suddenly say they desire, the Gang of 10’s plan is labeled a “comprehensive package.”  As we learned in studying last year’s illegal immigration legislation, “comprehensive” is Washington code-speak for saying that a little bit of reform can be accepted if it’s dominated by enough liberal goodies.  One sprig of broccoli becomes acceptable as long as it’s packaged with a ton of junk food.

The mystery is why billions of subsidies for biofuels and alternatives (atop the massive sums already spent on these since the 1973 embargo) are supposed to launch what the Gang calls an “Apollo Project” on energy?   If alternative energy isn’t affordable compared to $120 a barrel oil, when would it ever become economically practical?

Even a consensus from the Gang of 10 can be ignored by those who have the ability to act on legislation.  The House and Senate floors are barricaded against offshore drilling and ANWR-opening legislation by congressional leaders who are totally in cahoots with die-hard environmental extremists.  They’ve essentially shut down the Congress to avoid any votes on opening up America’s oil and gas reserves that are off-limits to exploration.

House Speaker Nancy Pelosi (D-CA) sees herself as Mother Earth, saying she’s out to save our planet.  Meanwhile, Senate Majority Leader Harry Reid (D-NV) uses parliamentary legerdemain to block pro-exploration votes in the Senate.

As Pelosi told ABC News last weekend, “reversing global warming” is her top concern.  She still slams the door on a “comprehensive” plan.  The typically-positive media coverage of Barack Obama makes it sound as if he’s now endorsed the offshore drilling that 73% of Americans favor.  But he hasn’t.   His words were packed full of qualifiers as he told a Florida newspaper that “if” it is part of an “overarching package”, he is “not going to be rigid” about offshore drilling.  What he really wants is a windfall profits tax that he can redistribute via giveaways to buy votes.

Weasel words can be expected to outweigh action, offering a possibility of very minor expansion of offshore drilling in exchange for a wagonload of liberal proposals.  Liberals are searching for ways to pacify constituents angered by energy prices, but without having to change their extremist environmental policies.

When Sen. Reid recently said he might consider a simple study of whether or not to expand offshore drilling, he got whacked by his fellow Democrats.  And when Reid said he might permit Republicans to offer pro-exploration amendments, he quickly retracted the offer.  He’d poked his nose out to check the political weather, but seeing the shadows cast by his party’s liberal faithful, he retreated like Punxsutawney Phil.

House Republicans tried to prevent Congress from taking its usual end-of-summer break, but lost a 213-212 vote.  Several discharge petitions have been filed to force House votes on bills to produce more oil and gas in America; one has 153 signers, but only a single Democrat.  218 signatures are needed.  At least 40 Democrats are said to be ready to break ranks and cast pro-exploration votes, but they can’t because Pelosi uses her ultimate parliamentary power to prevent votes.  She’s even shut down the appropriations process to prevent pro-drilling amendments.

The congressional embargoes on offshore drilling and oil shale drilling expire at the end of September.  Pelosi and Reid are already exploring ways to extend them by attaching them to other popular legislation and daring President Bush to veto it.  Since all federal funding expires when the fiscal year ends that day, a government shutdown showdown is a possibility. 

 Congress has damaged America far more with its long-term embargo than Arabs ever did with theirs.  Having a politically-correct and very chic Speaker hurts energy prices worse than any Arab sheikh. 

Current symptoms are stratospheric prices and massive transfers of wealth from the United States to the Middle East, Venezuela, Russia, and others.  In 1973, imports were just over a third of the U.S. supply; now they’re about two-thirds.  Other nations profit by draining our wealth by selling us oil. But if they ever cut off our supply, we’d probably see other events –similar to ones America witnessed in 1973 and 1974 — dominating the front pages and the newscasts:

–Gas station lines several blocks long.  Afraid that the stations would run out, drivers tried to top off their tanks constantly.  Stations imposed 10-gallon limits on purchases.

–Red, yellow and green signal flags flying at gas stations, signaling whether they were out of gas, limiting fill-ups, or had no limits.

–Rationing.  If your license plate ended in an even number, you only fueled on even dates, and odd dates for odd numbers. 

–Gasoline sales on Sundays were banned. 

–Congress adopted year-round Daylight Savings Time.

–The lights were left off the National Christmas Tree.

–Gasoline prices went up about 50 percent (to an average of 55-cents a gallon, which now sounds good 35 years later!)

–Most important of all:  Many of that era’s federal restrictions on energy production were gradually lifted, until the radical environmentalists counter-attacked in later years.

The 1973 embargo was retaliation by OPEC because the United States had supported Israel in that October’s Six-Day War.  The embargo extended from October 19th until the following March 17th.  

By Thanksgiving, Congress and President Richard Nixon adopted the Emergency Petroleum Allocation Act, which gave authority for federal rationing and price controls (and investigations of price-gouging claims).  Almost 5-billion ration coupons were printed, but ultimately never used.  Instead, the government stored them for ten years at a multi-million-dollar cost, before destroying them.

Today’s largest stockpile isn’t a mountain of ration coupons, but of U.S. dollars piled up in the nations that send oil to America—money they’re using to buy stakes in U.S. property, businesses and institutions.  This time, there’s so much accumulated that they could easily survive the financial hiccup if they embargoed us again.

Of course, they don’t need to.  Congress has done it for them.

How long can Congress maintain this embargo?  We may see messy scenes as Representatives and Senators take their August break.  They’ll find angry constituents who couldn’t afford to take a vacation this month, which means they’ll be there to pester the politicians who go home to face the voters.

How wonderful.

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Written By

Former Congressman Ernest Istook is now a distinguished fellow at The Heritage Foundation.

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