Addressing Oil and Gas Consumption in the U.S.

An energy analyst has made the bold claim that "…because we are a consuming country [America], we feel we have an inalienable right to drive anywhere." This may be at the heart of the nation's consumers concern about escalating gasoline costs. In a presidential election year, this may be the new political bone of contention and may reflect an on-going need for an efficient and sustainable national energy policy.

In 1996, Bob Dole seized an opportunity to exploit an issue that cuts across party lines-a small upward hike in gas prices was used to jab at President Clinton. Dole tried to repeal the 4.3 cents per gallon increase that Clinton had signed into law in 1993 as part of his tax-heavy deficit reduction plan (P.L. 103-66). The 1996 repeal effort easily passed the House but fizzled in the Senate. Now four years later, some Republicans see a similar opportunity to attack Vice President Gore. After all, he cast the deciding vote in 1993 to impose the tax. As in 1996, however, this did not work because Republicans are divided on the tax issue of repealing the tax.

At the beginning of April, Senate Majority Leader Trent Lott (R.-Miss.) had pushed to include a non-binding amendment into the FY 2001 budget resolution to repeal the 1993 tax increase and to suspend the entire gasoline tax if prices hit $2 a gallon. The vote was 66 to34 against Lott's proposal. Among senators opposing the repeal were Warner (R-Va.), Voinovich (R-Ohio) and Ashcroft (R-Mo.). House Republicans led by House and Transportation Committee chair Bud Shuster (Pa.) opposed the repeal, claiming it had the potential to weaken the highway trust fund. They noted that there is no guarantee that prices at the plump would drop if the tax were cut. The federal tax is not actually imposed at the pump; it is collected shortly after it leaves the refinery. The fuel can pass through several hands before reaching the consumer and none would have to pass along the saving. Another attempt by Lott to have the gas tax repealed was rebuffed by the Senate once again on April 12.

Gas Tax Background

In 1980, the federal gas tax was four cents per gallon, earmarked for road construction only. The tax rose five cents under President Ronald Reagan in 1982 and another five cents under President George Bush in 1989. The next increase under Clinton in 1993 was earmarked for deficit reduction, with all gas tax revenues dedicated to the General Fund. The current tax is 18.4 cents for a gallon of regular gasoline and 24.4 cents for a gallon of diesel fuel. This does not include state and local fuel taxes.

In 1997 Congress passed legislation requiring all federal gas tax dollars to be spent on transportation, negating the 1993 fee directed at deficit reduction. Congress transferred the revenue from the taxes imposed on highway users to the Highway Trust Fund to help pay for highway and transit infrastructure and for highway safety programs. Congress also transferred the revenue from the aviation fuel tax into the Airport and Airway Trust Fund to support aviation programs; however, taxes paid by railroads and the barge industry still go into the General Fund. These congressional actions resulted in the record-breaking $182 billion transportation bill in 1998. It became the largest public works program in American history.

Considering Solutions

During the last six months, fuel costs nationally have risen nearly 100 percent, to more than $1.50 for regular. This has prompted lawmakers and consumers to push for temporary or permanent solutions. Some of the most prominent proposals include negotiating with Oil and Petroleum Exporting Countries (OPEC), a cartel of oil-producing nations, to increase production; releasing some crude oil from the United States' 575 billion barrel Strategic Petroleum Reserve; and partially or fully repealing the federal gas tax.

A worldwide glut of oil in late 1997 through early 1999 produced a windfall for consumers and businesses highly reliant on oil, but it was disastrous for the U.S. oil industry. America currently imports 55 percent of its oil, creating an over-dependence on foreign oil. While Department of Energy Secretary Bill Richardson has persuaded Bill Richardson has persuaded OPEC to raise oil production, the U.S. oil industry trade association also wants the Clinton Administration to review the financial impact expected this year as a result of four new environmental regulations.

The U.S. Environmental Protection Agency (EPA) already has required refiners to overhaul their equipment to remove sulfur and the additive MBTE from gasoline. Two more requirements-reduction of benzene in gasoline and sulfur from diesel fuel-are expected later this year. Moreover, the domestic oil industry is pushing for new oil exploration in the U.S. Red Cavaney, president of the American Petroleum Institute, has called for exploration along both U.S. coasts, in Alaska, underneath the Rocky Mountains and in the Gulf of Mexico. Since access to 60 percent of the land, such as the Arctic National Wildlife Refuge (ANWR), is federally controlled, Mr. Cavaney urges that restrictions on oil exploration be relaxed. At least one lawmaker agrees. Sen. Jesse Helms (R-N.C.), chair of the Senate Foreign Relations Committee, called for more offshore oil exploration, including drilling off the pristine beaches of his home state.

Environmental groups, led by the Sierra Club, are strongly opposed to offshore drilling. According to Charles Benjamin of the Kansas Sierra Club, "It is much cheaper to engage in conservation than to find new sources of oil. That doesn't mean a big trade-off in our standard of living." He suggested conservation has value and there are steps to be taken such as making cars more fuel-efficient before considering drilling in the Alaska wilderness or expand offshore reserves. This approach is more consistent with the 1989 report by the Presbyterian Eco-Justice Task Force, "Keeping and Healing the Creation." The task force observed that the most readily obtainable deposits were taken first, thus, we must expend energy to get more energy. There is an "energy cost" in finding, extracting, refining and transporting petroleum. In some cases, there is also a cost to the environment.

Meanwhile, the Strategic Petroleum Reserve law expired because Congress failed to meet a March 31 deadline for reauthorization (H.R. 2884-H. Rept. 106-359). Although Joe Barton (R-Tex.), chair of the House Commerce Subcommittee on Energy and Power, pressed House leaders for action, there was none. There was not even a short-term extension such as one (P.L. 106-64) that kept the authority current since last October.

The petroleum reserve consists of 575 million barrels of crude oil stored in Texas and Louisiana. The reserve is to be used in times of "severe emergency supply interruption," according to the law that created it in 1975 (P.L. 94-163) during the Arab oil embargo. This leaves President Clinton with limited legal authority to operate the network of oil reservoirs in salt caves along the Gulf Coast. Secretary Richardson has indicated that OPEC's decision to raise production makes release from the strategic oil reserve unnecessary.

CAFE Standards

Other gas and oil issues are a repetition of earlier policy debates. A recurring issue, corporate average fuel economy (CAFE) standards, were enacted in 1975 by President Ford and Congress in response to the formation of OPEC which caused gas prices to skyrocket. To decrease U.S. dependence on imported oil, the government set gas mileage goals. Under CAFE, cars must get 27.5 miles per gallon. The law also requires automakers to produce vehicles that limit gas consumption and its accompanying pollution. Higher CAFE standards would not only help reduce dependence on imported oil, but raising standards will also decrease the pressure to drill in fragile ecosystems such as the Arctic National Wildlife Refuge (ANWR) and the California Outer Continental Shelf.

As consumers are complaining about gas prices, increased CAFE standards could bring some relief. The big three U.S. auto makers (General Motors, Ford and Daimler Chrysler) have each developed a "concept car" that boast fuel-saving "clean diesel" engines-considered a testament to the achievements of a seven-year collaboration between automakers, federal agencies and research labs. Two of the cars achieve 72 miles per gallon (mpg) gasoline equivalency, or 80 mpg of diesel, while the other gets 90 mpg of diesel, the equivalent of 80 mpg of gasoline.

All three automakers have worked together in a Partnership for a New Generation of Vehicles (PNGV) to achieve a basic concept for a fuel-efficient vehicle. The aim is to meet Tier 2 emissions standards, announced last December by President Clinton and the U.S. Environmental Protection Agency (EPA). These regulations, which will be phased in between 2004 and 2009, mandate very low levels of tailpipe emissions of hydrocarbons, nitrogen oxides and particulate matter. The regulations are significantly more stringent than the Tier 1 standards that were in place when PNGV was launched, or when the Partnership completed its initial technology phase in 1997.

Unfortunately the automakers to produce a mass market in the near future: the soonest may be 2003 or 2004. The reason given is that technology costs are too high for large volume production. Some environmental groups, however, question the delay. Katherine Silverthorne, staff attorney for the U.S. Public Interest Research Group (US PIRG) in a statement said, "The Partnership for a New Generation of Vehicles has funneled more than a billion taxpayer dollars to the Big Three automakers to produce a prototype 'supercar' by 2003. Meanwhile, Honda and Toyota, neither of whom received any of this funding, are already selling vehicles that get 70 miles per gallon." The Big Three countered that Japan is losing money on both of its low emissions, fuel-efficient cars, because they cost more than their retail price.

Another Energy Crisis?

Is there a real energy problem in the U.S. or are we merely going through a period of inconvenience? It may depend upon the point of reference. Consumers, individuals and small businesses may feel that the financial impact of gas and oil costs is unacceptable. Politicians may see this as an opportunity to attack their opponents and/or advance their agenda. Regardless of orientation, the fact is that sources of energy, which sustain industrial, technological society, are overwhelmingly nonrenewable. Approximately 75 percent of this nation's energy comes from oil and gas, and well over half of U.S. oil deposits have been used up. What is needed at this time is national leadership that promotes sustainability-i.e., living within the bounds of the regenerative, integrative and carrying capacities of the planet (both human and nonhuman).

A number of Presbyterian General Assemblies has addressed the issue of energy policies. Among them are "Christian Responsibility in the Energy Crunch" (1974 UPCUSA), a joint pastoral letter to all Presbyterians on the subject of energy ethics from PCUS and UPCUSA (1979), joint PCUS-UPCUSA (1981) energy policy on "Speaking Truth to Power," and PC (USA) 1990 policy on "Restoring Creation for Ecology and Justice." "Restoring Creation…" calls for Christians to follow norms of sustainability, sufficiency and justice-ethical standards that can be a guide to political decisions, economic practice and daily lifestyles.

Written by Bernadine Grant McRipley of the Washington Office, Presbyterian Church (USA).

Suggested Actions

1. CAFE standards have not been significantly adjusted since the late 1980s. Urge your Representative and Senators to become and Senators to become advocates for raising CAFE standards. Let them know you will raise this issue with them and candidates running against them for office. Point out that higher standards will help to reduce dependence on imported oil. The average family will save more money, which can be spent in local communities and on other necessities. Stress that technologically, energy efficient vehicles can save money in the long run and will also help to save our planet from destructive climate change that is caused by human actions.

Contact can be made by letter, telephone or email. If possible, attend candidates' meetings and publicly state your concern to your legislator. State your case briefly, clearly and politely. Ask for their position on the issue. If you have written a letter, send a copy to your local Letter to the Editor. If printed, send a copy to your legislators. Use local radio talk shows for your advocacy in the public arena. Create and use media opportunities to promote raising CAFE standards.

2. Sen. Frank Murkowski (R-Alaska) and chair of the Energy and Natural Resources Committee introduced S. 2214 that would allow oil drilling in a portion of the Arctic National Wildlife Refuge (ANWR) in Alaska. A hearing was held on April 5 and no further action has been taken at this time. However, in the 2001 budget resolution (S. Con. Res. 101) debate, the Senate voted 51-49 that ANWR should be opened to commercial drilling. President Clinton has stated that he will veto any legislation allowing ANWR to be opened.

Moreover, the Senate bill will have to be reconciled with the House bill (H.Con. Res. 290) which does not have ANWR language. Urge the president to veto any legislation that opens ANWR for commercial drilling. Also let your senators and representative know that short-term increase in oil supply is not worth what Sen. Roth (R-Del.) calls making "an irreparable mistake in one of America's remaining natural treasures."

Identify yourself as a Presbyterian. Members of Congress need to hear from the religious community as well as special interest groups. Unless you inform them, they will not know that you are a person of faith.

Honorable_________
U.S. Senate
Washington, DC 20510

Honorable_________
U.S House of Representatives
Washington, DC 20515

Capitol Switchboard: (202) 224-3121

General Assembly

The 1990 policy, "Restoring Creation for Ecology and Justice," addresses the issue of CAFE standards and the 1996 policy, "Hope for a Global Future: Toward Just and Sustainable Human Development," speaks to the ethical issues regarding sustainability.