GOP offers relief to oil consumers

Sweeping package called politically impractical

April 28, 2006|By MAURA REYNOLDS | MAURA REYNOLDS,LOS ANGELES TIMES

WASHINGTON -- Fearing public ire over rising gasoline prices, Republicans unveiled yesterday a sweeping - if politically impractical - package of measures to give consumers some relief, including a proposed $100 taxpayer rebate.

Democrats derided the Republican proposal as insincere, arguing that it incorporates ideas already introduced by Democrats and contains provisions sure to torpedo Senate passage, including a measure to open the Arctic National Wildlife Refuge to drilling that has repeatedly been voted down.

"Joining a rebate for consumers with drilling in an answer that they know is so controversial is not, I believe, a sincere effort," said Sen. Debbie Stabenow, a Michigan Democrat who was the author of an earlier proposal for a $500 taxpayer rebate. "I think that they understand that they are in trouble."

With emotions running high on both sides, a Democratic senator staged a 4 1/2 -hour filibuster, refusing to leave the Senate floor in an effort to force oil companies to pay more to drill for oil on public lands.

"Government subsidies may be needed when the price is low, when we have to stimulate production," said Sen. Ron Wyden of Oregon. "But billions of dollars of royalty relief for oil companies are not needed at a time when prices are soaring to record high levels."

Wyden finally relented after 4 hours and 36 minutes when Senate Democratic leader Harry Reid of Nevada asked him to stand down.

By the end of the day, the two parties had essentially played to a draw - neither the rebate idea nor Democratic proposals appeared to have much chance of becoming law. But the political theatrics showed that in the face of rising prices at the pump, each party hopes to direct the public anger toward the other.

At an outdoor news conference with the Capitol dome as a backdrop, Republicans blamed the current gas price crisis on Democrats, who they said have blocked measures including Arctic drilling to increase oil production.

"Those who stand up and criticize for high gas prices and suggest that somehow or another that the blame is upon those of us who had been pushing for increased supply of energy in this country, I think they need to look in the mirror," said Sen. Rick Santorum of Pennsylvania, who leads a Republican task force on energy that drew up the proposal. "Democrats are the ones who have simply blocked every attempt for us to build transmission networks, whether it's electric transmission networks, or whether it's oil and gas networks, or whether it's energy generating, or whether it's oil and gas production."

Democrats blamed the high prices on Republicans, whom they accused of being too cozy with large oil companies and too eager to pass out tax breaks to them. They described the rebate as a meaningless gesture, arguing that it would wind up in oil company coffers anyway since consumers would use it to buy gasoline.

"It is disappointing that neither skyrocketing gas prices nor obscene oil company profits can break the bond between Bush Republicans and Big Oil," said Reid.

Experts say few of the measures under discussion on Capitol Hill would have much effect on prices, which have risen above $3 a gallon in many parts of the country.

"Unfortunately, there's nothing, really, that can be done that's going to affect energy prices or gasoline prices in the very short run," Federal Reserve Chairman Ben Bernanke told lawmakers at a hearing yesterday.

But with elections coming in November, lawmakers appeared undeterred.

"There is no silver bullet," said Majority Leader Sen. Bill Frist, a Tennessee Republican. "There is nothing - nothing we can do that can compensate for the fact that today we're 60 percent dependent on foreign sources of oil. But we can put forth a bold agenda."

Meanwhile, the world's largest publicly traded oil company, ExxonMobil, reported first-quarter profits of $8.4 billion, up 7 percent from the first three months of 2005, but well short of Wall Street expectations. Company officials said a combination of factors reduced earnings, including lower fuel production because of refinery maintenance, higher taxes, and higher costs from oil and natural gas production.

Spokesman Ken Cohen, acknowledging the furor surrounding the industry and high gas prices, urged critics to "take a deep breath." He said ExxonMobil has no control over the recent high crude oil and gasoline prices, which are the result of the worldwide market forces of supply and demand.

Maura Reynolds writes for the Los Angles Times. The Associated Press contributed to this article.

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