When the House considers H.R. 6, the “Creating Long-Term Energy Alternatives for the Nation Act of 2007” on Thursday, Members will be voting in direct opposition to the goals embodied in the 2005 Energy Policy Act, a broad and laudable attempt to encourage domestic energy production.
By coincidence, the 2005 legislation was also H.R. 6. Introduced in the House on April 18, 2005, the bill was the results of years — YEARS! — of discussion, analysis, debate and negotiations. It enjoyed bipartisan support, with the conference report eventually passing the House on July 28th with a 275-156 vote (Roll Call No. 445.) Seventy-five Democrats joined the 200 Republicans who voted for the bill, which was signed into law on August 8 (text of PL109-58 is here.) In short, it was a serious piece of legislation — — strongly supported by the NAM — that has already paid off in numerous ways, such as encouraging the renaissance of nuclear power.
This year’s H.R. 6? As noted below, unlike the 2005 law, it’s narrow — punishing just “Big Oil” through higher taxes. As a matter of public policy, it’s a bad idea to single out one particular industry for punitive legislation: What investor wants to put his money in an industry that’s whipsawed by politics?
Also, unlike the 2005 bill, the current H.R. 6 is not the product of debate, negotiation or bipartisan compromise, coming to the floor in the first 100 hours of Congress without any public hearings. While giving some Oil Patch Democrats heartburn, the bill will probably pass as a matter of party discipline.
But it certainly won’t encourage energy production. Barry Russell, president of the Independent Petroleum Association of America, dissects the bill, title-by-title, in this release, and makes the salient point:
“If the goal is to lessen our dependence on foreign oil, then this bill falls far short…The American oil and natural gas industry is our most precious and primary defense against increased oil imports. This is a time to encourage American investment in energy projects here at home, not discourage it. This bill takes capital from U.S. oil and natural gas companies that otherwise would be spent on domestic energy exploration.”
If we are repeating ourselves a bit on this topic, it’s because there are few more important to the U.S. manufacturing economy. As primary consumers of energy, manufacturers in the United States have seen their competitive advantage undermined by higher prices, the result of policies that discouraged development of our energy resources. (See the NAM’s 2006 cost study.)
In 2005, H.R. 6 was a major step forward toward an energy policy that fostered “energy security.”
In 2007, H.R. 6 also represents a major step — backwards.
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