Date: 1981-04-08
Speaker: ROBERT C. BYRD (democrat)
Chamber: S

Mr. President. in the last several days we have heard a great deal of talk about fighting inflation. The vote on the reconciliation resolution. and the several amendments which were offered to it. were characterized as the first opportunity to demonstrate our commitment to reducing Government spending and restoring economic growth. As Democrats. there should be no doubt that we support the Presidents goals and intend to abide .y the overall budget cut target outlined in the Presidents economic recovery program. However. the presumption that big Government is the only cause of inflation is simplistic and shortsighted. One need only look at the latest report of the Consumer Price Index to see the fallacy of that presumption. The Consumer Price Index rose 1 percent during the month of February. This is an annual rate of 12 percent. Soaring energy prices fueled this rise. Without the energy price increases. the CPI would have risen only threetenths of 1 percent. Prices for gasoline. fuel oil. and utilities skyrocketed in the wake of President Reagans decision to accelerate the decontrol of domestic crude oil and gasoline. The cost of gasoline rose by an average of 8.4 cents per gallon and heating oil by about the same amount. Last week. the March report of the producer price index was released and the story was much the same. Large increases in the prices of petroleum products pushed up the producer price index by 1.3 percent. to an annual rate of 16.8 percent. Outside of the energy area. only a moderate increase was registered. . During the next several months. these higher energy costs will permeate the economy. forcing the cost of food and every manufactured article to rise. All these price increases as reflected in the CPI and the producer price index will. of course. add to the cost of Government. Higher energy prices will. among other things. translate into higher social security and retirement benefits and other indexed Government payments. Those who blame the size of Government for all our economic troubles are really missing the point. Energy prices. which have soared by a staggering 1.200 percent since 1974. have greatly Inflated the costs of Government. particularly the "social safety net" programs. and have been onle of the most obvious causes of the economic stagnation which now grips our Nation. There is unquestionably a need to reduce the growth of Government and the size of the Federal budget. But cuts should not be made at the expense of programs designed to free us from our dangerous dependence on insecure sources of foreign oil. The administration is evidently convinced that America can produce its way out of its energy problemsthat enough oil and natural gas will be discovered to end our dependence on the Persian Gulf. Based on that assumption. the administrations budget drastically cuts every alternative fuel research and development program and most conservation and strategic planning activities as well. Almost total reIlance is placed on the socalled "free market" to develop synthetic fuels. The free market is supposed to equitably distribute gasoline supplies in the event of a severe shortage. Market forcesin other words. high pricesare viewed as the primary motivation for energy conservation. The administrations reliance on as yet undiscovered sources of domestic oil and natural gas Is misplaced and dangerous to our economic and national security. There is no substantiation for the claim that America can produce its way out of this crisis. To the contrary. every credible study indicates that the United States will be lucky to maintain current production levels over the next decade. The more likely scenario is a significant decline in domestic production. requiring. continued dependence on OPEC oil. There is no domestic oil solution to the problem of oil imports. which will cost the United States no less than $80 billion this year alone. Any real hope for achieving energy security rests on other energy sourcescoal. oil shale. biomass. alcohol fuels. solar. and other renewables and conservation. Every reasonable effort must be made to substitute alternative energy resources for liquid petroleum products. We cannot assume that individuals and businesses will move quickly enough on their own to meet this need. While realistic energy prices will encourage some conservation and production. it has been the judgment of Democrats and Republicans alike that additional incentives are necessary if the promise of Americas abundant energy resources is to be reallzed in the near term. The Reagan energy budget would dismantle the comprehensive energy program which was enacted. with overwhelming bipartisan support. by the 95th and 96th Congresses. Under the administrations proposals. all fossil energy demonstration projects. would be terminated at the Department of Energy and would be left to compete for funding by the Synthetic Fuels Corporationwhere the administation has delayed naming a new chairman and board of directors. Outlays for fossil energy research. including all coalrelated research conducted by the Assistant Secretary for Fossil Energy. would be sharply reducedby $300 million in fiscal year 1981 and by $1.2 billion in fiscal year 1982. The entire alcohol fuels and biombss program would be eliminated. Solar energy research would be halved. Research into superefficient batteries. which could lead to the production of a practical electric car. would be terminated. Standby oil allocation plans would be withdrawn. Funding for energysaving measures to be activated by State and local governments in the event of an energy emergency would be terminated. The gasoline rationing apparatus would be discarded. with no program to replace it. Mr. President. this is not a viable energy programthis is a program for disaster. These cuts. both in energy research and supply and in energy conservation. would have the effect of destroying the national energy policy which was put in place during the last two Congresses. Continued reliance on insecure supplies of imported oilwhich is the only policy incorporated in the administration proposalswill Jeopardize our national security. constrain the independence of U.S. foreign policy. and throttle economic growth. That should hardly be the result of a sweeping program that is being presented to the Nation as a way to promote economi. recovery.