Peter DeFazio

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Chairman, I am attempting here to craft what I would see as a reasonable compromise on the contentious issue of the continued authorization of the so-called Recreation Fee Demonstration Program without any consideration, without one moment's consideration, by the authorizing committee on which I sit. Now, this is a tax on the American people, plain and simple. We all agree that for years we have been charging to access parks, to access developed camp grounds, special fee use areas; those things have ongoing maintenance costs that are directly attributable to the users. There is no issue over that and my amendment does not touch that authority. However, the special new authority in the Recreation Fee Demonstration Program allows the United States Forest Service and the Bureau of Land Management to charge people to drive on Forest Service logging roads paid for by tax dollars to roadside areas, pull-offs, or the end of the road and have to pay a fee to do that. Now, I represent many communities that are surrounded by national forests and for the people in those communities to recreate, they have to buy a pass to go out and hunt or picnic with their kids, drive the roads and park the car if they want to get out. Now, that is by any measure a tax on Americans, on average Americans who use our public lands. We essentially have created a new king's domain here: you can use the lands if you pay your fee. Now, the rationale is we do not have enough money in the budget to pay for recreation use on these lands, even though these people may not be incurring any costs since they are using already developed Forest Service roads, turnouts, parking areas, whatever. These are already there; they do not require any maintenance that is paid for out of this program. So the question becomes, should we continue to assess this fee without having a deliberation and a consideration. Now, on October 1 of this year, the GAO will render a new, updated report on the Recreation Fee Demo Program. I believe that that will point to a direction for some changes that are sorely needed. It will also point out how the money is being spent or has been spent. In their first report, we find out that it generated $31.9 million on Forest Service lands. It cost almost $5 billion to collect that $31.9 million, so 18 percent of the revenue went to collection on the Forest Service, 18 percent went to administration over and above that. For the whole program, 21 percent went to collection costs. In addition to that, there is a general fund appropriation to subsidize the collection costs of $1.5 million, not a very efficient way to raise funds and, obviously, a very small amount of money, a tiny fraction of many of the giveaways in the recent tax bill. So the question would be, why are we assessing this tax on tens of thousands of individual Americans, many of modest means, many of whom will be eligible for nothing in the tax bill because their incomes are so low, they are retired, they are not paying Federal income taxes; they may only be paying FICA taxes if they are still working, they are going to have to pay more than they are going to get back because we are saying we cannot afford to pay for these services. So the compromise I offer is, since the then-subcommittee chairman, the now full committee chairman assured me 2 years ago when I did not ask for a recorded vote on this amendment that it would go through the proper authorizing process. It would actually have, God forbid, hearings; we would actually, God forbid, invite in the public; we might even go to some of the areas affected and hold a hearing, although that might be going a little far, and then we would actually act to authorize any future extension in the shape of this program and the levying of this tax on the American people. This bill, without a single hearing, without a moment's hearing, will extend it for 4 years. My compromise would be to extend it for 1 year, receive the GAO report, and give the authorizing committee the opportunity to hold hearings and mark up a proper authorization. If we want a long-term authorization, I believe it should go through the authorizing committee and the proper process. If the committee cannot accept that amendment, we will then move on to my amendment to strike this provision all together. But in the interests of comity and time of the body, I would be willing, after we hear from at least one other speaker in support, to offer this as a compromise. If the committee is unwilling to accept it, we will then proceed to the debate and a recorded vote on a total repeal of this program.

Mr. DeFAZIO. Mr. Chairman, I offer an amendment.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Chairman, interesting debate; but let us talk about the facts. What the gentlewoman's amendment would do is return us to the system that prevailed in this country for two-thirds of the last century, through the Great Depression, World War II, the oil crisis, and made us the greatest industrial power on Earth. It is cost-based rates, and it goes to every individual generator, unlike the gentleman from California (Mr. Ose) who said this would encourage inefficiency and the dirty plants would operate first and everybody would pay the price. No, that is what the Bush Federal Energy Regulatory Commission did. They said the price will be based on the least-efficient plant, and the most-efficient plant will get that price. So the gentleman from California (Mr. Ose), now knowing the facts, I am certain, will support the gentlewoman's amendment. The FERC also found in December that the prices were not just and reasonable. They were violating Federal law. And since that time, we have found wholesale prices 10 times that of 2 years ago. We found Texas-based energy conglomerates whose profits are up 1,000 percent in 1 year. The price of energy has gone from $7 billion to $27 billion in California in 1 year, and that is spreading up into the Pacific Northwest. Mr. Chairman, the market does not exist. It is being manipulated. There is more and more evidence coming to prove that point. The FERC, by adopting a half-baked proposal, admitted that. It is intervening in a dysfunctional market because of market manipulation and price gouging, but what they have done does not solve the problem. We need to return to a system of cost-based energy which served our Nation so well for two-thirds of a century. We need full refunds, not the partial, maybe refunds that FERC mandated; and we need something that goes for two seasons in California and two seasons in the Pacific Northwest, not two seasons in California and one season in the Pacific Northwest. Mr. Chairman, we heard the administration is doing everything. They are doing everything but offending the very powerful and generous contributors who are making money hand over fist from consumers who are experiencing price gouging.

Mr. DeFAZIO. Mr. Chairman, I demand a recorded vote.

Mr. DeFAZIO. Mr. Chairman, like many of my colleagues, I am concerned about the readiness of our Nation's military and the quality of life for our men and women in uniform. So of this long list just read, I have no objections; but I do have an objection to something that is buried deep within line 23 of this bill. As John Donnelly, who I had to find out about this from the private sector, exposed in a recent ``Defense Week'' article, hidden in this line item under ``contractor logistic support'' is $24.5 million for a fleet of luxury jets for generals and admirals. We know there is a very large fleet. In fact, the GAO, through two reports since 1994, has criticized the size of the fleet for far exceeding the wartime requirements, let alone the peacetime requirements, of the generals and admirals at the Pentagon; excessively expensive and excessively large. Last year, over the objections of the civilians at the Pentagon, a number of generals and admirals requested, and Congress delivered, behind closed doors, eight new jets, 737s, and the special long-range Gulf Streams. That was just last year. Now suddenly this money is specifically for the eight new jets, not for some of the aging huge fleet the GAO says should be downsized. Perhaps if they did that, they would have the money to maintain the eight new luxury jets for the generals, but this $24.5 million is a specified earmark for the new jets that the Pentagon civilians did not request to add to a fleet that the GAO says is excessively large. I do not understand how it could cost that much money for new planes, particularly for the few months remaining in this year. I would assume this is not an emergency, unless they do not have money to stock the wet bars or something is wrong in the luxury galleys and they have to upgrade to Jennaire or something like that. I am not quite sure why it is we suddenly need $24.5 million for eight generals and admirals' luxury jets that the Pentagon civilians did not even ask for, that Congress gave them. If they do not have enough money in this special fleet budget, then they should retire some of the aging high-cost aircraft that the GAO says are superfluous to the wartime needs, let alone the peacetime needs. I am not aware that we are currently at war anywhere in the world, although we certainly do have some extensive deployments overseas, of which I have been critical. This line item is not an emergency. There are dozens of things in this bill on which the money could be better spent or if we chose not to spend the money we could save it to help bolster up our quickly shrinking surplus so we can move through the regular appropriations process here in the House of Representatives, without slashing domestic programs and things that the American people want to see funded. So I suggest to my colleagues strongly that in a budget of $300 billion the Pentagon can find $24.5 million for these new luxury jets to outfit them or do whatever else is necessary, or maybe they are going to wait until next year to use them and ask for the money in their regular budget, or maybe they need to retire some obsolete aircraft from this oversized fleet. One way or another, this is an expenditure that should not go forward, particularly stealth, an amendment hidden deep in the bill and only discovered by one very diligent reporter who ferreted this out and got some folks at the Pentagon to fess up. Mr. Chairman, I would urge strongly that my colleagues support this amendment.

Mr. DeFAZIO. Mr. Chairman, I offer an amendment.

Mr. DeFAZIO. I yield to the gentleman from Florida.

Mr. DeFAZIO. Mr. Chairman, the gentleman from Alabama said it is not the fault of the Congress. It is the fault of the Congress. It was the 1992 Energy Act, which I opposed, which brought about and enabled the State of California to deregulate and brought about Federal deregulation of wholesale power transmission and generation. It is the fault of the Congress. They say it is not the fault of the administration. It is the fault of the administration. The buck stops there. The President has appointed a majority of the Federal Energy Regulatory Commission. He appointed the Chair of the Federal Energy Regulatory Commission, who would not do anything, even though his own staff had said they are violating the law, the prices are unjust and unreasonable. So there is plenty of blame to go around on the Federal level. There should be Federal support to solve this problem. It involves Federal power agencies. The gentleman from another part of the country, he is familiar with TVA. That is a Federal agency. We have WAPA, we have EPA, we have other Federal agencies involved in power transmission in the West. They need funds to enhance that transmission to get us out of this problem and more efficiently use the power west-wide. What are the jerks at FERC doing? They are proposing a market-based congestion management pricing system which will give us a California every day on the transmission system.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, 6 months ago the staff of the Federal Energy Regulatory Commission found that the prices being charged for power in the western United States were neither just nor reasonable. The law would require the Federal Energy Regulatory Commission to then take action to both lower the prices and to order rebates for market manipulation, price-gouging, price-fixing that was going on. But under the leadership of Mr. Hebert, chair of the Federal Energy Regulatory Commission, appointed by President Bush, FERC did nothing. They said there was not really a problem, this was just the market sending us a signal. What was the signal? Billions of dollars extracted from ratepayers, residential ratepayers, small business and big businesses alike; rolling blackouts and brownouts in California; incredibly high wholesale prices in the Pacific Northwest, with prices up to one hundred times, one hundred times what was charged just 2 years ago in the wholesale market. But it also meant up to 1,000 percent, a 1,000 percent increase in profits for a handful of energy companies, most of whom happened to be based in Texas, and most of whom happened to be very generous contributors both to this administration and to the majority party in this House. Mr. Hebert said no action was necessary, that he would do nothing. At one meeting, he opined that he would pray for us; faith-based regulation, I guess. But something changed all of a sudden; being stonewalled for months and months; his own staff saying the law was being violated; being sued; being petitioned by Members of Congress, by constituents, businesses desperate for relief. On Monday they held an emergency meeting. What changed? What could have brought that about? Did they finally read their own staff reports, finally recognize the market manipulation? No, what changed is one vote in the United States Senate. Suddenly, there were committees in the Senate with the capability of investigating what was going on, and they scheduled hearings for tomorrow to bring in the Federal Energy Regulatory Commission to have the chairman explain how it is his staff found things to be unjust and unreasonable, but he said that there was no problem. Under that threat, they have adopted some half measures; better than nothing, but not much. They are going to peg prices to the least efficient, the most expensive unit, most obsolete generating unit operating. It is better than what has been going on today, with prices up to $4,000 a megawatt hour. Maybe we will get it down to $200 or $300. That is still ten times what the market provided for just 2 years ago. They will extend it across the entire western United States, which will offer some relief to my part of the country in the Pacific Northwest. They did admit the price-gouging and market manipulation had gone on and that refunds were due, but they set up some sort of voluntary settlement process to try and extract the billions of dollars back from these Texas-based energy conglomerates. That is not going to work. They need to use their authority to order the refunds, and they need to set the amount of the refunds. Then, finally, they said it would only last through a year from next October; that is, two summers for California, two peak seasons, but only one peak season for my part of the country. This will still cost consumers hundreds of millions, ultimately billions of dollars more than they need to pay to have reliable energy in the western U.S. It will still put untold hundreds of millions and billions of dollars into the pockets of market manipulators. It is just that the profits will not be a 1,000 percent increase anymore, it might only be a 200 percent increase or 300 percent increase for those companies based in Texas who have been contributing so generously to the majority party in this administration. But they had to do something, because they might lose their whole scam, their whole game. The heart of it is deregulation. Deregulation does not work in a monopoly environment. It does not work when there are a few plants and one big set of transmission wires that runs down to smaller wires that run to our house. How are we going to have competition? Competition could never work, will never work in this industry. It is a vital public necessity. For more than 60 years we regulated in this country because of the collapse the last time we played with deregulation in the United States, back in the 1920s. It is time to return to regulation. But short of that, it is time for effective cost-based caps on power, something that runs for 2 years and something that orders that rebates be done. We should not accept in this House these half-measures by the Federal Energy Regulatory Commission in their desperate attempt to save themselves from being embarrassed in having to testify before the United States Senate.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, after pushing through President Bush's budget cuts cutting energy conservation by 21 percent and renewable energy by 35 percent, fighting tooth and nail against reasonable controls and Federal regulation of price gouging and market manipulation in the western U.S., offering a so-called energy plan that James Watt wholeheartedly supported, saying, hey, 20 years later, it looks like they dusted off our old work. Well, it might play well in the board rooms of my Republican friends' campaign contributors, with the energy conglomerates, but they know they are losing in the court of public opinion. So somehow they are going to try a new tack, and I quote: ``Congressional Republican leaders have issued dire, albeit private, warnings to the energy industry that they may not be able to block legislation imposing caps on prices or other measures designed to give the Federal Government a greater role in setting rates for wholesale energy, oil or natural gas.'' So the response is spin and advertising. We are offering a real alternative, an alternative that will give relief to the people in the western U.S. from price gouging and market manipulation, an alternative that will give the American people a sustainable, renewable energy future with conservation and renewable resources. This is a stark choice for the American people: hot air or a real energy policy that benefits consumers.

Mr. DeFAZIO

Mr. DeFAZIO. Madam Speaker, I would certainly echo the comments of those that preceded me in the well about the contributions of organized labor to all working people in the United States and join them in supporting their efforts. But I come to talk about a specific sector of the economy and specific workers, that is, people who work in the lumber and wood products industry. Back in the 1980s, the United States Department of Commerce found that Canadian lumber is heavily subsidized. The Reagan, Bush I and the Clinton administrations have all found the Canadian lumber is subsidized. Numerous Canadian sources, including the BC Forest Resources Commission, Canadian Private Wood Owners Association, Maritime Lumber Bureau have also found those subsidies. That is not in question. The subsidies come in three primary forms. The provincial government owns 95 percent of the timberland in Canada and administratively sets the price of timber one-quarter to one-third of its market value. Agreements allow Canadian mills long-term access to timberland in exchange for cutting to subsidize the timber. No matter what the market conditions are, they are required to harvest and process the lumber, and they lose their licenses if they do not do that. Finally, they are really back 50 years ago or more in terms of their environmental practices. They regularly violate principles set by the Canadian national government in terms of streamside buffers; drag logs through the streams and destroy precious salmon habitat. The results of that are being reflected in crashing salmon runs off of Canada and Alaska. In response, in 1996, the United States and Canada negotiated a softwood lumber agreement. Unfortunately, that has expired and negotiations to extend or revise the agreement have not occurred despite the fact that many of us have contacted the current administration and asked them to make this a high priority. We have seen statistics that say a mere 5 percent increase in lumber imports, subsidized lumber imports, from Canada could cost 8,000 jobs in the Pacific Northwest. So we feel this is of the utmost priority. I am introducing legislation tomorrow with the gentleman from Georgia (Mr. Norwood), bipartisan legislation, the Softwood Lumber Fair Competition Act, and I really appreciate the fact that the gentleman from Georgia (Mr. Norwood) has joined me as the chief Republican sponsor. It also will have support and introduction of a number of other Democrats and Republicans from various parts of the United States. If Canada will not do the right thing and come back to the negotiating table and the Bush administration will not take the initiative, then Congress must force the issues through enactment of such measures as the Softwood Lumber Fair Competition Act. Our legislation is based on the import relief provisions of the Steel Revitalization Act, which has 212 bipartisan cosponsors. The legislation requires that the President take necessary steps by imposing quotas, tariff surcharges, negotiate voluntary export restraint agreements or other measures when softwood lumber imports from Canada exceed the average volume imported monthly during the 24-month period preceding December 1995. This will help ensure that the U.S. industry and workers are not harmed by unfair dumping of subsidized Canadian lumber. The job losses and mill closures will accelerate if the United States does not stand up for our working families and demand that Canada trade fairly. With the sluggish U.S. economy, we simply cannot afford to sacrifice more U.S. jobs and U.S. industries to unfair trade by the Canadians. The President has repeatedly assured Congress that his administration will vigorously enforce U.S. trade laws. I was pleased with his recent decision to pursue a Section 201 case on steel dumping. Now it is time for the President to do more on softwood lumber issues. It has been nearly 3 months since the agreement expired, and 3 months since a number of us contacted the administration to tell them how urgent it was that they pursue these negotiations. He needs to bring the Canadians back to the negotiating table and work out an agreement which both sides can live with similar to the 1996 agreement. The choice is clear. Canada needs to come back to the negotiating table with a good faith effort or Congress must take action.

Mr. DeFAZIO

Mr. DeFAZIO. Madam Speaker, to depart a little bit from my energy outrage day to day, where yesterday I revealed that Duke Power had charged $3,800 a megawatt hour last winter in California, 100 times the price of 2 years ago, to point to a little growing problem of dissension on the majority side of the aisle. Republican conference chairman, the gentleman from Oklahoma (Mr. Watts), has called on the Committee on Energy and Commerce to schedule hearings on the volatile prices facing energy consumers. I quote: We need to get answers from energy companies, executives, including producers, suppliers, refiners, transporters, distributors, retailers, with the goals of finding solutions to these price fluctuations and bringing price stability to the public. Unfortunately, he is being overruled. The majority leader, the gentleman from Texas (Mr. Armey), says he is opposed to committee hearings to look at allegations of price gouging, that is a quote, by the energy industry. He says it is cheap political demagoguery. That is another quote. Well, let us look a little bit at the record. Of course the majority leader does represent Texas, and ExxonMobil did see their profits up 102 percent last year. Americans certainly see it at the gas pump every single day where they are being price-gouged. They had $15.9 billion, ``B,'' billion dollars of profit, up 102 percent in one year. But, no, there is nothing to investigate. There is no market manipulation going on here. An increase of profits of 102 percent a year? Why, that is normal. Okay, maybe it is. Let us go and look at the natural gas market. El Paso Energy, also based in Texas, where the majority leader hales from, they had profits of $1.2 billion last year. A relatively small company; only $1.2 billion in profits. Of course, their profits were up 381 percent in 1 year. An awful lot of Americans saw that in their natural gas bills this winter when they were trying to heat their homes and a lot of them were freezing because they could not afford the bills. Nothing to investigate there. There is no market manipulation. It is normal for natural gas prices to go up by that much and for profits for this company to go up by 381 percent a year, except for recent revelations that have shown that El Paso Natural Gas bought pipeline capacity and then refused to use it and refused to let any other gas company use it so they could artificially restrict supply and drive the price up. But there is nothing to investigate there. All right, let us turn then to electricity. Duke Power. I spoke earlier about their charging as much as $3,800 a megawatt hour, 100 times the price of 2 years ago. Just multiply your home electric bill by 100. That is what Duke was charging folks in California this winter. But they only earned $1.8 billion of profits and their profits are only up 109 percent in 1 year. Nothing to investigate there. No. Price of $3,800 a megawatt hour, only up 100 times what it was just 2 years ago, why that is just natural. It is those Californians. They deserve this. Nothing to investigate there. We need a comprehensive investigation. The Bush administration's own Federal Energy Regulatory Commission has found these prices unjust and unreasonable. The staff, unfortunately the chairman is appointed by the President, Mr. Hebert of Louisiana, and the chairman says, like our majority leader from Texas, there is nothing to investigate here. This is just the market at work, and consumers should just lump it. Well, the Republicans are going to lump it at the ballot box unless they follow the advice of their conference chairman and start doing an investigation of what is going on. And if they do not do it here in the House, I predict it will happen in the Senate. And they might just have a little bit of egg on their face here when more and more of this evidence of price gouging and market manipulation comes out. Because the American people know what is happening to them. They know it every day when they pull up to the gas pump and they know it when they are opening their electric bill and when they get their natural gas bill, and they are not going to take it for much longer any more.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, as I speak, down at the White House they are signing the $2 trillion tax bill and champagne corks are popping on Wall Street. What about Main Street? Well, Main Street is getting the bill. Main Street is seeing higher gasoline prices, higher electric bills and natural gas prices. The President said, well, they could use their refund to help pay those costs. They give you some money and you send it to an energy company in Texas. Unfortunately nearly 30 percent of American families will not be getting any of that rebate. Most American families, more than half, pay more in Social Security taxes than they do income taxes. Many of those families will not get a penny of this so-called rebate. Some will get a check for a dollar. It costs the Federal Government 15 bucks to write the check and they will get a buck back. Hey, it buys almost a half a gallon of gas. Good deal. For the most wealthy families in America, this is a day to celebrate the repeal of the estate tax and other things that will benefit them tremendously, but for average Americans, Main Street Americans, it is business as usual in Washington, D.C. They will get the bill, not the check.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, if the gentleman would yield back, they talk about market signals. What is the market signal that Duke Energy and its investors are getting at a price of $3,380 per megawatt hour for electricity, electricity that 2 years ago sold for $30 a megawatt hour. That is \1/120\ times the price. I mean, this is just extraordinary. What is the market signal these folks are getting? How efficient is the plant going to be that they are going to build? What is their long-term look at the market? What about future reliability? Actually in the Northwest, we recently had a company that has what is called a server farm, that is a headquarters for a bunch of systems and companies and others that operate computers, computer servers, they were told, ``Yeah, we've got to admit it's a little problem when we crash the electricity to your server farm. We can understand you would get upset.'' So the local company there said, ``Hey, if you only pay us 400 percent of the current price, we'll guarantee reliability.'' Is this the new wonders of the market that the Bush administration is talking about? If I do not want to have to reprogram everything in my house or have the lights go out when I am not there or have a problem with my heat pump, my defroster in the refrigerator, things melting, the other things that happen, or senior citizens in nursing homes, if we want reliability, by God, you have just got to pay three or four times as much. I do not think so. This works. It worked successfully. We became the greatest industrial Nation on Earth under such a system. I realize people say, ``Oh, you're a socialist, DeFazio. You want government to get into this.'' I say, ``The government was in this.'' What do you think the policy was when the Reagan administration was in office? Regulated utilities when the Reagan administration was in office. We did not have these kinds of problems. This was signed by Bush the senior back in 1992, and it only took 8 years to destroy the western energy supply and grid under national deregulation. It is coming to the rest of the United States soon. People know it. They want us to go back to a system that works. This is too essential to our economy, too essential to our senior citizens, too essential to small businesses and residential ratepayers. We cannot have something that is unreliable and plagued with price spikes or blackmail, where they say, ``Look, if you don't want your lights to go out, just pay me five times your bill.'' Gee, I guess I would only have to pay up from $170, if I would be willing to pay $850 for my electric bill in a winter month, they would guarantee that my lights would stay on. Is that not great? This is sure a functional market. And the Federal Energy Regulatory Commission, the chairman appointed by George Bush, Jr., unlike George Bush, Sr., who brought about this system, is saying there is nothing wrong, he is not going to do anything about it. He is defying and suppressing his staff. Hopefully the changes that have come about on the other side of the Hill will bring some investigation and subpoena into this where we get some of the professional staff to come in or we get even Commissioner Massey to come in and tell us what is really going on at FERC, which is that they are there for the profits. As long as they can milk this for the Reliants, the Dynergys, the Entergys, the Enrons, the Dukes and all these other predatory new energy companies, they are going to do it because they are major contributors to this administration and to the majority party in this House and, by God, they are not going to do anything to hurt their profits and Joe Barton was making sure of that and that is why he killed that bill. They did not want a vote on price caps because they are afraid it might win.

Mr. DeFAZIO. Mr. Speaker, this administration says if we put in a price cap it will make things worse. Absolutely to the contrary. In Oregon, Washington, and California, people are building and proposing the construction of plants as quick as possible. Westinghouse is years out on generation. We are building them. We are also having a drought. That compounds the problem. Mr. Speaker, actually the inverse would happen. If you had a price cap, there would be more energy available because right now what we have is people gaming the system to try to drive the price as high as possible because they think if I shut down part of my generator, I can drive the price up, only operate part of the plant and still make more money. But if you set a cap and say you are over that cap, then suddenly we would have more generation. We would not find the withdrawal and the manipulation and the withholding from the market that is causing some of these blackouts and brownouts this summer in California.

Mr. DeFAZIO. Mr. Speaker, if the gentleman would yield, the United States had until the late 1990s, on average the lowest-cost energy in the entire industrial world through a system of regulation. We have quickly gone to a system which is totally unreliable, has blackouts and brownouts, and has price spikes where prices are going up to 100 times the so-called normal price. A 10,000 percent increase. The gentleman referenced earlier these energy companies, these new energy companies, many of whom are based in Texas, are making profits that are up 400, 500, 600 percent in 1 year. You do not get those kinds of profits in 1 year in a normal and functioning market. Something is very wrong here, and what is wrong is the people of California have been on the forefront of people being fleeced under this system, but now they are sticking it to the people in the Northwest; and it will come to other parts of the country. Mr. Speaker, under deregulation in New England, Pacific Gas & Electric of California, which says they are broke, sent billions of dollars to the mother company, Pacific Gas & Electric of America, whatever it is called, who sent the money to Pacific Gas & Electric of New England, who now is one of the larger owners of plants in New England. And since they deregulated New England and since Pacific Gas & Electric bought plants in New England, the same one that says that they are broke in California, reliability, they are having the same kind of outage problems. The plants are not available, and the price goes up. This is becoming a nationwide phenomenon.

Mr. DeFAZIO. Mr. Speaker, before the missteps of deregulation, the United States of America throughout the 20th century, basically from the time we regulated energy after 1932, through 1992 when Congress, in a little-noticed action buried in a so-called energy-efficiency bill allowed deregulation to go forward. During that time the words blackout, brownout, price spikes, price gouging, these were not part of our electrical energy vocabulary. Now in 8 short years, the wonders of a so-called deregulated market have delivered that. They have delivered that not only because the concept itself is faulty, and something that is inherently monopolistic or oligopolistic, but also because of the active encouragement and inattention at best by the Bush administration. There are still laws on the books, the gentleman would not believe it, there are laws on the books that require that the Federal Energy Regulatory Commission determine whether prices will be based on cost or market- based. They are not supposed to be market-based where markets do not exist. Clearly there is no effective market in the western United States. It is not only California that is suffering these outrages. It is also Oregon, Washington, and other western States. There is no effective market. The Federal Energy Regulatory Commission, their own economists, their own staff found in December that prices were unjust and unreasonable, but the chairman, a Mr. Hebert from Louisiana, a former staffer to the former recently deposed majority leader of the Senate, is refusing to do anything about it. The mantra from the Bush administration is price caps are bad. They do not work. They are right, if we have a functioning market where one has the normal laws of supply and demand, price caps are not a good idea. Energy is unique. It requires that you have a 10-15 percent reserve margin at all times to have reliability. There are very few sellers. There are very limited ways of delivering that energy to your house. Most of us only have one wire that comes into our house. Most businesses only have one wire that comes into their business. There are a couple of routes over higher voltage lines to get to that neighborhood or communities. There are few options. We are not actively buying and selling and chasing after a multiplicity of sellers. This is clearly a manipulated market. One can look at the prices and know it is manipulated. Mr. Speaker, it just came out that the record, so far as we know, is a price charged by Duke Energy Corporation of the Carolinas to California last winter, low-demand period in California when strangely enough about a third of the generation in the State went missing. Just was not available. No one knows where it went because under deregulation, a company does not have to operate their plant. They can say, freeze in the dark, sucker; you are not paying me enough money. That is what deregulation means. There is no longer a duty to serve. Duke Energy, being a benevolent organization, sold energy for only $3,880 per megawatt hour. I tried to figure that out in terms of what it would mean for my electricity bill. I have an energy-efficient house with a heat pump. It is an all-electric home. In my case, it would have meant that my energy bill for 1 month would have exceeded my mortgage by a factor of eight if I had to pay that price individually. That is the outrageous extortionate price that Duke Power, and they are not alone. We have Enron. We have Reliant Company, I believe they are based in Texas, which tied their energy commodity traders, their speculators who produce nothing except profits, to the people running a decrepit plant that they bought in northern California; and as the market went down, they told them to shut down the plant; and when the market went up, they told them to crank it up. They were attempting to directly manipulate the plant, destroying the plant, obviously not providing reliability; but guess what, it is legal. It is legal because the Federal Energy Regulatory Commission says that is not market manipulation, that is not price gouging, that is just fine, according to the Bush Federal Energy Regulatory Commission.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, the outrage of the week in energy is that finally we know how much some of these companies have been charging. During a brief time last winter in a desperate attempt to keep the lights on, California paid $3,880 per megawatt hour to Duke Energy of South Carolina who now owns plants, thanks to deregulation, in California. Of course, they do not feel much of an obligation to keep the lights on. What they are trying to do is maximize profits. Price gouging, it is open season on price gouging in the western United States. Yet, the Bush administration says there is nothing and they will do nothing about this. They will not even investigate whether price gouging is going on. The Federal Energy Regulatory Commission is charged with determining whether or not there is a market, a functional market, and prices are fair and reasonable. The staff of the Federal Energy Regulatory Commission, the staff, the professionals, has found that in fact what is going on in the western United States is not fair; it is not reasonable. But guess what? The chairman, Mr. Hebert of Louisiana says he is just not going to do anything about that. He will pray for us, he has told us, but that is it. Now, this is extraordinary. This is the chairman appointed by President Bush. Now, we might wonder about the motivation. Well, there are others other than Duke Energy involved, and perhaps that is the motivation. Many of these companies that are making profits up to 1000 percent over last year's profits are based in Texas, many in Houston, Texas. Many are very large contributors to the Bush administration. The CEO of one of these energy monoliths, the Enron Company, the chief architect of much of the legislation that has brought about this disaster, has personally, personally, one individual contributed in his lifetime more than $2 million individually, personally, to George Bush as a candidate for many different offices; $2 million. His company, of course, is in for many, many times that but, hey, they make it back in about a minute in these energy markets so it is a really good investment on their part. The same gentleman is now hand picking other people to go on to the Federal Energy Regulatory Commission. So we cannot expect that we are going to see much relief there. So then we turn to the Bush energy plan. Does this offer us relief? Well, I do not think so. If we look at the Bush energy plan, we had Secretary Norton before the Committee on Resources today, it is dig, drill and burn. We are not going to conserve. I asked her, I said if we went into the Alaska National Wildlife Refuge, if we went every place you want to go, if we went to the most sensitive coastal areas off Florida, which I doubt will happen because we have another Bush as governor, but let us say we went to the most sensitive areas off California, who this administration seems to be willing to stick it to every day, and off Oregon and Washington and other parts of the country, and found all the oil, went into Alaska and found all the oil, I said can you envision that we could increase possibly our supply of oil by a factor of ten, that is, instead of having x number of years, 100 years' supply, we would have 1,000 years? She said, oh, no, we would never get there. I said, let us just say you did. Let us just say there is a heck of a lot more oil out there than you thought. People want to talk about we are going to become oil self-sufficient. If we continue to increase our consumption at the current rate, we do not conserve, if we found a thousand-year supply of oil in the United States we would use it up in 79 years; the miracle of compound interest, of compound increasing demand. Conservation has to be a robust part of this plan. But guess what? Conservation does not put profits in the pockets of the oil companies based in Texas and Louisiana and elsewhere, and the new energy companies based in Texas, Louisiana, South Carolina and elsewhere, but price gouging at the gas pump, price gouging in the wholesale electric markets does. So that is the energy future that is being promised in this plan. Now one can turn to Congress. Are we going to get relief out of Congress? Luckily, today the so-called Emergency Energy Relief bill being offered by, strangely enough, the gentleman from Texas (Mr. Barton), backed by the chairman from Louisiana, strangely enough, can I see something going together with this crowd here where they produce this stuff as the people who do not want to do much about it? Their bill finally came crashing down today. That is good, because it would have done nothing for the consumers in the Western United States, nothing for us at all. It would have done nothing to rein in price gouging. They did not want to have to consider a price cap amendment to rein in what has become publicized more and more in recent weeks as outrageous manipulation of the market by some of these energy companies. The Reliant Company, putting their floor traders, their commodity traders, on the phone to the people who actually operate the plants in California; and when the price drops in the national markets, they tell them to shut the plants down. They do not care if the lights stay on. They are just trying to maximize their profits. The American people know this. They know they are having it stuck to them every day at the gas pump. They see the facts, that Exxon-Mobil is the most profitable corporation in the world, with profits of $15 billion last year. They see those prices going up and on and up and know they are being had. This administration is engaging in inaction and stone-walling real relief, at its peril.

Mr. DeFAZIO

Mr. DeFAZIO. Madam Speaker, that was an extraordinary speech by the gentleman from California (Mr. Gary Miller) who preceded me in the well, and I will offer a little different perspective on what is going on in energy in the Western U.S. It is Memorial Day weekend and all across the country Americans and their families are pulling up to the pump and surprise, prices are up, way up. But there is no market manipulation. The deafening silence of the Bush administration and the runup on gas prices might have something to do with who supported their last campaign but I would not allude that on the floor. There is no market manipulation. Exxon Mobil, profits $15.9 billion last year, profits up 102 percent in one year, there is no market manipulation. There is no role for the Federal Government here, except to enable them to drill for more oil and to cut their taxes. That is what the Bush energy plan proposes. Now, the gentleman from California (Mr. Gary Miller), I am very surprised that he did not want to talk about some of these things. Yesterday I talked about Reliant Energy. Reliant Energy, based in Houston, Texas, profits up 1,800 percent in one year; bought a few generating plants in California. It was revealed in the San Francisco Chronicle on Sunday, with interviews with some of their plant operators, that the plant operators were linked by telephone to their commodity trader speculators and the commodity trader speculators watched the charts and when the price of energy went up, they said crank up the plants. When the price of energy went down, they said crank down those plants. They did this on as frequently as 10-minute increments. That destroys the plants, obviously does not provide reliability or keep the lights on for the people in California and the Western United States, but it is incredibly profitable; 1,800 percent runup in profits in one year. But there is no manipulation. The hear no evil, see no evil, speak no evil folks at the Federal Energy Regulatory Commission appointed by President George Bush, Mr. Hebert, the chairman; the Secretary of Energy; the vice president of the United States, they do not think there is any market manipulation or profiteering or price gouging going on here. It is normal for a company to increase its profits by manipulating the market and driving up its profits 1,800 percent one year. Now today in the Los Angeles Times, closer to the gentleman who preceded me, we have, ``Executive tells FERC Hearing of Collusion on Natural Gas.'' Natural gas produced in Texas, El Paso Natural Gas, bought the pipeline capacity to ship gas between Texas and California. It is used for electricity generation and to heat homes and run businesses. Guess what? They bought the capacity but they did not use it, and they would not let anybody else use it so they could drive up the price of energy. There is extraordinary, unbelievable market manipulation, price gouging, going on in the Western United States, which is imperiling the entire economy of the Western U.S., not just California. The Pacific Northwest is at risk, too. We are having a drought and we are paying more in the wholesale energy market than are Californians because of these manipulated prices, because of this unbelievable profiteering. What is the response from the Bush administration? Drill ANWR. Well, we do not use oil to generate electricity. I have said that to the vice president. That does not matter. They want to drill ANWR. Their bosses, Enron, Exxon, Chevron, Reliant, El Paso Natural Gas and others, they want something here. Let us manipulate this. Let us pretend the crisis is caused by, as the gentleman before me said, the environmental rules, and let us pretend that they are not obscenely manipulating the market and profiteering. Blame someone other than those really responsible. That is the agenda of this administration. That is the agenda of their energy policy, and I do not believe that it is going to sell with the American people, and I certainly hope it does not sell here in Congress.

Mr. DeFAZIO

Mr. DeFAZIO. It is past time for the Bush administration to stop supporting the energy companies and support the American people.

Mr. DeFAZIO. And then when the price skyrockets, they turn them back on. They are destroying the plants, they are destroying the economy, and the Bush administration and their hand-picked chair of the Federal Energy Regulatory Commission are refusing to take the actions required under the law to stop unjust and unreasonable price gouging and market manipulation.

Mr. DeFAZIO. Mr. Speaker, the chairman of the Federal Energy Regulatory Commission, hand-picked by President George Bush, Mr. Hebert, has chosen to turn a blind eye toward the price gouging and market manipulation which is enriching a few huge energy companies, several of which happen to be based in Houston, Texas, at the expense of tens of millions of people in the Western United States. It is not only Californians who are suffering. We are paying a higher average price in the wholesale market in Oregon and Washington than they are in California, and it is not necessary. It is manipulated. Let us look at one company, Reliant Power. Profits up by 1,800 percent in one year. Is that not grand, from $27 million to $482 million. But on Sunday, the San Francisco Chronicle revealed that they are blatantly manipulating the market. They have phone lines between their traders and their trade rooms and their plant operators in California, and when the price of energy drops, they shut the plants off and turn the lights out.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, we've spent the day on a very important issue, our children's education. But, the whole picture is not complete. How about the kids who are not prepared for school or are disruptive in class. The kids that, at least, have run-ins with authorities and drop out of school, at most, end up committing violent crimes, sometimes against their own classmates. The safety of our schools continues to be a major concern as evidenced by a CNN/USA Today/Gallup poll in which 43 percent of parents said they fear for their child's safety at school. One in three parents believes that it is ``very likely'' that a Columbine-type shooting could happen in their community. While the number of children hurt by violent crime has declined significantly in the last six years, we can't escape the reality of the shootings at Thurston High, Columbine and most recently in Santee, California. As many of my colleagues know, following the tragic shootings at Thurston High School, I introduced legislation to help combat the growing problem of youth violence in America. The Youth Violence Prevention Package is based on needs identified by my community and is designed to prevent youth from turning to violence by providing adequate crisis intervention and support services. After a decade of record economic growth and decreasing crime rates, America has the opportunity to invest aggressively in proven violence prevention and youth development activities to ensure that children and families are able to thrive. Targeted investment in prevention efforts that give children and families what they need to stay on track works. That's why I'm so disappointed by the priorities set by President Bush and Congress in the budget blueprint. --The Bush budget abandons a commitment made in past budgets to give one million children access to Head Start by fiscal year 2002. Under the Administration's own estimates, the Head Start program will fall 84,000 students short of that goal. The Bush budget actually results in the elimination of Head Start services for 2,500 children. --In addition, the Bush budget reduces resources for existing Child Care and Development Block Grant projects by $200 million. Specifically, my legislation would increase the authorization for Head Start programs to $11.5 billion. And, it would create a national child care provider scholarship program to further the goals, of child care provider recruitment, training, credentialing, and retention. --The Bush budget cuts grants to help states investigate and prevent child abuse and neglect by $16 million--a 47% reduction. Furthermore, most other child welfare service programs are frozen at the fiscal year 2001 level. --Also, general juvenile justice and delinquency prevention grants are cut by $44 million, gang-free schools and communities grants by $6 million, mentoring grants by $7 million, incentive grants for local delinquency prevention by $25 million and drug reduction grants by $12 million. On the other hand, legislation I've introduced would increase authorization for Community Based Family Resources and Support Programs, like Relief Nurseries, by $44 million. In addition, it would increase the authorization for Title V incentive grants for local delinquency programs--like, parent assistance, antitruancy, and court schools. Providing parents with the skills and treatment they need to be better parents is critical. A comprehensive prevention approach that looks at the entire family and identifies the specific needs of the child within that family can reduce the incidence of aggressive and risky behavior that often leads to delinquency. In 1998, there were approximately 1 million confirmed cases of child abuse or neglect. Research indicates that children who experience some form of violence in their homes are more likely to behave violently throughout adolescence and into adulthood. Any comprehensive approach to curb juvenile delinquency and promote positive youth development must consider the impact of domestic violence, abuse, and neglect on a child's development and respond to the interplay between these factors. --The Bush budget slashes discretionary spending on state and local law enforcement assistance by $1 billion. Specifically, funding of the Edward Byrne Memorial state and local law enforcement program is reduced. My package includes legislation that would expand discretionary grants under the Edward Byrne Memorial State and Local Law Enforcement Assistance Program by $31 million. Contrary to popular perception, the vast majority of children involved in the juvenile justice system are non-violent offenders. Less than 10 percent of young people who come in contact with the juvenile justice system are serious, habitual, violent offenders. The challenge with all juvenile offenders--both violent and nonviolent--is to determine what leads children to make bad choices, to identify those children at high risk for serious delinquent or risky behavior, and to provide appropriate interventions. A 1998 study suggests that the lifetime cost associated with a child who drops out of high school and enters the criminal justice system can reach $1.5 million. The Bush budget freezes funds for the 21st Century Community Learning Centers after school program at the fiscal year 2002 level. Furthermore, the Bush budget eliminates a $60 million grant program to the Boys and Girls Clubs of America to operate clubhouses in public housing projects and high-crime areas in cooperation with local police. My legislation would also expand after school crime prevention programs by providing matching grant funds to private and public programs involved in effective after school juvenile crime prevention. According to the U.S. Census Bureau, nearly 7 million children are left home alone after school each week. It has been well-documented that after school programs help to curb delinquent behavior when it most frequently occurs--between the hours of 3 p.m and 6 p.m. However, these programs do more than just make communities safer, they also help to ensure positive youth development. Youths who participate in after- school and youth development programs are less likely to use drugs, drink alcohol, or become sexually active, and are more likely to have stronger interpersonal skills, higher academic achievement, and healthier relationships with others. Quality after-school programs also have a lasting impact on children's attitudes, values, and skills. My Youth Violence Prevention Package is designed to prevent youth from turning to violence by supporting prevention efforts, crisis intervention and support services and limiting opportunities for troubled kids to obtain firearms. I ask my colleagues to support this legislative package and to continue efforts to provide needed funds for these critical programs. We all must work together to protect children and ensure their healthy development.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, I move that the House do now adjourn.

Mr. DeFAZIO

Mr. DeFAZIO. Mr. Speaker, if I can make a quick sentence on the energy policy. What we are putting forward is a really grand 1953 energy policy, dig, drill, burn, build, and profit, profit, profit. I would just reflect, it is time to move beyond that. We have the technology and the capability of becoming the most energy-efficient and most well- fed, housed, clothed and heated Nation on Earth with new technologies. We just need to invest in it. The Stone Age did not end because they ran out of rocks. They evolved. We need to evolve here in the United States of America.