Bush Calls for End to Offshore Drilling Ban; Candidates' Energy Plans
TOM FOREMAN, HOST: With $4 a gallon gas, Americans are driving less -- about 30 billion miles less in the past six months alone. And they're buying more fuel efficient cars. Some are suggesting SUVs could go the way of the Edsel. So what are politicians doing to help? Well, they're really not doing anything right now, but they sure are talking about it.</s>FOREMAN (voice-over): As a wildcat driller, George W. Bush never struck big oil in Texas But this week, he was not giving up. This time, prospecting for black gold in the White House rose garden.</s>GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We should expand American oil production by increasing access to the outer continental shelf.</s>FOREMAN: The president's solution to America's energy crisis is simple, drill offshore, drill in the Alaskan wilderness, squeeze oil from shale in the Rocky Mountains, ask OPEC to increase its output, and build more refineries.</s>BUSH: Congressional leaders leave for the Fourth of July recess without taking action. They will need to explain why $4 a gallon gasoline is not enough incentive for them to act.</s>FOREMAN: To make it clear, if the Democrats in Congress don't immediately fix a problem that's been decades in the making, it's all their fault. Democrats fought back.</s>REP. NANCY PELOSI (D), HOUSE SPEAKER: Two oil men in the White House, they put together an energy policy that drives up the price of oil to $4 a gallon. And now they're saying you're going to have to drill your way out.</s>BARACK OBAMA (D), PRESIDENTIAL CANDIDATE: There's no way that allowing offshore drilling would lower gas prices right now. At best, you're looking at five years or more down the road.</s>FOREMAN: But oil is a burning issue in this election year, so much so that GOP candidate John McCain reversed his direction on offshore drilling. He once opposed it. Now...</s>JOHN MCCAIN (R), PRESIDENTIAL CANDIDATE: I believe it is time for the federal government to lift these restrictions and to put our own reserves to use.</s>FOREMAN: And he blasted his opponent's plan for more efficient cars and tax incentives to drive down gas prices.</s>MCCAIN: That was President Jimmy Carter's big idea, too. And a lot of good it did us.</s>FOREMAN: But Barack Obama has a full tank for this election fight and is hitting back hard.</s>OBAMA: Senator McCain wants to give billions of dollars in tax breaks to big oil and opposes a windfall profit tax on oil companies like Exxon to help families struggling with high energy costs.</s>FOREMAN: If only we could run our cars on high-octane political rhetoric. So as promised, what is a stud duck? A stud duck is the lead rough neck on an oil rig. Of course, and when it comes to bad news and the economy, CNN's stud duck is senior business correspondent Ali Velshi, who joins us from New York today. And with me in Washington, senior political correspondent Candy Crowley. Candy, let me start with you. It seems like what's happening really is a giant political philosophical argument. Everybody knows we are an oil economy, but we have to change. And one side is saying the change is most important. And the other side is the stability and what we have is most important.</s>CANDY CROWLEY, CNN CORRESPONDENT: And this age old argument. I mean, this a Democratic/Republican argument that has been going on every time there's an energy crisis. So what happens, of course, is that it all gets stalemated up on the Hill. But you have on the one hand, Barack Obama, who is emphasizing alternative energies, who is saying to meet the immediate crisis, we need to pump another $50 billion in the stimulus package so that people will have more money in their pockets. John McCain saying let's do more offshore drilling. So it's a production versus a changing way of life sort of argument. Now each have elements of the other.</s>FOREMAN: But neither one has any real new elements from what they've done in the past.</s>CROWLEY: No. No, no, absolutely not. That's why I say this is an old argument on a new problem. The only real immediate issue that they're arguing is that gas tax vacation. John McCain wants it. Barack Obama doesn't. But you know, by January, who knows? It's really more a political argument than anything realistic.</s>FOREMAN: Yes, and Ali Velshi, you point out the gas tax vacation really wouldn't make much difference to most people.</s>ALI VELSHI, CNN CORRESPONDENT: Eighteen cents a gallon. It's a political football right now. It doesn't really matter. What we have to understand is that there's no short-term fix for oil prices or gas prices. What's the long term fix? Congressman Randy Forbes from Virginia came out this week with what he calls a new Manhattan Project. And it's sort of a growing way of thinking that a lot of people are saying the way we tackle energy is to tackle it really big. The way we had a Manhattan Project, the way we had a race to space. The idea that we put a lot of the best minds in the country and a lot of money and incentives to not talking about increasing fuel efficiency by a few miles a gallon, but getting to 70 miles a gallon. Figuring out more nuclear energy, figuring out real alternatives, really using bio fuels.</s>FOREMAN: Doesn't...</s>VELSHI: We need a big think on this.</s>FOREMAN: Ali, those are really interesting ideas, but Candy, I guess the question always in Washington, is there any real political appetite for that? I could see people on both sides of the aisle saying, yes, that's what we need but can that get any traction?</s>CROWLEY: I tell you, not if $4 a gallon gasoline goes back down. I mean, what is driving this new energy discussion is home heating oil...</s>FOREMAN: Right.</s>CROWLEY: ...air conditioning and the gas prices. So if there is that immediate problem, then absolutely, you know, that's the fire that they need.</s>FOREMAN: And this is not true in politics, but in market, too, right, Ali?</s>VELSHI: That's the biggest fear that a lot of people who see change. The argument for change is that if we go down to even to $100 a barrel for gas and $3.00 a gallon for -- $100 a barrel for oil and $3 a gallon for gas, that appetite will disappear very quickly. Why is it now all of a sudden now in 2008 every third person on Capitol Hill has a solution to energy? Because it's an election year. And gas prices and oil prices are very high. This is the stimulus for change is these prices.</s>FOREMAN: I want to look at the various plans that are being offered here, just in a sketch generally. George Bush's energy plan, lift the ban on offshore drilling of the outer continental shelf, expand production of oil shale, enhance and expand refining capacity, expedite refining permission process, get more refineries online basically. John McCain's plan, very similar to a lot of that. But he adds in the idea of suspending the federal gas tax for summer and encouraging more nuclear power. That's one of his alternatives. And Obama's energy plan, he wants to continue the ban on offshore drilling, oppose the gas tax holiday, double fuel efficiency standards to 50 miles per gallon, and support windfall profits tax on oil companies to help those low income families with energy bills, as you mentioned, Candy. When you look at these three plans and you listen to what Ali was talking about there, do you think that there is a growing consensus in Washington that if we're ever going to address our energy problems, we have to get it somehow separated from the explosive nature of month- to-month politics?</s>CROWLEY: Oh, absolutely. I mean, I think you hear that in the Randy Forbes that Ali just mentioned. And that is there has to be fundamental change in both how people live, but also in how we approach energy. I mean, you're hearing people talk again about nuclear energy. The idea of drilling offshore 30 years ago, post new safety mechanisms on oil rigs, pre $4 a gallon gasoline sounded worse to a lot of people than it does right now. So it may be old solutions, but it's in a new environment. And you have people that are now looking at things they wouldn't have looked at before. So maybe somewhere in there is a consensus. It's certainly not going to come this year.</s>FOREMAN: Ali, one of the interesting proposals I heard some time ago was the idea that somebody said if you took the increase in gas that we're all paying now...</s>VELSHI: Yes.</s>FOREMAN: ...compared to five years ago, and five years ago you had said we're going to increase a tax on gas that much...</s>VELSHI: Right.</s>FOREMAN: ...and spend all of that money on alternatives that we would be five years closer to real alternatives.</s>VELSHI: Yes.</s>FOREMAN: Is that just pipe dreaming or would that be true?</s>VELSHI: No, it really is true, unfortunately. And I know there are a lot of people who would say you're not really suggesting more taxes on anything. But the fact is we were paying so much less for gasoline, we could have built other alternatives. At some point, that pain is going to be there and we've got to figure out a way to deal with it. The bottom line is if we start to see a pullback in gas and oil prices too quickly, we'll all rest and say, it's OK and we'll be back in this pickle before we know it again. We are not producing enough oil to meet demand in China, Brazil, India, Russia and the Middle East. We just can't make up for it. We've got to change how much we consume. Remember, this is not about more oil. It's about changing our reliance on oil.</s>FOREMAN: So Candy, the last question goes to you here. This is all wonderful to talk about these grand plans, but the fact is someone has to get elected this fall.</s>CROWLEY: Absolutely.</s>FOREMAN: And in selling the message to the voters, will any of those grand plans sell or is it going to come down to somebody saying, I can convince you that a year from now, you won't be paying $4 a gallon and vote for me?</s>CROWLEY: You know, in the end, it comes down to voters thinking who's going to get it done. And it really - I mean, elections are on broad themes. They're not on, should we drill, you know, on the shelf?</s>FOREMAN: It goes a long...</s>CROWLEY: It's not about - yes, exactly. Those are long-term solutions. The summer gas tax holiday goes away. So it's going to be more what is this person about? Does he generally go in this direction? It's really in the end not about the specifics.</s>FOREMAN: And I generally think he'll keep my car going for a reasonable price.</s>CROWLEY: Yes.</s>FOREMAN: Candy, Ali, thanks both for being here. The rest of you, stay right where you are. We're going to examine the real choices the next president will face on the difficult issues of war and peace. We'll tell you about the perks politicians enjoy that you do not. And we'll talk about why turning down almost $85 million could be a good idea. And finally, our top five presidential campaign slogans will be coming up. Stick with us.