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GOP Offers Consumer Fuel-Relief Package

It includes a $100 rebate, but its Arctic drilling component will probably doom it. Democrats' proposals are expected to fare no better.

April 28, 2006|Maura Reynolds | Times Staff Writer

WASHINGTON — Fearing public ire over rising gasoline prices, Republicans on Thursday unveiled a series of proposals aimed at giving consumers some relief, including a $100 rebate.

Democrats derided the GOP plan, and its political chances appeared weak.

The Democrats said that although the package incorporated some ideas they already had introduced, it contained a provision that almost assuredly would torpedo its passage: opening the Arctic National Wildlife Refuge to oil and gas drilling, a measure that repeatedly has stalled in Congress.

"Joining a rebate for consumers with [the drilling proposal] is not, I believe, a sincere effort," said Sen. Debbie Stabenow (D-Mich.).

Emotion over fuel costs ran high on Capitol Hill, illustrated by a five-hour filibuster staged by Sen. Ron Wyden (D-Ore.). He refused to leave the Senate floor in an effort -- ultimately unsuccessful -- to press for a vote on forcing oil companies to pay more to the government for the right to drill for oil on public land. Some of that drilling is exempt from payments.

"Government subsidies may be needed when the price is low, when we have to simulate production," Wyden said. But such relief is uncalled for "at a time when prices are soaring to record-high levels."

By the end of the day, the two parties essentially played to a draw -- neither the rebate idea nor Democratic proposals, which include a moratorium on federal gasoline taxes, appeared to have much chance of becoming law.

But the theatrics made clear that each party wanted to demonstrate its sensitivity to rising prices -- and wanted to direct public anger toward the opposing camp.

At an outdoor news conference with the Capitol dome as a backdrop, Republicans blamed the price surge on Democrats, who they said had blocked measures to increase oil production, such as drilling in the Arctic.

"Those who stand up and criticize ... and suggest that somehow or another that the blame [for gasoline costs] 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 (R-Pa.), chairman of a GOP task force that drew up the party's proposals. "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, who they accused of being too cozy with large oil companies and too eager to pass out tax breaks to them. They dismissed the rebate as a meaningless gesture, arguing it would wind up in oil company coffers because 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 Senate Minority Leader Harry Reid (D-Nev.).

The back-and-forth in Washington came as the world's largest publicly traded oil company, Exxon Mobil, reported first-quarter profits of $8.4 billion, up 7% from the first three months of 2005.

The increase fell short of Wall Street expectations. But the report accelerated the criticism of oil companies from politicians.

"Quarter after quarter, oil companies post unheard-of profits at the expense of farms, businesses and family budgets," said Sen. Maria Cantwell (D-Wash.).

"We need to figure out what's behind these prices and work together to put stronger consumer protections on the books."

The high gasoline prices -- above $3 a gallon in some regions of the country -- result from a confluence of forces that have constricted supply. Experts say few measures under discussion on Capitol Hill would have much effect.

"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 S. Bernanke told lawmakers at a hearing Thursday.

But with elections coming in November, lawmakers appeared undeterred.

"There is no silver bullet," said Senate Majority Leader Bill Frist (R-Tenn.). "There is nothing, nothing we can do that can compensate for the fact that today we're 60% dependent on foreign sources of oil. But we can put forth a bold agenda."

Under the Republican plan, a $100 rebate would be sent to taxpayers making less than $125,000 a year.

Stabenow has proposed a $500 rebate, which she said would cover the average cost of higher gas prices for most families.

The GOP package also called for:

* A summer suspension of the 18.4-cent-per-gallon federal retail gasoline tax, to be paid for by ending some oil industry tax breaks. Sen. Robert Menendez (D-N.J.) previously proposed a 60-day gas-tax holiday.

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