Senate Democrats

Reid: Bush-McCain Republicans Say No To Strengthening Economy, Yes To Ignoring Energy Crisis

Washington, DC—Senate Majority Leader Harry Reid made the following statement today after Senate Republicans blocked the Consumer-First Energy Act and the Renewable Energy and Job Creation Act of 2008:

“Bush-McCain Republicans have spent the last two weeks feigning interest in addressing the rising the costs of energy.  This morning, we gave them two more opportunites to actually address it, and again they ran away from the debate and real solutions.

“We gave them another opportunity to invest in renewable energy rather than line the pockets of Big Oil billionaires.  And we gave them the chance to create millions of good-paying green-collar jobs right here at home to combat a Bush-McCain economy that has lost jobs every month of 2008.  But once again, Bush-McCain Republicans have refused to govern, squandering these opportunities the same way they have blocked so many other chances to help struggling Americans.

“They just don’t get it: We can’t drill our way out of this crisis and we can’t ignore it.  Each day Republicans wait to act costs American taxpayers billions of dollars and the opportunity to create millions of good-paying jobs.”


Republicans Again Block Bill Addressing the Root Causes of High Gas Prices

The burden of $4 per gallon gas is hurting American families, workers, and businesses and is being felt throughout our economy. But given the chance to vote on legislation addressing the root causes of high gas prices and investing in renewable fuels to reduce our dependence on oil, Bush-McCain Republicans twice turned their backs and voted no. By obstructing progress on these critical bills, Republicans continue to back President Bush’s failed energy policies of the last seven years that have driven up the price of gas by 177 percent and hurt Americans at the pump. It’s time for Bush-McCain Republicans to stop saying no and to work with Democrats to deal with the root causes of high gas prices.


Gas Reaches Another Record High with a National Average of $4 a Gallon.  “The average price of regular gas crept up to $4 a gallon for the first time over the weekend, passing the once-unthinkable milestone just in time for the peak summer travel season. Prices at the pump are expected to keep climbing, especially after last week’s furious surge in oil prices, which neared $140 a barrel in a record-shattering rally Friday. While Americans who have to drive will feel the biggest squeeze, the increased prices also translate into higher costs for consumers and businesses, who will be forced to shoulder increased costs for food and anything else that needs to be transported.”

[Associated Press, 06/09/08]

  • At February Press Conference, President Bush Was Unaware that Gas Prices Could Reach $4 a Gallon. Asked at a February 2008 press conference what he would tell the average American who was looking at the prospect of $4 per gallon gas, President Bush was surprised. “Wait, what did you just say? You’re predicting $4-a-gallon gasoline?” He added, “That’s interesting. I hadn’t heard that. . . . I know it’s high now.” [President Bush Press Conference, 2/28/08]
  • Gas Was $1.46 When President Bush Took Office, Has Risen 177 Percent on his Watch. When President Bush took office, the cost of a gallon of gas was $1.46. The average price of gasoline on June 10, 2008 was $4.04. Therefore, on President Bush’s watch gas prices have increased 177 percent. [Energy Information Administration; AAA]  

The Average Family is Spending a Record 6% of its Income on Gasoline. “The current drain on consumers’ income from rising fuel prices is greater than it was during most of the worst energy-price run-ups of the past. Spending on fuel as a share of wage income has shot above 6%. That exceeds the percentage seen during the 1974-75 and 1990-91 oil-price shocks and approaches the 7% to 8% seen during the 1980-81 price surge. Comparing the rise in fuel spending to income growth, which has been especially weak in recent years, the current shock is far worse than any of the three prior ones.”

[Wall Street Journal, 06/09/08]


Rural Regions are the Hardest Hit by Rising Gas Prices. “Across broad swaths of the South, Southwest and the upper Great Plains, the combination of low incomes, high gas prices and heavy dependence on pickup trucks and vans is putting an even tighter squeeze on family budgets. Here in the Mississippi Delta, some farm workers are borrowing money from their bosses so they can fill their tanks and get to work. Some are switching jobs for shorter commutes. People are giving up meat so they can buy fuel. Gasoline theft is rising. And drivers are running out of gas more often, leaving their cars by the side of the road until they can scrape together gas money. The disparity between rural America and the rest of the country is a matter of simple home economics. Nationwide, Americans are now spending about 4 percent of their take-home income on gasoline. By contrast, in some counties in the Mississippi Delta, that figure has surpassed 13 percent. As a result, gasoline expenses are rivaling what families spend on food and housing.”

[New York Times, 06/09/08]

West Coast Gasoline Prices Continue to Spiral Upward.  “The price for [gasoline on] the West Coast extended its upward surge, jumping another 13.7 cents to strike 416.6 cents per gallon. West Coast prices have risen 28.3 cents over the past two weeks. The average price in California went up even more, shooting to 424.2 cents per gallon, an increase of 14.3 cents from the previous week.”[Energy Information Administration, 06/04/08]

Gas is Highest in California, and Could Reach $5 a Gallon Soon.  “Californians are still learning to cope with $4 gasoline. Will we soon have to deal with $5? In the two weeks since California’s average price for regular gasoline passed $4 per gallon, prices have jumped an astonishing 42 cents. Some cities have seen increases of five cents or more overnight, according to data from the AAA auto club. San Francisco drivers now pay, on average, $4.42 for a gallon of regular. In Oakland, the average is $4.39. In San Jose, $4.40.” [San Francisco Chronicle, 06/08/08


Continental Airlines Cut 3,000 Jobs Due to High Fuel Costs. “Continental Airlines announced that it will cut 3,000 jobs and retire 67 Boeing aircraft. Similar to other airline carriers, the added expense of jet fuel forced Continental to reduce capacity by 16 percent. Company executives stated that “the airline industry is in a crisis” and added that the industry’s “business model doesn’t work with the current price of fuel and the existing level of capacity in the marketplace. We need to make changes in response.” [New York Times, 06/06/08]

United Airlines Shut Down Discount Carrier and Cut 1,100 Jobs Due to High Fuel Costs. “United Airlines is discontinuing Ted, the low-fare, no-frills division it started in 2004, as part of a broader move to ground aircraft, cut jobs and reduce costs. With jet fuel costing 84 percent more than it did a year ago, major airlines are raising fares and re-examining every feature of their flights, eliminating those they cannot afford. Along with suspending Ted, United said it would remove 100 aircraft from its fleet, including six Boeing 747-400 long-range jets, and 94 Boeing 737 medium-range planes. The airline, which had already announced plans to eliminate 30 of the planes, also said it would lay off up to 1,100 employees, on top of 500 job cuts already announced.”[New York Times, 06/05/08]

General Motors Closed Four Plants Affecting 10,000 Workers Due to High Gas Prices. “General Motors is closing four truck and SUV plants in the U.S., Canada and Mexico, affecting 10,000 workers, as surging fuel prices hasten a dramatic shift to smaller vehicles… The cuts will affect 10,000 hourly and salaried workers. Many will be able to take openings created when 19,000 more U.S. hourly workers leave later this year through early retirement and buyout offers.” [Associated Press, 06/04/08]

Truckers Have Been Hit Especially Hard by High Diesel Prices. “The trucking industry is getting hit especially hard. A report by investment banking firm Avondale Partners LLC said that about 42,000 trucks, or 2.1 percent of the nation’s heavy-duty truck capacity, went out of business in the first three months of 2008, in large part because of gas prices…Although diesel historically has been cheaper than gas since it’s a gasoline byproduct, that’s not the case today because demand for diesel is growing, especially in emerging countries, said Norita Taylor of the Owner-Operator Independent Drivers Association, a trade group that represents 400,000 truckers and professional drivers, 5,700 of them in Michigan. Longtime truck driver Leo Wilkins, 62, of St. Charles remembers when he could fill his 2001 Peterbilt 18-wheeler for $300. Now it’s costing him more than $1,000 to fill the 300-gallon tank. Three years ago, his annual diesel bill was $35,000; this year, he expects it will be more than $80,000. "It’s killing us. It’s killing the trucking industry," said Wilkins, who delivers cars, large machinery and "anything that goes on a flatbed" to 48 states. He drives 120,000 miles a year and gets five miles to the gallon.” [Detroit News, 5/3/08]


Rising Fuel Costs Caused Owners of American Airlines a Loss of $328 Million in First Quarter of 2008. “The parent company of American Airlines, the AMR Corporation, posted a $328 million first-quarter loss as surging fuel prices sent the industry into a downturn. Major airlines tried raising fares across the board 10 times in the first quarter, and were successful in getting the increases to stick on 6 of those occasions, said Rick Seaney, chief executive of, a firm that tracks airfares. The individual [fare] increases ranged from $4 to $50 a round trip, Mr. Seaney said.” [New York Times, 04/17/08]

American Car Manufacturers Witnessed an 11% Decrease in Sales. “For those who thought they had a handle on the pace of change in the U.S. auto market, vehicle sales figures for May were a startling wake-up call. The Detroit Three are not wasting any time responding to the changes those numbers represent. Hit by gasoline prices that rose faster than anyone expected, vehicle makers found themselves in a market that had shifted suddenly – and radically – away from trucks and SUVs and toward smaller, lighter cars. General Motors Corp. saw its sales 28 percent in May compared to a year earlier, with a 37 percent decline in truck and SUV sales and a 14 percent drop in car sales. Ford Motor Co. sales fell 16 percent for the month, while Chrysler LLC’s sales were down 25 percent and Toyota Motor Corp.’s sales slipped 4 percent. Overall sales were down 11 percent compared to last May.” [WWJ 950/AP, Daily Dish]

Dow Chemical Company Must Increase Product Costs to Offset Gas Expenses.  “Dow Chemical Co. will raise product prices by up to 20% almost immediately to offset the soaring cost of energy and raw materials, and the CEO of the chemical giant lashed out Washington on Wednesday for failing to develop a sound energy policy. The price increases take effect Sunday and will be based on a product’s exposure to exorbitant costs. Dow said it spent $8 billion on energy and hydrocarbon-based feedstock, or raw materials, in 2002 and that could climb fourfold to $32 billion this year.” [CNN Money, 05/28/08]


State and Local Governments Are Being Squeezed by High Gas Prices, Forcing Service Cuts in Many Communities. “Rising gas prices are further squeezing local and state governments already struggling with increasing health care costs and dwindling tax revenue. A survey of 474 cities and counties by the International City/County Management Association for USA TODAY found that almost all have seen fuel costs rise since January. Sixty-two percent saw 10% to 20% increases. Almost one-third had spikes greater than 20%. For some communities, it will mean reduced city services.” [USA Today, 5/9/08]

High Gas Prices Have Forced Police Departments to Cut Back on Driving Patrols, Shrinking Coverage Areas and Increasing Emergency Response Times. “Rising gas prices are prompting some police departments to curb their cruisers for parts of their daily shifts and walk the beat instead — a change that shrinks coverage areas and increases emergency response times. Others are cutting back on a popular program that allows officers to take their vehicles home to boost police presence in neighborhoods.” [USA Today, 6/9/08]


Volunteers Are Being Forced to Cut Back on Trips Made for Volunteer Purposes Because of Soaring Cost of Gas. “But Sharing Connection, a group that collects donated furniture and household items for distribution to the needy, faces a double whammy: Donations are down in the poor economy, so there’s not as much work for volunteers like Sava. And now, she says, she has to scale back her trips to Sharing Connection to once a week ‘because the price of gas is going up horrendously.’ That’s something Cindy Johnson, volunteer coordinator for the agency, is afraid she’ll see more of as gas prices continue to set record highs. The trickle-down effect of gasoline prices could hurt volunteers across the suburbs — and people who don’t even drive.” [Chicago Daily Herald, 6/3/08]

Some Local Meals on Wheels Have Been Forced to Reduce Food Deliveries. “Fuel prices are forcing Meals on Wheels programs in Hocking and Athens counties to reduce the daily delivery of some hot meals, as well as what is the only contact some elderly clients have with the outside. Beginning Monday, both counties will deliver hot meals only on Mondays, Wednesdays and Fridays, along with frozen meals for clients Tuesdays and Thursdays. Similar changes might happen in the next year for the nearly 3,000 people served in Franklin and Madison counties if prices continue to rise. By cutting back from five delivery days, the Hocking-Athens-Perry Community Action Agency, which oversees the meals program in Hocking and Athens counties, will save $1,700 a month, said Dick Stevens, food nutrition director for the agency. ‘The circumstances are forcing us to make decisions we don’t like,’ Stevens said.” [Columbus Dispatch, 6/5/08]