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Business, Free Enterprise and Constitutional Issues; Pro-Life and Pro Second Amendment. Susan Lynn is a member of the Tennessee General Assembly. She serves as Chairman of the Consumer and Human Resources subcommittee and on the Finance Ways and Means Committee. She holds a BS in economics and a minor in history.

Thursday, June 12, 2008

Wall Street Journal Editorial

$4 Gasbags

Wall Street Journal, June 12, 2008; Page A16

Anyone wondering why U.S. energy policy is so dysfunctional need only review Congress's recent antics. Members have debated ideas ranging from suing OPEC to the Senate's carbon tax-and-regulation monstrosity, to a windfall profits tax on oil companies, to new punishments for "price gouging" – everything except expanding domestic energy supplies.

Amid $135 oil, it ought to be an easy, bipartisan victory to lift the political restrictions on energy exploration and production. Record-high fuel costs are hitting consumers and business like a huge tax increase. Yet the U.S. remains one of the only countries in the world that chooses as a matter of policy to lock up its natural resources. The Chinese think we're insane and self-destructive, while the Saudis laugh all the way to the bank.

There are two separate moratoria on offshore drilling: One is a ban that Congress has attached to every budget since 1982, and the other is a 1990 executive order that President Bush has waived in only a few cases. Republicans made failing attempts to overcome both when they ran Congress, but current Democratic leaders and their green masters remain adamantly opposed.

The new political opportunity amid record prices is to convince enough rank-and-file Democrats that they'll suffer at the polls if they don't break with this antiexploration ideology.

While energy "independence" is an impossible dream, there's no doubt the U.S. has vast undeveloped fossil-fuel deposits. A tiny corner of the Arctic National Wildlife Refuge contains an estimated 10.4 billion barrels of oil and would be the largest producing oil field in the Northern Hemisphere. Yet the Senate blocked that development as recently as last month. The Outer Continental Shelf is estimated to contain some 86 billion barrels of oil, plus 420 trillion cubic feet of natural gas. Yet of the shelf's 1.76 billion acres, 85% is off-limits and 97% is undeveloped.

Engineers recently perfected refining solid shale rock into diesel or gas, which may amount to the largest oil supply in the world – perhaps as much as 1.8 trillion barrels in the American West. That's enough to meet current U.S. oil demand for more than two centuries. Yet as late as 2007, Democrats attached a rider to the energy bill that prohibits leasing the federal interior lands that contain at least 80% of America's oil shale. The key vote was cast by liberal Senator Ken Salazar from Colorado, of all places.

These supply guesses are probably conservative, because the only way to know for sure is to drill exploratory wells. Yet most of Alaska and offshore are cut off even from modern seismic testing. Many areas haven't been examined since the 1960s, when exploration technology was far more primitive. This has led to the believe-it-or-not situation in which the Chinese are prepping to drill in Cuban waters less than 60 miles off the Florida coast. American companies are banned from drilling in American waters nearby.

Yes, we know, increased drilling is no energy cure-all; new projects take about a decade to come on line. Then again, more than a few experts say that new production could affect price as the market perceives a new U.S. seriousness to increase supplies. Part of today's futures speculation is based on the assumption that supplies will remain tight for years to come, even as Chinese and Indian demand surges.

Nor would merely repealing the exploration bans be enough. Between 2000 and 2007, the drilling of exploratory oil wells climbed 138%, but over the same period domestic crude oil production decreased 12.4% and fell to the lowest levels since 1947. Refineries for gasoline are stretched to the limit, but multiple regulatory barriers impede new construction or even expansions at existing facilities. Then there is the inevitable lawsuit downpour from the environmental lobby.

Democrats are going to have to grow up. The oil-rich areas they want to leave untouched are accessible with minimal environmental disturbance, thanks to modern technology. Hurricanes Katrina and Rita flattened terminals across the Gulf of Mexico but didn't cause a single oil spill. As for anticarbon theology, oil will be indispensable over the next half-century and probably longer, like it or not. Airplanes will never fly on woodchips, and you won't be able to charge your car with a windmill for some time, if ever.

Public anger over fuel prices could hardly come at a worse time for the GOP, since voters tend to blame a flagging economy on the party that occupies the White House. But the opportunity is to offer a reform alternative to Barack Obama and the high-price energy status quo he embraces. It looks like the public is increasingly ready for . . . change. In a May Gallup poll, 57% favored "allowing drilling in U.S. coastal and wilderness areas now off limits." Just 20% blamed the increase in gas prices on Big Oil, like Mr. Obama does.

Recent weeks have seen some GOP stirrings on Capitol Hill, but John McCain has so far refused to jettison his green posturings, such as his belief in carbon caps and his animus against offshore development. A good reason for a rethink would be $4 gas. At present, it is charitable to call Mr. McCain's energy ideas incoherent, and it may cost him the election.

Saturday, June 07, 2008

George Will Column

George Will's column below is a great illustration of how the suffering caused by today's high energy prices is not just a problem caused by the Congress' current energy policies but it is a problem brought about over the last ten, twenty, thirty or more years.

Instead of voting to keep America strong they have weakened America and our quality of life. Such policies will always have a greater impact on the poor. As we can see by the high prices of energy, food and clothing, they do.

The Gas Prices We Deserve

By George F. Will

Thursday, June 5, 2008; Page A19, The Washington Post


Rising in the Senate on May 13, Chuck Schumer, the New York Democrat, explained: "I rise to discuss rising energy prices." The president was heading to Saudi Arabia to seek an increase in its oil production, and Schumer's gorge was rising.

Saudi Arabia, he said, "holds the key to reducing gasoline prices at home in the short term." Therefore arms sales to that kingdom should be blocked unless it "increases its oil production by one million barrels per day," which would cause the price of gasoline to fall "50 cents a gallon almost immediately."

Can a senator, with so many things on his mind, know so precisely how the price of gasoline would respond to that increase in the oil supply? Schumer does know that if you increase the supply of something, the price of it probably will fall. That is why he and 96 other senators recently voted to increase the supply of oil on the market by stopping the flow of oil into the Strategic Petroleum Reserve, which protects against major physical interruptions. Seventy-one of the 97 senators who voted to stop filling the reserve also oppose drilling in the Arctic National Wildlife Refuge.

One million barrels is what might today be flowing from ANWR if in 1995 President Bill Clinton had not vetoed legislation to permit drilling there. One million barrels produce 27 million gallons of gasoline and diesel fuel. Seventy-two of today's senators -- including Schumer, of course, and 38 other Democrats, including Barack Obama, and 33 Republicans, including John McCain -- have voted to keep ANWR's estimated 10.4 billion barrels of oil off the market.

So Schumer, according to Schumer, is complicit in taking $10 away from every American who buys 20 gallons of gasoline. "Democracy," said H.L. Mencken, "is the theory that the common people know what they want and deserve to get it good and hard." The common people of New York want Schumer to be their senator, so they should pipe down about gasoline prices, which are a predictable consequence of their political choice.

Also disqualified from complaining are all voters who sent to Washington senators and representatives who have voted to keep ANWR's oil in the ground and who voted to put 85 percent of America's offshore territory off-limits to drilling. The U.S. Minerals Management Service says that restricted area contains perhaps 86 billion barrels of oil and 420 trillion cubic feet of natural gas -- 10 times as much oil and 20 times as much natural gas as Americans use in a year.

Drilling is underway 60 miles off Florida. The drilling is being done by China, in cooperation with Cuba, which is drilling closer to South Florida than U.S. companies are.

ANWR is larger than the combined areas of five states (Massachusetts, Connecticut, Rhode Island, New Jersey, Delaware), and drilling along its coastal plain would be confined to a space one-sixth the size of Washington's Dulles airport. Offshore? Hurricanes Katrina and Rita destroyed or damaged hundreds of drilling rigs without causing a large spill. There has not been a significant spill from an offshore U.S. well since 1969. Of the more than 7 billion barrels of oil pumped offshore in the past 25 years, 0.001 percent -- that is one-thousandth of 1 percent -- has been spilled. Louisiana has more than 3,200 rigs offshore -- and a thriving commercial fishing industry.

In his book "Gusher of Lies: The Dangerous Delusions of 'Energy Independence,' " Robert Bryce says Brazil's energy success has little to do with its much-discussed ethanol production and much to do with its increased oil production, the vast majority of which comes from off Brazil's shore. Investor's Business Daily reports that Brazil, "which recently made a major oil discovery almost in sight of Rio's beaches," has leased most of the world's deep-sea drilling rigs.

In September 2006, two U.S. companies announced that their Jack No. 2 well, in the Gulf 270 miles southwest of New Orleans, had tapped a field with perhaps 15 billion barrels of oil, which would increase America's proven reserves by 50 percent. Just probing four miles below the Gulf's floor costs $100 million. Congress's response to such expenditures is to propose increasing the oil companies' tax burdens.

America says to foreign producers: We prefer not to pump our oil, so please pump more of yours, thereby lowering its value, for our benefit. Let it not be said that America has no energy policy.

georgewill@washpost.com

Wednesday, June 04, 2008

Value Added School Performance

Tennessee's value-added evaluation system is frequently lauded across the country as a very good way to measure student achievement and school performance.

Today I received an easy to use tool to determine how your child's school performs.

The Education Consumers Foundation is pleased to give you direct access to information on the value-added achievement of all the schools in Tennessee.

Please visit https://owa.legislature.state.tn.us/exchweb/bin/redir.asp?URL=http://srv.ezinedirector.net/?n=2266692%26s=44101708 to explore the schools in your area.

Tuesday, June 03, 2008

Tennessean Column May 2008

Recently the Tennessean published my guest column below with a rebuttel written by Rep. Mike McDonald and the final word given by the Tennessean editorial staff.

I was very proud that the Tennessean agreed with me that the state should not use its power to legislate property rights away from individuals.



State Should Respect Property Rights

Buyer beware - children learn the phrase, adults experience its meaning, and attorneys are trained in its certainty.

Most learn from their mistakes and go on. However, the state's recent attempt to either buy its way out of a regretful deal or legislate its way out of the deal should raise citizen's interest.

The Governor’s administration may be commended for greatly increasing our state park land. However, after a recent acquisition, it was learned that the purchase price didn’t include certain rights, among them logging. Naturally, the timber company that owned the trees kept on harvesting. The environmentalist outcry caused the Governor to include $82 million dollars in last year’s budget to purchase said trees, et. el.

Now we find out another “regretful” deal neglected to purchase the mineral rights to the Cumberland Trails State Park. Not surprisingly, the rock harvesters that own the rocks continue to harvest them. Like most minors, they don’t earn very much. Some of them supplement their earnings with food stamps.

The mining activity is not pretty. As the harvesters work to fulfill the nations latest fad; “green” building materials, several environmental groups are upset by the disturbance of the land to obtain the rock. Thus far the harvesters have followed the law and regulations; stabilizing the land and complying with water pollution rules. But objectors want a state park to look natural and untouched. And who wouldn’t?

The harvesters offered to sell their mineral rights to the state for appraised value but the state refused choosing instead to file suit. When the judge sided with the harvesters, the state decided to legislate the embarrassment away by proposing a law so restrictive that the harvesters may just give up - effectively; an unconstitutional taking of private property. Tennessee’s citizens should be treated better than this.

Some believe that the end justifies the means. I ask, is it fair to purchase land without all of the rights, and at less than full market value, and then legislate the harvesters’ ability to exercise their property right away? If an end, no matter how strongly desired, is brought about by bad means are we not compelled to work for a better end brought about by acceptable means?

As children we learned that a deal is a deal, and to honor our agreements. As adults we learn the significance and sanctity of a contract. We are careful to agree on terms acceptable to both parties prior to a sale. We can’t change the past. The right thing now is to purchase the mineral rights for a fair value.

Prosperous is the nation that is able to utilize her rich natural resources, and wise is the nation that cares for the environment. However, if laws are made so restrictive that those resources cannot be gathered; if a nation cannot acquire her coal, her timber, her minerals, her oil and gas; then that nation and her people will suffer unnecessarily.

Tennessean Column Dec 2, 2007

Republicans vigilant on available funds
By State Representative Susan Lynn

State tax revenues are suffering as collections are currently $135 million below their mark. Before wish lists for the new session are even considered, many want to know how the state will manage our way through a budget already more than $100 million dollars short in the first quarter.

Last May, legislators debated over the Copeland Cap; a constitutional amendment that limits the growth of the budget to the growth in personal income. Signs of a softening economy worried Republicans as they cautioned against spending every penny of the massive $1.5 billion surplus, plus an additional $220 million dollar cigarette tax increase on new programs. In addition, it was difficult to understand how by spending so much more money we could not have been exceeding the Constitutional limit of the Copeland Cap by far more than was stated.

But we’ll have to manage. Most business managers will adjust to the economic downturn by making tough decisions like restraining spending, reducing new hires, curtailing unnecessary travel, and by putting expansion plans on hold. The state should do no less.

It is clear that 2008 may not be the time to fill wish lists by starting new programs or expanding old ones; after all, we can’t continue to ignore the inflationary demands of necessary commodities forever such as those needed to repair and build new roads. It is time to concentrate on government’s core basis for existence; those things that have an immediate impact on justice, health, safety or supply.

The Department of Education is hoping for an additional $133 million dollars next year to help fully fund the newly revised basic education plan. A little more controversial is a request of $30 million dollars to expand the pre-k program by 38%. The department notes that this addition to the currently $80 million program would help to advance the state toward universal pre-k; an $196 million goal.

Some may call legislators who are cautious about such an expansion mean spirited; others realists. We already have a burgeoning state budget shortfall. There will likely be local government budget shortfalls. Many local school systems are struggling to afford a desperate need to repair or to build new schools just to accommodate the current students. And there is much data that indicates no long term beneficial effect from early education.
Many wonder, why not just concentrate on what we already know needs improvement, and that which will save money in the long run - accountability. How much more would taxpayer dollars be multiplied by ensuring greater accountability?

Getting through this revenue downturn will require restraint, leadership and cooperation. We were proud of how our state employees efficiently handled the departmental budget cuts in 2003 and 2004. No doubt they will handle 2008 with the very same degree of professionalism.

Republicans will continue to respect the taxpayer’s hard work by remaining good stewards of the dollars they provide, and by displaying an understanding for the pressures they face in their own family budgets every day.