KENNEDY OFFERS SOLUTIONS TO OIL CRISIS ON “LARRY KING LIVE”
Robert F. Kennedy Jr. appeared on CNN’s Larry King Live last night to weigh in on the nation’s oil crisis. (Note to CNN producers: booking RFK Jr. on the same show with John Stossel and Chevron’s David O’Reilly was a stroke of genius!).
It was a downright combustible debate. Kennedy certainly held his own and seemed to be the only panelist offering any real common sense solutions to the only question on the minds of many Americans this summer: how the hell do we get these gas prices down NOW?
If you missed the broadcast, here’s a partial transcript. (Full transcript is available here)
RFK JR. TO LARRY KING: “OUR CONGRESS IS BRAIN DEAD”
CNN “Larry King Live” Transcript
Aired June 30, 2008 – 21:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
LARRY KING, CNN ANCHOR: Tonight, crisis. Gas today reaches historic highs. Out of control prices have a death grip on millions, putting the squeeze on consumers, threatening the American way of life, forcing decisions no one should have to make. Eating or filling the tank? We’ll take tough questions to the head of an oil super giant and demand answers as struggle and sacrifice consume the country. Pain and panic at the pump, next on LARRY KING LIVE.
Good evening. The national average for a gallon of gas is $4.09, with consumers in 33 states paying that or more. Gas prices have risen almost 3 percent in the last month, almost 38 percent higher than a year ago. Oil prices passed a record $143 a barrel for a time today. We’ll go live to gas stations all across the country tonight.
…Joining us now, David O’Reilly, chairman and CEO of Chevron. He’s here in Los Angeles. And in New York, Robert F. Kennedy Jr., senior attorney, National Resource Defense Counsel.
Robert, what do you make overall of what David O’Reilly has stated so far?
ROBERT F. KENNEDY, JR. ATTORNEY: Well if the solution to this issue which he suggested is really on the demand side. It’s not about drilling offshore, which even the president has said the White House energy advisory administration has said that’s not even going to touch our problems. We won’t get the first oil from offshore until 2020 and we’ll have an insignificant impact on prices in this country. We don’t even know whether it’s going to be sold in this country.
First of all, even if we drilled every bit of oil on all of our public lands in Alaska, it’s less than 3 percent of proven global reserves. We’re using less than 25 percent of proven oil reserves in our country in our oil. So we can’t drill our way out of the problem.
The issue is a demand issue. We need to change demand and we do that by changing to other sources of to wind, to solar, to geothermal, to tidal and conservation.
The fastest way for us to solve our energy problems in this country is immediate conservation. If we improve fuel economy standards in our automobiles by one mile per gallon, we generate twice the oil that’s in the Arctic National Wildlife Refuge. If we raise fuel economy standards by 7.6 miles per gallon, we can yield more oil than we are currently importing from the Persian Gulf. We are borrowing.
KING: Hold it right there, Robert. David?
O’REILLY: Well, I agree, that first of all efficiency is the very first thing we ought to be working on. And there are new cafe standards in place that will obligate the automobile manufacturers to be more efficient and in fact you can see a shift already towards more efficient cars.
KING: Is he right?
O’REILLY: Well I disagree on the point of oil exploration. We’ve gone from 9 million barrels a day of production in this country to 5 million over the last 20 years. We are more and more dependent on that imported oil. We are going to have to use some oil in our transportation system during the next 20 or 30 years while some of this transition is taking place. It would be much better for us to develop it here at home rather than be dependant on imports that are coming extremely strained because of the demand in the rest of the world.
KENNEDY: Well, let me say this. I’m involved with a company called Better Place, which made a proposal a couple years ago to Israel to get Israel completely off of gasoline cars within three years. And Israel is going to do that. Within three years, they will be off of gasoline automobiles.
We can do that in this country, too, using shifting to electricity and electricity gives us a lot more versatility, it allows us to harness wind. We have — the Midwest this is the Saudi Arabia of wind. We have enough harnessable wind energy in North Dakota, Kansas and Texas combined to supply all the electrical needs of our country, even if every American were driving an electric car.
We have the “Scientific American” just published a report that shows in 19 percent of the most barren desert lands in the desert southwest, we have enough solar energy to provide all the electrical needs of our country. KING: David?
KENNEDY: What we need now is a national policy that say, OK, let’s go out and get those electrons and get them into the marketplace, let’s have a premarket economy.
KING: Wouldn’t that put you out of business, David?
O’REILLY: It won’t. I’m confident it won’t. But I encourage all these alternatives.
I think there’s room for all of them. I’m very concerned because the reality is today that these alternatives are a very small percentage. And just like it takes a long time to drill an offshore well, it takes a long time to find and develop and put in the sort of equipment that Mr. Kennedy is talking about.
What bothers me about this is everyone portrays it as an either/or debate. It’s not and either/or debate. It’s an and. We need alternative and we need efficiency and we need conventional oil and gas.
KING: We’ve got a call from Eureka, California, hello.
CALLER: Hi Larry, thanks for taking my call. And for Bobby Jr., I think your uncle, JFK was a good president and your father was a good guy. My question is to the oil guy. How much money does his oil company make off these ridiculous gas prices and I also blame the Congress for not doing anything.
KING: What does Chevron make?
O’REILLY: Well as I mentioned earlier in the first quarter, we made $5 billion, which is 7 percent of sales and exactly the median for all of the industry.
KING: Twenty years ago, 7 percent?
O’REILLY: Yes, about 7 percent of sales.
KING: So the percentage doesn’t change?
O’REILLY: The percentage has been about the same. You’ve got to keep in mind that as the revenues are going up, the costs are also going up. So it’s not as if this is all going to the bottom line.
KING: Do you agree, Bobby, that is there some misconceptions over this? That a lot of this perception is wrong, that what seems like billions is really not billions?
KENNEDY: Well I really think that they talk windfall profit tax, whether it’s good thing or it’s a bad thing, it’s not a long-term energy policy. What we need is really a long-term — and drilling off the coast is not a long-term energy policy. What we need is an energy policy. Today, Larry, we are borrowing a billion dollars a day mainly from countries that don’t like us to import oil from countries that don’t like us.
When I was a little boy, our country owned half the wealth on the face of the earth. We are now transferring that wealth at a historic rate to other countries, again, mainly nations that don’t like us. We have solutions.
Unfortunately, we have a Congress that’s really brain dead. I’ll tell you something that the Congress did today. First of all, they killed the investment tax credits for solar and wind which are absolutely vital to the growth of this burgeoning industry.
Second of all, today, Congress and the White House declared a moratorium, a two year moratorium on any solar plants being built on federal lands while they study supposedly the environmental impact. This is an administration that is opening up —
KING: I have to get a break, Robert. You want to comment, quickly?
O’REILLY: Well first of all, I think if we are concerned about the billions of dollars going overseas, couldn’t we shut some off by developing more of our oil here? Wouldn’t that be a good thing? I think this idea —
KENNEDY: Can I answer that?
KING: Do it quickly, I’ve got to get a break.
KENNEDY: It’s 2 percent of the oil, it’s 2 percent of global reserves. It’s going to do nothing. If we develop those 2 percent of global reserves, all the Saudis have to do is drop their production 2 percent. We don’t even know that oil is coming here. Are you going to guarantee if you get those oil leases that they’re going to come to the United States?
O’REILLY: These oil leases are in the United States.
KENNEDY: I know they’re here. But you’re not going to sell the oil here. You don’t have to sell the oil here.
O’REILLY: That’s the most ridiculous.
KENNEDY: I know it’s going to benefit you, but I don’t see how it will benefit the people of the United States.
O’REILLY: It is going to benefit the people of the United States and it’s far better to produce it here at home, where we don’t have to go overseas, we don’t have to send that money out of the country. It’s a far better value.
KING: We have to get a break, guys. Can either of the presidential candidates do anything about the price of oil? Supporters of each make the case next. (COMMERCIAL BREAK)
“OUR ADDICTION TO OIL IS THE SINGLE BIGGEST DRAG ON AMERICAN CAPITALISM” – RFK JR.
…KING: We’re back. Remaining, David O’Reilly and Robert F. Kennedy Jr. Joining us now in New York is John Stossel, the co-anchor of ABC’s “20-20,” and in Jacksonhole, Wyoming, Governor Bryan Schweitzer, Democrat of Montana. He’s in Wyoming for the Western Governor’s Conference. I understand, Governor Schweitzer, you think the solution to the energy crisis is coal?
GOV. BRIAN SCHWEITZER (D), MONTANA: That’s one of them. We need to produce American energy designed by American engineers and built by American workers. This is an energy source that could be exported all over the world. We can use coal. We have nearly an infinite supply of coal. But coal has a problem with carbon dioxide. We need to sequester the carbon dioxide. We have win power. We have solar power. We do have oil. We have oil shale.
We need multiple platforms in this country. But it doesn’t make sense to me to continue to drill in the third world and send 400 billion dollars a year to these dictators who would like to destroy our way of life. In America, we can produce our own energy system. We can produce the cars that run on electricity. And then those cars can be exported all over the world. We’ll produce electricity with wind and solar. Those cars will have batteries, so whenever the wind is blowing, whenever the sun is shining, they will store that energy. And the first 50 or 60 miles will be on electricity. After that, they’ll run on oil or some kind of gasoline.
Point is, we could eliminate all of our import needs. This is not like splitting the atom in the Manhattan Project. We already have this technology. We have an infinite capacity of producing energy. What we have is lack of leadership in Washington D.C.
KING: John Stossel, what do you make of this whole oil debate?
JOHN STOSSEL, ABC’S “20-20”: I think a lot of it is silly. I think we have an energy policy in America and the world and it’s called the free market. When oil is above 100 dollars a barrel, coal, as he’s saying, becomes viable. We don’t need Washington to do it. It’s a fatal conceit to say the politicians can lead this. Higher prices will lead to alternatives.
KING: How do I put coal in my gas tank?
STOSSEL: You won’t have to. They’ll refine it and make it into oil.
KING: They’ll do that?
STOSSEL: Yes. Governor Schweitzer can tell you all about that.
KING: You’re not troubled then by five dollars a gallon?
STOSSEL: Of course I’m troubled. It seems a little excessive when it costs twice that in some countries. I think these oil companies are heroes. Think what it takes to bring this stuff to us, across an ocean, refine it into three types of gasoline, put it in trucks that cost 100,000 dollars each, ship that to gasoline stations that have to have this expensive equipment so we don’t blow ourselves up pumping our own gas. It still costs less per ounce than the bottled water they sell at some of these gas stations.
KING: David, makes you feel good?
O’REILLY: That’s nice to hear someone on our side.
KING: Robert, would you elaborate a little what you said a little earlier about offshore drilling and going over seas with it?
KENNEDY: One of the points Mr. O’Reilly made and Mr. Stossel has made a lot is that it’s safe for us to drill offshore. Chevron is the biggest producer of oil in Cook Inlet in Alaska and it dumps billions and billions of gallons of highly toxic production waste every year into Cook Inlet. It has contaminated the salmon stocks. It has contaminated the beluga whales. We have the technology to reinject those wastes, but they’re not doing it. Now, they’re saying we should open up Florida and we should open up California and the offshore places there, and we’re going to do it right.
The other point I would make is what John Stossel is saying, a free market would be good. We don’t have a free market in the energy industry. Everybody knows that. We give a trillion a year in subsidies, direct and indirect subsidies, to oil, and somewhere near a trillion dollars to coal. We also — nuclear energy is also highly subsidized. If we had a real free market that does what a market is supposed to do, which is to reward good behavior and punish bad behavior and inefficiency, wind, solar, geothermal and tidal would easily triumph in the marketplace. You would see them immediately taking over the marketplace. The biggest impediment is these huge subsidies we’re pouring into incumbents.
KING: Governor, is he right?
SCHWEITZER: He’s partially right. Frankly, we had a one plank energy project in this country, and it’s been about oil. There was a little problem back in 1948, when we started importing more than we were exporting. It got to be a bigger problem and we complained when we got to 50 percent of oil. Then we complained at 55. Now, we’re at 65 percent of our oil that is imported.
Look, you can not trust the multi-national oil companies just to do business with dictators around the oil. If Chevron would like to drill some oil, come to Montana. You don’t have a single well in Montana and yet, we have one of the largest new discoveries in the continental United States. We could have as many as 15 billion barrels in a single formation and yet Chevron has not built a well in Montana.
STOSSEL: If they could find it in Montana, they would go to Montana.
SCHWEITZER: The independents are drilling it, not be multi- nationals.
KING: Got to get a break. Want to save money on energy, we’ll show you some alternatives, I hope, coming up.
KING: An e-mail for David O’Reilly from Bruce in Montana; “do you ever foresee the day when Chevron will make more profits by selling alternative fuel that is better for the global economy or will fossil fuel always be number one for money?”
O’REILLY: I think fossil fuel will be the predominant energy source for the next generation or so. If you wind back to — my grandkids were born in the first decade of this century. By the time they’re my age and beyond, I think the energy system will be quite different and maybe it will be.
KING: John Stossel, is Robert Kennedy right, this is not a free market if they’re subsidized?
STOSSEL: Yes. It’s wrong that there are all these subsidies. We should have a free market. But even without the subsidies, these alternatives are just not going to make much of a dent for a long time. They just are much too expensive. It’s interesting that Mr. Kennedy says he wants wind power, but he objects to a wind farm off his family’s compound on Cape Cod.
KING: Robert, can you quickly answer that? I got to talk to the head of AAA.
KENNEDY: On that issue, on Cape Wind, I have no objection to Cape Wind. I support that wind farm. I just think they should move it away from the fishing grounds, because it’s going to put out of business every fishermen on the Cape.
On the answer that wind and solar and the renewables can’t compete, that’s completely wrong. Look at the nations that have de- carbonized their economy. In 1970, Iceland was the poorest country in Europe. It was 100 percent dependent on imported coal and oil. They said, we’re not going to do this anymore. It switched. Today, it’s the fourth richest country in the world.
Our addiction to oil is the single biggest drag on American capitalism. As soon as we can get off of it, and we can get off of it very quickly, much quicker than these people are saying, our economy is going to explode.
Transcript courtesy of CNN.com.