After oil subsidies vote falls short, focus turns to drilling

By Karoun Demirjian

Wednesday, May 18, 2011 | 11:49 a.m.

As expected, Tuesday’s attempt by Senate Democrats to end long-standing subsidies to the oil and gas industries didn’t pass.

But is that the end of the line for grandstanding on petroleum in Congress? Hardly.

The oil vitriol is still pumping through the Senate today as lawmakers gear up for a related vote: this time, on a House-backed Republican proposal to expand drilling and guarantee a 60-day turnaround on petitions, backstopped by the promise that if regulators take longer to review an application, it’s automatically approved. It’s not expected to pass, either.

Still, Senate Majority Leader Harry Reid told reporters Tuesday that he’s “confident that before we finish our budget negotiations” a repeal of oil and gas subsidies “will be part of it.”

Regardless of whether his ultimate prediction comes true, his statement is a guarantee that we’re in for a protracted fight over petroleum.That budget process is currently in a bit of a tailspin.

On Tuesday, Republican Sen. Tom Coburn of Oklahoma announced he was “taking a break” from budget negotiations in the Gang of Six, a group led by Budget Chairman Kent Conrad, the retiring Democratic senator from North Dakota. It also includes Democrats Dick Durbin of Illinois, Reid’s deputy in the Senate and Mark Warner of Virginia; and Republicans Saxby Chambliss of Georgia and Mike Crapo of Idaho.

The Gang of Six -- now a Gang of Five, it seems -- isn’t the only ad hoc body that’s been bustling over the budget in recent weeks. Vice President Joe Biden has also been convening regular meetings with six lawmakers, drawing from House and Senate leadership to hash out terms of budget. The Democrats in his group are Senate Finance Committee Chairman Max Baucus, Senate Appropriations Committee Chair Daniel Inouye and House Democratic Leadership Reps. Jim Clyburn of South Carolina and Chris Van Hollen of Maryland. The Republicans are House Majority Whip Eric Cantor and Senate Minority Whip Jon Kyl.

Lawmakers like Republican Senate Minority Leader Mitch McConnell have put their public confidence in the Biden-led group.

“With all due respect to the Gang of Six, or any other bipartisan discussion going on this issue, the discussion that could lead to a result between now and August are the talks being led by Vice President Biden,” he said last week.

“I think it has great potential because it’s bipartisan, and it’s the leadership,” Baucus, a participant, said of the Biden group, explaining that its promise came from its composition, which reflects all of the key alliances that must be struck in the 112th Congress for legislation to proceed.

“The Democratic president in the room, essentially, with the Republican House leadership in the room, essentially,” Baucus said, “and the rest of us trying to help out and find the solution.”

Last week, Senate Democrats and Republicans each visited the White House as a caucus to meet with Obama and discuss the budget and debt ceiling.

The "Biden commission," as it's come to be known, has struck deals so far on about $150 billion worth of cuts, according to Kyl. That’s much more than lawmakers stripped from the remaining fiscal 2011 budget last month, but still falls short, both sides have agreed, of where they hope to be.

The Biden commission does not appear to have yet started slogging through the tricky issues of entitlement spending and taxes, as the Gang of Six had been.

It’s in the Gang of Six that Republican and Democratic ideologies had already started to clash, much as they have been across Congress, about how to re-right the government’s balance sheets.

Republicans have proposed reconfiguring social spending programs like Medicare as a way of reining in spending over the long-term, through such vehicles as the House-approved budget of Paul Ryan, which converts the long-standing government-issue insurance program into a government-subsidized market-based system for those 55 and younger. Democrats say the changes will kill Medicare; Republicans say they’re necessary to save it -- and warn in the bill that soon, it’ll be necessary to start looking at Social Security (though no changes to that program are made in Ryan’s bill).

Democrats, on the other hand, say it’s necessary to raise revenue at the same time as cuts are made, and want to do that by eliminating Bush-era tax cuts on top wage earners after the current tax compromise expires.

Coburn, one of the most conservative Republicans in Congress, had actually been backing a philosophy more akin to the Democrats’, if not agreeing with their precise positions, for months. Last year, he voted as a member of the President’s bipartisan Debt Commission to approve a combination of tax hikes and spending cuts to get the deficit under control.

Republican Speaker John Boehner said last week that tax hikes are the one thing that are “off the table” as lawmakers discuss the budget. Forty of the Senate’s 47 Republicans, including Nevada Sen. Dean Heller, have also signed the low-tax lobbying group Americans for Tax Reform’s “Taxpayer Protection Pledge” to never vote to raise taxes. But that pledge doesn’t seem very binding: Coburn took it, and yet voted to approve the debt commission that would raise taxes.

“We shouldn’t be drawing lines in the sand,” Reid said in response to that. “We should be willing to work together. And the fair way to do that is to cut spending, we know we have to do that, but also to make the tax code a little more fair ... rather than drawing lines in the sand, that's where we should be.”

But Reid, too, has drawn a line in the sand on Social Security, which he has guaranteed time and time again won’t be touched for as long as he is majority leader.

Democratic members of Biden’s commission of six said Tuesday they believed their group would be able to tackle entitlements and introduce some tax changes, despite push back to selected initiatives from members on either side of the aisle.

“We’re talking, we’re talking,” Baucus said. “We’ll see.”