Kleeb talks energy during Grand Island visit

America shouldn't attempt a single-focus "Manhattan project" to solve its energy problems, according to Scott Kleeb, Nebraska Democratic candidate for the U.S. Senate.

Instead, it needs t multi-pronged approaches to tight energy supplies and high prices.

Kleeb made his comment during a Wednesday afternoon interview with The Independent's editorial board.

Earlier in the day, Kleeb issued a statement saying that he is urging Congress to pass the Stop Excessive Energy Speculation Act.

"Too much of what we pay at the pump now goes to Wall Street speculators who do nothing and help no one," Kleeb said in the written press release.

During his interview, Kleeb was asked about critics who contend speculation does not play a large role in the price of gasoline. He said he disagrees.

He referred to a statement that Mark Cooper, director of research for the Consumer Federation of America, made in June to the U.S. Senate Committee on Commerce, Science and Transportation.

During his testimony, Cooper referred to a paper by the Japanese Ministry of Economy Trade and Industry that said three factors -- market speculation, geopolitical risk and currency factors -- were responsible for $30 to $40 of the price of West Texas intermediate crude, which averaged $90 a barrel during the second half of 2007.

Kleeb noted the price of a barrel of oil broke through $100 a barrel in 2008. The price of oil has risen on an even sharper trajectory since breaching that benchmark.

He said that dramatic rise is not simply the result of global supply and demand.

Hedging has a legitimate role in determining the price of oil and other commodities, Kleeb said. However, he said the Stop Excessive Energy Speculation Act of 2008 has a number of good provisions.

As an example, the proposed law would close the so-called "London loophole," Kleeb said. That provision means oil traders using a foreign exchange would be treated as if they were trading in the U.S. for regulatory purposes.

Kleeb said Congressional approval of the act would be one of three things the federal government should do in the short-term to deal with high energy prices and a struggling economy.

He said another short-term step would be releasing oil from the nation's strategic oil preserve. That would help lower gas prices.

Kleeb's campaign office later said that releasing 500,000 barrels of oil a day for 100 days would still leave the strategic oil reserve 92 percent filled.

A second stimulus package would also provide a short-term benefit for the economy, Kleeb said.

An intermediate step would be providing tax incentives for people and businesses to retrofit homes, offices and plants with solar panels and other energy-saving devices, Kleeb said. Incentives also should be provided for hybrid vehicles.

Over the long term, America must embark on a program like the National Defense Education Act, which was the U.S. government's  response to the Soviet launch of the Sputnik satellite in 1957.

He said research should done on wind, solar, ethanol and other renewable energy sources. Nuclear energy must be part of the mix, with research focusing on ways to lessen the amount of waste material from nuclear power plants.

Oil exploration must continue, Kleeb said.

While some people favor opening up new areas such as the intercontinental shelf and Arctic National Wildlife Refuge to drilling, Kleeb said he is more interested in companies exploring and drilling for oil on the 68 million acres of federal land where they already hold leases. If companies don't drill on those acres, their leases should be turned over to those that will.

Kleeb said high energy prices especially affect Nebraskans, because of the long driving distances in the state. Nationally, Americans are spending 4.2 percent of their income on energy, but in Great Plains states like Nebraska, people are paying about 13 percent of income on energy.



Other topics of discussion

Scott Kleeb, Democratic candidate for the U.S. Senate, touched on numerous subjects during his Wednesday interview:

n Reducing the federal deficit: Kleeb wants a return to "paygo rules," where any new federal spending must be offset by a cut in spending elsewhere or a tax increase. He said such rules helped reduce the federal debt from 4.5 percent of gross domestic product in 1991 to a surplus of 2.3 percent of GDP in 2000.

n Illegal immigration: Kleeb said the U.S. must secure its borders. He said both employers and illegal immigrants should be punished. Illegal immigrants should be fined and they should "go to the back of the line" in obtaining U.S. citizenship, behind all immigrants who are using legal avenues to enter the country and become U.S. citizens.

n International trade: Kleeb said the U.S. should continue to have free trade agreements. But he noted China runs a large trade surplus with the U.S. because it does not allow its currency, the yuan, to float on international markets. He said China also has a competitive advantage because its companies pay workers so little and because its environmental standards are so low. Trade must become part of U.S. diplomacy, although there will be no quick fixes, he said.