Report entitled "Reserves of Crude Oil, Natural Gas Liquids, and Natural Gas in the United States and Canada and United States Productive Capacity as of December 31, 1972," extract of pages 4-25, 82, and 83, by the American Petroleum Institute, dated May 1973_. Study entitled "Analysis of Salient Issues Regarding the Estimation Article entitled "Too Much Energy," from the Economist of London, reprinted in the Washington Star-News, January 13, 1974. Simon, Hon. William E., et al.: Response to Chairman Proxmire's request to document for the record 131 146 107 Nelson, Hon. Gaylord, et al.: Editorials: "Knowledge and Power," from the New York Times, January 17, 214 Statement on S. 2782, a bill to establish a National Energy Information Article entitled "North Sea Oil: More Than We Know," by Bernard D. Response to Chairman Proxmire's request to check on how many days of gasoline supply the United States has in gasoline stocks_ Response to Chairman Proxmire's request to supply for the record what energy data collection and analysis funds were requested that were denied by the Department of Interior or OMB before the Response to Chairman Proxmire's request to supply for the record what competence is needed and what funding is required to meet the Federal Government's energy resource factfinding and Response to Chairman Proxmire's request to supply for the record the report entitled "Mining and Minerals Policy, 1973," second annual report of the Secretary of the Interior under the Mining and Minerals Policy Act of 1970, dated June 1973_- Response to Chairman Proxmire's request to supply for the record the present approach and procedure used by the Department of the Interior in requring, presenting, and assessing geological and geo- physical data on the extent and quality of offshore resources and 215 224 234 Rigg, Hon. John B., et al.—Continued Reponse to Chairman Proxmire's request to supply for the record the Response to Chairman Proxmire's request to supply for the record Shiskin, Hon. Julius, et al.: Prepared statement_._. Page 438 441 444 248 428 Response to Chairman Proxmire's question of how many full-time or 429 Response in the context of the colloquy and interrogation by Chairman MONDAY, JANUARY 14, 1974 CONGRESS OF THE UNITED STATES, The subcommittee met, pursuant to notice, at 10:30 a.m., in room 1202, Dirksen Senate Office Building, Hon. William Proxmire (chairman of the subcommittee) presiding. Present: Senators Proxmire and Javits; and Representatives Carey and Conable. Also present: Loughlin F. McHugh, senior economist; William A. Cox, Lucy A. Falcone, Sarah Jackson, Jerry J. Jasinowski, John R. Karlik, Richard F. Kaufman, L. Douglas Lee, and Courtenay M. Slater, professional staff members; Michael J. Runde, administrative assistant; Leslie J. Bander, minority economist; George D. Krumbhaar, Jr., minority counsel; and Walter B. Laessig, minority counsel. OPENING STATEMENT OF CHAIRMAN PROXMIRE Chairman PROXMIRE. The subcommittee will come to order. Mr. Simon, there is a great skepticism in the country. A shockingly large proportion of people, perhaps most of our people, doubt the existence of the energy crisis. They believe it is a Government-oil industry-sponsored put-on to raise prices and increase profits at the expense of consumers. Others say the oil shortage is real but it is being manipulated by the oil industry and Government to increase oil industry profits and the shifts and changes from day-to-day in statements from the Government adds to the turmoil. The first objective of these hearings, therefore, is to establish the facts and to get from those who make public policy the basis for their facts, the question of who provides them, how reliable they are, and what means the Government and the public have of verifying their accuracy. When I say that there is considerable question, I am sure you have been swamped by mail, too, but this is just typical of one Senator's office. We have had 3,843 letters in the last 3 weeks on the energy shortage and I am sure Senator Javits, coming from a bigger State, has had even more than that. Senator JAVITS. I would say we have nearer 20,000, 25,000. Chairman PROXMIRE. We want the facts on production, reserves, inventories, and consumption. We want the facts for both the immediate short-run problems and about the long-run issues. And we want the facts not only about supply and production but we want them about costs and prices. The full audit that you have pledged of refineries may give us some of the answers, I suspect not all the answers, and perhaps only a small part of it. Furthermore, at the present time, there seems to be little or no concern on the part of the Government itself as ot whether or not the huge, unprecedented, and inflationary rise in fuel costs are related in any direct way to costs. The immense increase in oil industry profits past and prospective makes a devastating prima facie case that these huge price increases are not cost justified. What effect does the rise in the price of fuel and gasoline have on inflation in this country? We are told that we must reduce fuel consumption by about 20 percent. Presently the basic public policy, in addition to minor conservation efforts, appears to be to allow the price to rise sufficiently to reduce consumption by that amount. But many economists tell us that to achieve that goal through the price mechanism alone, the price of gasoline will have to go up by 100 percent. What effect will that kind of increase have on inflation? And how many jobs are at stake? How high will unemployment go? How much additional Government spending will be required to pay for the increase in unemployment benefits, the rise in welfare costs? There is public outrage about this crisis. The average American family has been paying through the nose, first for inflation, second for massive increases in food prices, and now for skyrocketing increases for the gas to drive their cars and the fuel to heat their home. While the actual real income of the American weekly wage earner dropped this last year, oil company profits rose by 63 percent, according to the Business Week survey. The outrage at what has happened has led some people to call for the nationalization of the oil industry. Others call for putting the industry under public utility regulation. Personally, I do not believe that either step would be wise public policy. But the oil and gas industry and those in the executive branch of the Government should realize that the least we can expect from the energy industry are the facts. There must be full disclosure. This is not a private matter. This is a national crisis. Men and women are losing their jobs. Prices are going up at a fantastic rate. In these circumstances there is no way the American people are going to stand for a vital industry telling them that the basic facts are proprietary or secret information while they are paying through the nose for the consequences. Today our first witness is the head of the Federal Energy Office, the man who has been called the Energy Czar of the country. The people of the country have been impressed with Mr. Simon's vigor, his willingness, unique at this time, to talk to the press and the American people, and his obvious intelligence and ability. I think all of us should also be aware-I have said this in a previous committee, meeting, but I want to say it again, that I do not think anybody who has come to Government in recent years has made the kind |