Carter, his frustration rising, publicly threatened to veto any bill that simply deregulated natural gas. Undeterred by the threat, oil-state senators introduced a deregulation bill as their lobbyists furiously lined up votes. Whereupon two liberal, proconsumer Democrats, Senators Howard Metzenbaum of Ohio and James Abourezk of South Dakota, began a filibuster. Metzenbaum was a wealthy businessman who became a consumer champion and bitter enemy of the oil and gas industry; tall, stoop shouldered, and white haired, he was a forceful opponent of deregulation. Abourezk was a Lebanese American who had a venomous dislike of the energy industry (and, it seemed, almost everyone else in the Senate).
With time running out on the first session of Congress, the administration was desperate to obtain something from the Senate that could be sent to a House-Senate Conference Committee to tilt the final version toward the House bill. On September 26 supporters of deregulation rounded up more than the sixty votes needed to end the filibuster, but Metzenbaum and Abourezk were not so easily squelched. They filed 508 amendments and began demanding roll-call votes, one after another, tying up the Senate for three days. They also constantly demanded quorum calls that forced a roundup of fifty-one senators, and they objected to every routine request for unanimous consent by which the Senate moves forward, however slowly. Tempers boiled over at their tactics—every one of which was embedded in the Senate’s arcane rules. A round of administration-supported counteramendments was introduced the next day, whereupon Russell Long mounted a minifilibuster of his own against them. Metzenbaum and Abourezk resumed their filibuster, throwing all Senate business back into gridlock.8
Why did senators of both parties think they could roll Carter and get away with it? The Bert Lance affair had broken in the newspapers just as the Senate was taking up the bill, and it seemed obvious to the old Washington hands on our energy team that it created a perception of vulnerability. Lance’s loss was incalculable, not only because he would have been just the man to work with the Senate barons from the South and Southwest like Long, but because the affair tarnished the president’s reputation just when it had been enhanced by his victory in the House. It proved a major turning point for the administration—the first widely perceived public signal that Carter’s presidency lacked a certain political acuity, that he would not be able to deliver on his promises because he would not play Washington’s roughhouse politics.
The righteous aura that marked his “I’ll never lie to you” campaign speeches had begun to crack when it became clear that Carter was insensitive to Washington’s unforgiving balance between personal loyalty and practical politics. And once a leader is no longer seen as riding high and in command, his major initiatives are in trouble. Lance’s departure sent the president’s popularity down by more than ten points in the Gallup poll to just above 50 percent, a fact not lost on either the Senate’s Old Bulls or the administration’s worker bees. Both saw the system seizing up and began to sense that putting through Carter’s ambitious programs was going to be harder than they thought. Carter himself soon came to realize this, too.9
Byrd called the president and promised that the Senate “will do better and I will help.” Later that day Mondale called together Califano, Moore, Ham, and me for ideas on moving the Senate. Califano, a veteran of political battles as Johnson’s domestic adviser, said the president needed to tell the American people that “lobbyists are taking over the Senate” and “deregulation of natural gas was a rip-off.” He suggested putting out figures on how deregulation would hit individuals because that also would help shift the focus from Lance and show the president in charge. Carter followed this advice at his news conference, but wisely also decided to praise Byrd.10 Stroking Byrd in public paid off.
Frustrated by the train wreck on the Senate floor, this master of Senate procedure now was determined to use all his arcane knowledge to see that the hundreds of remaining amendments were thrown overboard. First he drew on a parliamentary rule—“No dilatory motion or amendment or amendments not germane shall be in order”—to block the flow of the Metzenbaum-Abourezk amendments. Then he argued that the Senate’s presiding officer was obliged to rule all such dilatory amendments out of order. Metzenbaum and Abourezk vociferously objected, but the fix was in for this highly unusual procedure. Byrd arranged for Mondale to arrive in the Senate chamber for the rare exercise of the vice president’s constitutional position as presiding officer. His job was to gavel down the parade of Metzenbaum and Abourezk amendments one by one as out of order, as Byrd systemically called them up. Mondale dispatched the first thirty-three in a matter of a few minutes. Byrd remembered that “pandemonium broke loose” as the two senators screamed for recognition to appeal Mondale’s ruling, which Byrd denied them. On appeal to the full Senate, they were flattened by a vote of 79 to 21, and their filibuster was over. Byrd and Mondale were in Byrd’s words, “severely criticized for the extraordinary actions we had taken.” A veteran of more than three decades in the Senate and its reigning historian, he called the filibuster on the natural-gas deregulation bill “the roughest filibuster I have ever experienced,” even “more intense, and far more bitter than the 1964 civil rights filibuster.”11
Abourezk expressed shock and indignation and declared: “Since I’ve been in politics I’ve been told that governments lie. One thing I never thought would happen is that Jimmy Carter would lie.” This parliamentary steamroller was also criticized by a number of Democratic senators, and the victory came at a cost to Mondale’s and Carter’s reputation as well as Byrd’s. They not only enraged their liberal allies but raised concerns about establishing a precedent for such strong-arm tactics. Carter himself lamented this in a call to Byrd a few days later: “I believe we used the wrong tactic. A little too abrasive. The Senate is not accustomed to that.”12 But it worked.
This uncertainty and inexperience was characteristic, not just of Carter himself but our entire White House staff; but the tactic was the only way to push the energy bill ahead although the result was anger that could be cut with a knife. Al Alm, the chief architect of the package, vividly recalled that the hard feelings “came within an inch of physical blows” by New Hampshire Democratic senator John Durkin in the cloakroom, where “these guys were just irrational on the subject [of natural gas]; it was crazy; everybody felt very strongly; it was rough stuff politically.”13 Worse, even after the filibuster was broken, the amendment deregulating natural gas was approved by the Senate, 50 to 46, similar to our long-abandoned campaign promise.
THE ROAD GROWS LONGER
By early October, Democrats and Republicans alike recognized that the president’s energy program was in deep trouble, and as portions of it reached the Senate floor, the press began ridiculing it as “the moral equivalent of chaos.” On October 6 the Senate approved a diluted conservation bill from the Energy Committee by an overwhelming vote of 86 to 7, while Long was making mincemeat of the House-passed tax proposals that represented the final leg of the energy plan. Throughout October his Finance Committee systematically rejected the president’s Crude Oil Equalization Tax (COET), the tax on gas guzzlers, and the tax on the industrial use of oil and gas.
The only fiscal measure to survive the Senate Finance Committee was a tax credit to homeowners for insulating their homes or installing solar heat, and this expensive credit would benefit mainly high-income householders rather than poor people who needed cash subsidies to help them save energy to heat their modest homes. The defeats were due in part to the fact that, unable to agree among ourselves, the administration could never put together a clear and persuasive program of what we would do with the tax revenues. That made it easier for Long to argue that the money should be rebated to the producers as an incentive to drill rather than to the consumers as a protection against higher prices. During debate on the Senate floor, Long quipped, with a glint in his eye, “Just what do they think we are, a bunch of Houdinis on this Committee of Finance?” In fact he had designed a simple tax giveaway that would have been appreciated
by the legendary escape artist.
What he was really doing was freeing his hands to cut a deal in the Senate-House Conference; he would compromise on the House-passed wellhead tax as long as enough of the revenue found its way back home to the producers. Stroking his oil and gas constituency in colorful but politically potent terms, he intoned: “The American people are not willing to pay more taxes unless they can expect to receive more energy. If all they are going to pay taxes for is a two-way ticket for their money to Washington and back, with Washington’s expenses deducted on the one end, they are going to think we are a bunch of idiots to pass it, and vote us out of office for imposing it on them.”14
The president meanwhile had begun to demonize the oil and gas industry in ways that were especially offensive to Long, who excoriated him for calling them war profiteers. As we observed to the president in his study,15 Long had worked out a devilishly clever strategy. He had refused to bring any of the energy-tax measures to the floor to avoid an embarrassing defeat so that he could have a free hand to make a deal with representatives of the House in the closed Conference Committee. And his mastery was complete because he also controlled the members of his Senate Finance Committee, which gave him blanket authority to put all the tax measures in his pocket to deal on their behalf.
Long had also split the House and Senate Democratic leadership and turned them at least temporarily against the president. The anger burst out at a White House breakfast on October 13, when O’Neill complained to Carter: “You have proposed so much legislation, we can’t handle it all. You made a lot of campaign promises and you keep sending up messages [demanding Congressional action].” Then he turned to Byrd and said he had held his troops together and would also tie the House energy bill in one package and refuse to go to conference “until we know what Long will do. We need to see the whole [Senate] package.” Byrd, clearly irritated, shot back the Senate had passed four bills and “if we have to wait until Long finishes, we will have lost valuable time.” Then he pointed out that despite the president’s efforts to raise the alarm about our growing dependence on OPEC oil, he found it shocking that polls showed that almost half of all Americans did not know that the nation imported any oil at all.16 We were under no illusions: The administration had no choice but to support Long’s strategy if it wanted any bill at all, and we would not get one unless the House and Senate conferees accepted deregulation of natural gas.
As the start of the Senate-House Conference approached, the cabinet convened on October 17 in a meeting that was extraordinary for the precision of its agenda and astounding for its candid admissions by the president. He had finally arranged the order of battle with a great sense of urgency. “Success on many programs is tied to energy, as is my image as a leader,” he told his cabinet, instructing them to work “as a unit” to help pass the energy program. He laid out a detailed plan for cabinet officers and their deputies to make one additional speech per week on energy. In their appeal for support they were to relate energy directly to their department’s functions—transportation, defense, commerce, and so on. They were also tasked with persuading influential laymen in their states to contact their senators and argue for the program, and to make a list for Ham of senators and congressmen with whom they had “personal relationships.” Showing his desperation, the president admonished his cabinet to do something he had never previously considered—tie federal grant money to votes: “Use your political influence. If they want something for their states, tie it to energy, and say ‘Our success in the next three years depends on this.’”
He also instructed them to raise the international implications—for example, to emphasize that the bill was “crucial to Israel’s security; that we should not be dependent upon Middle East oil.” In the starkest terms I had ever heard him use, Carter laid his own legacy on the line: “If we get whipped on this, then incompetence and weakness will be perceived. This may be unfair, but this will be our image and it will become a reality.”
Remarking—as history would show—that his administration’s successes would be buried because he had launched so much legislation,17 he promised to be more selective in setting priorities and be judged “by only a few key things in the next few years.” Admitting that he “had slipped” in not meeting with the Senate committees, as he had with the House, Carter canceled a long-scheduled foreign trip to make a full-court press—in vain, as it turned out.
Then he made a startling admission I had never heard before or since from this supremely confident man: “The issues before us are so complicated, it’s gotten past me.” To soothe the president’s feelings, Strauss added, “Frankly, no one understands it.” Nevertheless his top aides could provide little news that would make him or anyone else at the meeting feel better. Budget Director McIntyre estimated that the tax incentives and other giveaways that Long had attached to the Senate bill would add $25 to $35 billion to the budget deficit. Schultze warned that without energy reform, oil imports could raise the trade deficit by $100 billion a year, risking “a substantial deterioration of the dollar.”
Struck by the way his economic adviser had framed the threat, Carter asked him and Blumenthal to “draft a paragraph and get it to Stu, without causing a run on the dollar.” Blumenthal quickly came up with more diplomatic language: “Just say that without the energy bill, the problems of the dollar will get worse.” To close the exhaustive and exhausting cabinet meeting, the president barked out our assignments in staccato form like the naval officer he once was: “Stu and Jim are the technical people; Frank [Moore] is the key person with Congress; Jack Watson will help you schedule speeches; Bob Strauss will call you with ideas; and Ham will coordinate the entire effort.”18
THE CONFERENCE COMMITTEE FROM HELL
The Conference Committee of House and Senate members held its first meeting on the complex energy bill the following day. Their task was to resolve the differences between the two chambers in a compromise package for an up-or-down vote, and then send it on to the president for his signature or veto. For interest groups, a conference committee represents their final opportunity to bend important legislation. They usually start with their maximum demands; the more exalted their motives, the more unbending they tend to be. Business, by contrast, can usually make a rough reckoning of how deeply any compromise will affect costs and profits, and then act accordingly. So can officials and experts, both elected and appointed, because they live with the classic dictum that politics is the art of the possible.
But here was a conference from hell, perhaps the lengthiest, most difficult, most bizarre in congressional history. Agreements among the conferees were reached by paper-thin majorities and then abandoned. Egos clashed over petty peeves as well as grand issues of policy. Angry words were exchanged, and unholy and unlikely alliances were formed to block action. Compromises were cobbled together to attract coalitions by lengthening or shortening the transition period for deregulation or slicing the wellhead tax rebate by different formulas to attract regional votes. None lasted very long. Republicans and producer-state Democrats banded together against compromises ending federal price controls too slowly for the oil patch, while liberal Democrats and consumer groups believed the sky would fall if controls were removed at all. Estimates of the impacts of the many different proposals varied wildly, and even Schlesinger’s figures moved dramatically as the conference droned on, month after month. This was Congress at its worst.
Organizing this conference was especially difficult. The gap between the two chambers was as wide as the state of Texas. The House wanted all conference members to consider the entire package, while the Senate, with its piecemeal approach, wanted a separate sub-group to consider each bill in the form it had been passed by the upper chamber. The first compromise was the organization of informal groups to work on provisions that did not involve taxation, while the tax measures would be considered separately by members representing the Senate Finance Committee and House Ways and Means Committee. More than forty confer
ees debated the five sections of the program, and they included many barons of both chambers. In a highly unusual move symbolizing the stalemate over natural gas, Senator Jackson named as conferees his entire Energy Committee—eighteen members who had split into equal halves in voting on whether to continue federal controls.
The president began his efforts by promising the House conferees that he would make no deals with the Senate on which the House did not agree—a promise he would not be able to honor in full because he would be forced to swing toward the Senate’s gas deregulation if he wanted any bill at all. He also told House members his energy plan would achieve a budget surplus of $7 billion by 1985—so that in the long run it was “cheaper to conserve.” It sounded good in theory, but the decades-long natural-gas impasse was too high a bar for it to work in practice. When Senator Bentsen came up with a rebate formula tied to a new government agency to lend money to the oil and gas industry, Representative Toby Moffett of Connecticut complained bitterly that it would all be at the expense of consumers.” The president retorted, “Tell me if you see this happening; I won’t hurt consumers.” He was depending on the Senate meeting the House halfway and assured the House conferees that “the Senate was acting in good faith and its reputation is at stake.” He would eventually have to eat those words.19
At the end of another grueling day fighting the energy wars, Mondale and the top White House staff members met to discuss the priorities for the coming year. But with great frustration the vice president bemoaned the focus on energy when “the American people are concerned only with jobs and inflation.”20
President Carter Page 24
