Landrieu must change bill to secure election advantage

What you can do I can do better, the two major candidates for Senate in Louisiana have told each other over the past few months on the issue of offshore petroleum drilling and revenue distribution thereof to the states. But unless she moves in a direction new to her, Democrat Sen. Mary Landrieu will lose bragging rights on this issue to her main competitor Republican Rep. Bill Cassidy.

For her three terms, Landrieu fairly consistently has supported measures not to restrict and to expand this activity. It is a crucial part of her strategy to make a conservative voting public in Louisiana think she is not as liberal as her record indicates. With a lifetime American Conservative Union score barely above 20 (through 2012, where 0 is an unblemished liberal record and hers is about half as high as the chamber average), her tactic always has been to highlight the few conservative issue preferences she articulates and bring the state more money while hoping the mass public ignores the rest of her record.

This issue has been one of the ones on which she can appear to be compatible with the satte’s majority, and so in March she signed on as a co-sponsor to Sen. Lisa Murkowski’s S. 630, which speeds up the timeline for coastal states already with offshore production to receive more in royalties from that, allows for a higher amount to be received, and would increase incentives for other states to enter into offshore production. Yesterday, hearings on the bill commenced with Pres. Barack Obama, with whom she has voted 97 percent of the time where he has issued a preference, administration officials providing a nice foil for her reelection efforts by testifying against the bill, saying it would detract funding going into research on alternative energy sources. She and supporters have argued that coastal states even after the increase begins in 2017 still don’t get their fair share of royalties and other related revenues; inland states have gotten 50 percent of funds going to the federal government from this for nearly a century.

There is a bit of apples and oranges comparison going on here. States, unless the extraction occurs on federal land, are responsible for oversight of the territory on which it occurs if in the interior, while states have essentially no responsibilities offshore, which are left to the federal government, so a case can be made that the proportion going to states should be lower, perhaps considerably so. Then again, a good chunk of this money will be required to go to coastal restoration efforts, whereas revenues from land sources have no federal strings attached.

Still, adding it all up, coastal states are probably getting the short end of the stick relatively speaking, and some boost is in order, even if not of the magnitude in this bill. But Cassidy stole a march on Landrieu weeks ago when he got an amendment slapped onto a House bill to increase revenue sharing, although not bumping up the commencement date nor eventually removing the cap and starting that increase later. Without a cap, even as the rates of 37.5 percent remain the same in both bills and the existing law, the possibility is there for the amount for the Senate version to spool more revenue to Louisiana’s than the House version …

… except that Landrieu’s version cuts that back to 27.5 percent by diverting 10 percent into mandated state-established funds “to support projects and activities relating to alternative and renewable energy, energy research and development, energy efficiency, or conservation” – corporate welfare to these industries representing an absolute boondoggle. It also means that for Landrieu’s version to produce more usable royalties than Cassidy’s for coastal states, production off that state’s coast would have to be about $1 billion higher a year. The current rate of production and royalty schedule allows for Landrieu’s version for Louisiana to be higher – if that combination holds in the future.

Cassidy’s version has the advantage of passage already, but Obama has declared he would veto the entire bill. Meanwhile, Landrieu’s looks even less likely to go that far with White House opposition. The Senate leadership of Democrats also probably will insulate her by making sure the House bill never comes to a vote, in order not only to keep the bill at bay but also not to force her to support a measure her opponent inserted. Instead, she can fall back on her own stifled attempt as a show of policy leadership.

At the same time, this approach degrades her “independence” argument from Obama relative to Cassidy and even damages a corollary argument she has been making about her “indispensability” – that her seniority enables her to steer an independent course and get things done like this revenue enhancement for Louisiana. That her bill, even as it shows good intentions, will go nowhere falsifies that claim, and actually makes Cassidy look better because his made more progress. And, with the embargo on his version this reinforces the fact that Cassidy is not just an opponent lite of Obama like Landrieu; he’s the real deal and thus encourages the majority in Louisiana, who dislike Obama, think why it should trust Landrieu to oppose him when Cassidy genuinely does so far more often.

Therefore, on this issue only if Landrieu demonstrably presents a better bill than does Cassidy can she gain politically on him. That’s done only by assuring the state gets more out of her version under any condition, which means scrapping the 10 percent diversion to special interests, its presence a point Cassidy should drive home to show he has a better idea. This also would mitigate claims of her Obama boot-licking, maximally contrasting against the exact reason the Administration opposes the bill. Absent that, she loses on this. And she can’t afford to with so few issues out there on which she can make a legitimate claim to be at least as close to the state’s majority as Cassidy is.