House acts to penalize price gouging

WASHINGTON — The House on Wednesday approved criminal penalties and fines of up to $150 million for energy companies caught price gouging, yet lawmakers acknowledged there is no quick and easy fix to higher pump prices.

President Bush summoned Democrats and Republicans to the White House to discuss legislation to address long-term energy concerns.

"The price of gasoline should serve as a wake-up call ... that we've got an energy-security problem and a national-security problem," Bush said after the meeting.

With bipartisan support, the House approved on a 389-34 vote a measure that would create a price-gouging law and permit large fines and jail time for violators.

The Senate has yet to consider the legislation.

Debate over refineries

The House rejected a Republican bill to quicken the permit process for refineries, which supporters said would help ease tight gasoline supplies.

All but 13 Democrats opposed the measure. They said it would not bring down gas prices, could lessen environmental protection and usurp local say where refineries go.

Rep. Rick Boucher, D-Va., said the "real reason we have a refinery shortage is the companies that own refineries are profiting enormously from the ... refinery bottlenecks."

Republicans branded Democrats as obstructionists on energy. The vote, 237-188, fell short of the two-thirds needed to pass under special procedures. Rep. Joe Barton, R-Texas, a leading supporter of the refinery bill, promised to bring it back, possibly next week.

Senate Majority Leader Bill Frist's proposal to give people a $100 rebate checks was all but abandoned Wednesday, ridiculed even by members of his party as insulting and inadequate. Also seeming to lose steam was a Democratic proposal for a 60-day "holiday" from the 18.4-cent per gallon federal gas tax.

"We would like to be able to do something now, quickly. The truth of the matter is we can't," Sen. Pete Domenici, chairman of the Senate Energy and Natural Resources Committee, said after the White House meeting.

The price-gouging issue seemed to have the most potential as a congressional show of support for people angered by high gas prices.

Under Rep. Heather Wilson's bill, the Federal Trade Commission and Justice Department would have power over energy price gouging.

Guides and penalties

The legislation would direct the FTC to define price gouging. Violators could face penalties of up to $150 million for refiners and other wholesalers and $2 million for retailers. The measure would cover marketers of gasoline, diesel fuel, crude oil and heating fuel.

Wholesalers and retail outlets such as corner gas stations and service-station chains could face civil penalties triple the amount of their unfair profit. Violators could go to jail.

Bush said last week he did not think oil companies were engaging in price gouging. He said Wednesday there is a "need to make sure our consumers are treated fairly — that there is fairness in the marketplace."

The president, in talks with lawmakers, discussed proposals aimed at increasing and diversifying energy supplies, extending tax credits for the purchase of hybrid cars and encouraging alternative fuels.

Also Wednesday, the House Energy and Commerce Committee heard about the administration's request for new rules for auto-mileage requirements. Automakers would gain flexibility in meeting per-gallon standards, but overall mileage would not necessarily rise.

Barton, the committee's chairman, said he does not see Congress ordering higher mileage requirements. "A Draconian increase would be a stake in the heart ... of the auto industry in this country," he told reporters.