By David Kurlander
House Speaker Nancy Pelosi on Tuesday aimed to reframe the often-rancorous Democratic debate over President Biden’s tax-and-spending package: “Whatever we do we will make decisions that will continue to be transformative.” On this week’s Now & Then episode, “Speakers of the House: Velvet Gloves and Iron Fists,” Heather Cox Richardson and Joanne Freeman compared Pelosi’s leadership to the work of past Speakers, zooming in on Speaker Tip O’Neill’s ten-year run during the Carter and Reagan administrations. “O’Neill is someone who maneuvers really well within party politics of both parties…he brings people together and he reminds people of the institution’s history, their own history, what they want,” Joanne said. O’Neill’s unique skills were never more on display than in the summer of 1977, when he guided President Jimmy Carter’s controversial National Energy Plan through the House.
On April 18th, 1977, Carter delivered a primetime Oval Office address to introduce his energy policy. The President, in office less than three months, presented a sweeping legislative vision. He aimed to cut oil imports by 50% and gas consumption by 10% by 1985. To accomplish these reductions, Carter suggested the creation of a one billion barrel strategic petroleum reserve and pushed rebates for Americans who insulated their homes or installed solar panels. The plan even called for a tax on Americans who “insist on driving large, unnecessarily powerful cars.”
Carter framed his complicated set of action items in near-mythic terms: “Our decision about energy will test the character of the American people and the ability of the President and the Congress to govern this nation. This difficult effort will be the moral equivalent of war.”
Carter came into the presidency in the midst of a brutal winter that so badly depleted natural gas supplies that he had to propose emergency legislation to redirect gas to hard-hit communities during his first days in office. The shortage, combined with the memories of the OPEC oil crisis of 1973, spurred Carter to take an aggressive posture. Carter appointed James Schlesinger, the pipe-smoking Washington mainstay who had served a rocky tenure as Nixon and Ford’s Secretary of Defense, as his main energy advisor. Schlesinger, Carter, and a coterie of economists and lawyers set to work.
The package that Carter’s team sent to Congress on April 20th, 1977, just two nights after his dramatic address, was labyrinthine: 113 distinct proposals, and five separate bills.
The person tasked with sorting out Carter’s megillah was the new House Speaker, Tip O’Neill. O’Neill recalled in his 1987 memoir Man of the House his thought process when he first saw the plan. “Forget it, I thought, as I leafed through the five volumes of legislation, each one the size of a telephone directory.”
O’Neill assumed the Speakership at the start of the 95th Congress, weeks before Carter’s inauguration. He had been in the House since 1952, when he took John F. Kennedy’s seat. “They’re different sorts of folks, a rural Southern Protestant outside the system, and an Irish Catholic from Boston who has come up the way you’re supposed to come up,” said Jimmy Carter’s Press Secretary Jody Powell, comparing Carter the outsider and O’Neill the consummate pol in a June 1977 New York Times profile on the two leaders.
The Carter administration and O’Neill hadn’t gotten off on the best foot. First, the administration gave the Speaker bad seats to the Kennedy Center Inaugural Gala (O’Neill blamed young Carter aide Hamilton Jordan, who he dubbed “Hannibal Jerkin”). Then, Carter decided in March to review 19 major water-development projects that were central to O’Neill’s system of patronage and exchange.
O’Neill understood, however, that the energy program transcended any personal quibbles. He feared, however, that the sheer complexity of the bill would divide House Committees and regional interests against one another. “The only way to score on this play,” he wrote in his memoir, “was to make an end run around the existing committees of jurisdiction, and the only way to do that was to create a whole new committee just for this bill.”
O’Neill did just that. He appointed 12-term Ohio Democrat Thomas “Lud” Ashley, a neutral figure in the energy field, to head a 40-member ad hoc energy committee. Ashley had helped orchestrate the 1975 bailout of bankrupt New York City and had somehow gained the reputation of being both pro-labor and pro-banking. His new group would not initiate legislation, but would help organize and amend the disparate proposals into a single bill as pieces came back from other committees. “His talent was like a light hidden under a bushel, and when it came to the surface, it shone brilliantly,” O’Neill wrote of Ashley’s leadership.
Ashley was joined on the ad hoc committee by 26 Democrats and 13 Republicans, including some outright opponents of the legislation, a part of O’Neill’s larger strategy. “I was especially concerned about Joe Waggoner of Louisiana. He was one of the leading conservative Democrats in the House, and I knew he’d be a tough adversary. But if I put him on the committee, he’d have to play ball. I did—and so did he,” O’Neill wrote.
O’Neill set a deadline of July 13th for each committee to finish their work, which they would then pass on to Ashley and the rest of the ad hoc committee for amendments. O’Neill set a full House vote for the first week of August.
Michigan Representative John Dingell, who played a central role in O’Neill’s wrangling as chairman of the House Commerce Subcommittee on Energy, complained about the rushed timing. The Wall Street Journal reported O’Neill’s scolding of Dingell: “John, you know when I was speaker of the Massachusetts House and told a committee chairman to report out a bill by a certain date, if he didn’t, I’d have a new chairman the next day. That’s the power of persuasion.” With a smirk, O’Neill clarified. “I don’t have that power here.”
June and July saw tense committee negotiations. The Ways and Means Committee watered down Carter’s “gas guzzler” tax on fuel-inefficient vehicles. When Democratic Pennsylvania Representative Austin Murphy threatened to publicly condemn a gas tax, O’Neill called him and told him, in no uncertain terms, to “be a team player.” The Committees reported their relevant sections of the package to the ad hoc committee on schedule.
Over the next ten days, the ad hoc team added further amendments. Most amendments were relatively smooth and debated with a fair degree of civility; Democratic Maryland Representative Barbara Mikulski, for example, offered an amendment providing $65 million in federal funds to help local governments install insulation.
On August 3rd, however, a decidedly wonky crisis emerged over natural gas prices. Texas Democrat and energy industry ally Robert Krueger offered an amendment that would have fully deregulated natural gas.
Carter had asked for the continuation of moderate federal price controls over the increasingly scarce resource, believing that deregulation—even if it spurred further exploration by energy companies—could hurt American consumers. Krueger’s more aggressive and pro-business approach alienated consumer advocates and put the entire package in danger.
Amid fierce debate, O’Neill emerged to deliver a passionate and rare floor speech, blaming oil industry advocates for the deregulation push: “Never have I ever seen such an influx of lobbyists in this town as from big oil on this amendment,” he boomed. “Believe me, the future of America in 1985, the economy of this country, the defense of this Nation, are at stake. This is at the heart of this bill.”
O’Neill’s gambit worked. The Krueger Amendment was narrowly defeated and the entire package passed the House on August 5th by a vote of 244-177.
Unfortunately for Carter, the Senate had no Tip O’Neill. Senate Majority Leader Robert Byrd was lukewarm on the entire energy package, and internecine fighting kept the bill in limbo until November 1978, almost a year and a half after O’Neill’s triumph. In an ironic twist of fate, the Senate even put full natural gas deregulation back into the bill.
Still, for a brief moment in August 1977, O’Neill’s swift organization and last-minute improvisations likely saved the entire proposal.
On November 9th, 1978, Carter finally signed the package, by then known as the National Energy Act of 1978, into law. Carter asked O’Neill to say a few words. The Speaker obliged with typical verve: “Because of the diversity of ideas and because of the parochialness of the problem of energy, we did have a struggle. But with your great leadership, Mr. President, the Congress of the United States enacted this bill. And I think it augurs well for the country, for the democracy for which we stand for, the Congress, and the world itself.”
Ad hoc committee leader Ashley was slightly more tart: “I have got to be candid with you. I hope you never send us a legislative package like the number you did on us last April.” Carter promised that he would not.
Speaker Pelosi today faces a similarly complicated legislative challenge. As she continues to navigate disagreements within her own party and a hostile opposition, her determination, timing, and theatricality, like O’Neill’s, has the chance to make the difference.
For more on the House’s 1977 debates over Carter’s energy plan, read the Congressional Quarterly Almanac’s decidedly complicated but ultimately illuminating year-end retrospective on the debate.
To receive Time Machine articles in your inbox, sign up to receive the CAFE Brief newsletter sent every Friday.
Catch up on the Time Machine’s deep dives into history, which offer context to understand our present challenges, including these recent pieces:
