Ignoring President Reagan's express desires, Congress has sent him the Standby Petroleum Allocation Act of 1982, challenging him to veto it.
The lobbying battle set off by passage of the conference report on the bill pits Republican against Republican, oil company against oil company and has other traditional allies of Reagan, including farmers, lined up against the veto. It also presents the possibility that if the president vetoes it, he could be sustained in the Democratic House and overridden in the Republican Senate.
What the bill does is authorize the president to allocate supplies of crude oil and other products in a severe petroleum supply shortage. The bill leaves it totally up to the president whether to turn to allocation and price controls, but requires that regulations be drafted in advance.
It is, according to its supporters, a bill that imposes so little burden on the president that there is virtually no reason not to sign it. But opponents say that signing it would be a major abdication of the president's role as champion of the free market and decontrol.
A conference report on the bill passed the Senate and the House by large margins the first week of March. In spite of those margins (86 to 7 in the Senate and 246 to 144 in the House), supporters of a veto believe that the House would sustain the veto. It would be only the third veto of the Reagan adminstration.
In favor of a veto are policy makers within the administration, including the secretary of Energy and the assistant secretary in charge of emergency preparedness; House Republican leaders; large industrial users and others such as the Holiday Inn chain, and some of the smaller oil companies with domestic reserves, including Marathon Oil Co. and Cities Services Inc.
Opposing a veto are some of the major oil firms, farm groups, the National Governors Association, food processors, truckers, some refining groups and independent gasoline retailers, and Senate Republicans, including the chairman of the Senate Energy and Natural Resources Committee, James A. McClure (R-Idaho).
"Basically, the people who favor the bill are people who feel they will do better in the political process than they would in the market," said one observer of the lobbying.
President Reagan, who has until the end of next week to decide whether to maintain his philosophical opposition to allocation and price control authority and veto the bill, has scheduled a meeting with McClure and Republican Senate Majority Leader Howard Baker to discuss the bill late Thursday. On Friday the president is scheduled to be out of town, so action on the bill may come that same day.
"I'm confident from both the original vote in the House and the vote on the conference report that a veto is sustainable," said William A. Vaughan, assistant secretary of the Department of Energy for environmental protection safety and emergency preparedness, who lobbied in Congress against the bill and has been among the strong voices in the administration urging a veto.
"The president recommending a veto be sustained , and only the third one of his administration, has more claim than the subject matter," he said. Republican head-counters say that 12 of the original votes against the bill were absent when the conference report was passed and that another 25 members who voted in favor of the bill have said they will back up the president on a veto. To sustain a veto requires 145 votes if all members are voting--or only one more vote than the number of House members who opposed final passage.
Another factor that might win votes in favor of a veto is that it would give members who feel they must oppose the president on other issues, such as the budget, a chance to demonstrate their loyalty.
In the last two weeks, there has been a flurry of meetings and letter-writing as different interests have sought to woo the president to either sign or veto the bill.
"We're asking you to accept this legislation not because it meets all the requirements for a good bill but because, on the balance, its advantages outweigh its shortcomings," Mobil Corp. Chairman Rawleigh Warner wrote Reagan two days after the House adopted the conference report. Warner argued that, unless federally pre-empted, states would adopt controls and that "chaotic conditions can arise in a number of states as they attempt to intervene against the forces of the market."
The National Governors Association, which is asking governors to call or send telegrams to the White House urging the president to sign the bill, has made similar arguments--that a federal program is better than a patchwork of 50 state programs. The bill contains a provision that would allow the states to request that up to 5 percent of the oil or refined petroleum product supply be set aside to be administered in a state-run program.
Still another argument advanced against the bill is the invocation of unhappy memories of the Emergency Petroleum Allocation Act, which expired in September, and under which oil supplies were allocated and price controls were imposed in the '70s.
Opponents and supporters of the bill met with White House political advisers last week to argue their positions. The word from those who hope Reagan will sign will probably be from McClure, who has been assured that he will be given a chance to argue one more time in favor of the bill before any action is taken.
A veto would be "a major embarrassment to McClure," said Jack Blum, general counsel for the Independent Gasoline Marketers Council, one of the groups that favors the bill. "It would be sort of like kneecapping their chairman."
McClure said he expects to have a fair shot at persuading the president. Besides the chaos that would result from 50 state programs or a program devised at the last moment in the middle of a crisis, Reagan's advisers should consider the political realities, McClure has said.
If there is a shortage and no system in hand for allocating scarce supplies, "it won't be the eastern liberal Democrats hearing the screams of pain, it will be the conservative rural Republicans," according to McClure.