The Government Program that Presidents Can’t Get Rid Of

Monday, April 29, 2013
(graphic: Florists' Review Magazine)

A world without helium-filled party balloons was averted Friday when the House of Representatives voted, 394 to 1, to save the Federal Helium Program from certain destruction. Although virtually every member of Congress, like Presidents Ronald Reagan and Bill Clinton, wants to shut down the helium program, the failure of the private sector to take steps needed to replace the program’s helium on the market has kept it alive. 

 

Originally passed in 1925 as a temporary answer to an alleged “helium gap” between the U.S. and European powers like Germany—at a time when military leaders believed that zeppelins or blimps filled with helium would have a decisive military role in the future—the Federal Helium Program is run by the Bureau of Land Management in the Department of the Interior with facilities centered in northern Texas and southwestern Kansas.

 

The program operates a helium storage reservoir and sells crude helium gas to private companies, accounting for about 42% of the U.S. supply. The program, which has only 52 employees, pays for itself with proceeds from the sales, so the budget deficit is not an issue.

 

Since 1996, when Congress passed the Helium Privatization Act in an effort to phase the program out of existence, the program has been required to apply excess revenue from gas sales to pay off more than $1 billion of debt to other agencies. The Act mandated that when that debt had been retired, the program would cease to exist and the private sector would step in to replace its 42% share of the market. 

 

Because its debt will be paid off in full this year, the program is slated to end, but the failure of private helium producers to prepare for the change has led to realistic fears of helium shortages and high prices. Because helium is used in a number of high-tech applications, including MRI machines, semiconductor plants and scientific research, the economic impact is also of concern.

 

And thus the spectacle arose of the House of Representatives voting overwhelmingly to save a program almost none of its members actually support.

-Matt Bewig

 

To Learn More:

Congress Finds it Hard to Let Federal Helium Program Run out of Gas (by David A. Fahrenthold, Washington Post)

The Federal Helium Program (Bureau of Land Management)

Comments

The One True Dave 3 years ago
"Because its debt will be paid off in full this year, the program is slated to end, but the failure of private helium producers to prepare for the change has led to realistic fears of helium shortages and high prices." Actually, capitalism being what it is, I have no doubt that many private helium producers are COUNTING ON shortages and high prices.

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