April 28, 2013

Program begun in blimp era is hard to cut

Many wish to see the Federal Helium Program end, but what about ensuing shortages?

By DAVID A. FAHRENTHOLD/The Washington Post

President Ronald Reagan tried to get rid of it. So did President Bill Clinton. This October, their wish is finally set to come true.

R-101 DIRIGIBLE
click image to enlarge

Dirigibles were in demand around 1930, when this one was photographed. A government reserve of the helium that is used to fill them is still maintained today.

The Associated Press

The Federal Helium Program - left over from the age of zeppelins and an infamous symbol of Washington's inability to cut what it no longer needs - will be terminated.

Unless it isn't.

On Friday, in fact, the House voted to keep it alive.

"Many people don't believe that the federal government should be in the helium business. And I would agree," Rep. Doc Hastings, R-Wash., said on the House floor Thursday.

But at that very moment, Hastings was urging his colleagues to keep the government in the helium business for a little while longer. "We must recognize the realities of our current situation," he said.

The problem is that the private sector has not done what some politicians had predicted - step into a role that government was giving up. The federal helium program sells vast amounts of the gas to U.S. companies that use it in everything from party balloons to MRI machines.

If the government stops, no one else is ready. There are fears of shortages.

So Congress faces an awkward task. In a time of austerity, it may reach back into the past and undo a rare victory for downsizing government.

"If we cannot at this point dispense with the helium reserve - the purpose of which is no longer valid - then we cannot undo anything," then-Rep. Barney Frank, D-Mass., said back in 1996, when Congress thought it finally killed the program.

Today, the program is another reminder that, in the world of the federal budget, the dead are never really gone. Even when programs are cut, their constituencies remain, pushing for a revival.

Two other programs axed in Clinton's "Reinventing Government" effort - aid to beekeepers and federal payments for wool - returned, zombielike, a few years later. Now the helium program may skip the middle step and be revived without dying first.

"This sort of feels like the longest-running battle since the Trojan War," said Sen. Ron Wyden, D-Ore. He has written a Senate bill, similar to the one Hastings wrote in the House, to extend the helium program beyond October and then eventually shut it down.

This time, the shutdown would happen, Wyden said. "I intend to watchdog this very carefully," he added.

The program at the center of this debate has its origins after World War I, in a kind of arms race that sounds ridiculous now. In Europe, countries such as Germany were building sturdy, if slow, inflatable airships. The U.S. military was worried about a blimp gap. So Congress ordered a stockpile of helium to help American dirigibles catch up. It was assumed to be a temporary arrangement.

"As soon as private companies produce [helium], the government will, perhaps, withdraw?" asked Rep. Don Colton, R-Utah, in the House debate.

"That is correct," said Rep. Fritz Lanham, D-Texas.

That was in 1925.

Today, 88 years later, the zeppelin threat is over. Private companies have learned to produce helium. But the U.S. government still has its own reserve: a giant porous rock formation under the Texas Panhandle, whose crannies hold enough helium to fill 33 billion party balloons.

The reserve sells off portions of its helium every year, accounting for about 42 percent of the U.S. supply of the unrefined gas. The program, with 52 employees, pays for itself with proceeds from the sales.

But since the 1980s, politicians have been saying this shouldn't be the government's job. Reagan said so in his 1988 budget. Clinton said so in his 1995 State of the Union speech.

Finally, in 1996, Congress passed a law that said it wouldn't be. The law required the reserve to sell off helium until it had paid off a more than $1 billion debt to other agencies. Then its time would be up.

Time is up. The debt will be paid off soon, although the program has about five years' worth of helium in the ground.

And that looks less like a victory and more like a disaster.

"All of a sudden, you basically take away 40 percent of the supply" of helium, said Moses Chan, a professor at Pennsylvania State University and a de facto spokesman for scientists who use helium in their research. The gas is valuable in labs because it is stable at very low temperatures. "That would just be chaos."

In recent weeks, Congress has heard a chorus of such worries. MRI machines and semiconductor plants, which both rely on helium, might be affected. And yes, balloons might cost more.

There is an argument about how this happened.

Congress says private industry simply didn't step up to supply more helium, in part because the federal government was selling its helium so cheaply. In industry, it's said that there has been a spike in demand for helium, and that finding new supplies isn't easy. That requires drilling in a certain kind of natural gas field, where helium comes up along with the gas.

All sides, however, seem to agree on the solution.

The helium program can't die.

Both bills in Congress seek to alter the program as they save it, to raise more money by selling the gas closer to market price. And both anticipate closing down the reserve. They are confident the private sector will be ready soon. There is hope in particular for a new helium plant going online in Wyoming.

So, how much longer will it take?

"Five years? We don't know," Hastings said in a telephone interview. "It could be shorter than that. It could be longer."

 

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