This is a rush transcript from "Hannity & Colmes," June 16, 2008. This copy may not be in its final form and may be updated.

ALAN COLMES, CO-HOST: Despite news the Saudi Arabian government agreed to a slight increase in production, oil briefly hit an all-time high at $140 a barrel before coming back down to about $134. So will the Saudi relief help? Or are the problems really right here at home?

Joining us now, Florida Congressman Connie Mack and California Congressman Adam Schiff.

Video: Watch the debate

Congressman Mack, let me ask you about what Dick Morris is saying, that the reason it's $150, as opposed to $70 or $80, because of commodities. You've got to stop speculators from being able to speculate on oil. Once you stop that, you can bring it down to more natural levels. It's not about supply and demand, in terms of how high it is.

REP. CONNIE MACK, R-FLA.: Well, certainly it is about supply and demand, and I believe what we need to do is take a serious look at what we can do here in the United States, whether it's build new refineries, look at nuclear power and drilling either off the coast of Florida or in Alaska.

None of these things are being addressed by this Congress. The Democrats need to be bold, need to bring bold ideas to the front, and they're just not doing that.

COLMES: Well, you blame the Democrats. John McCain is against drilling in a number of places, including Anwr. He's gone back and forth on a couple of locations, but he wouldn't drill in Anwr either.

MACK: Well, look, I think the delegation here in the Congress supports drilling in Alaska. The Alaskan legislature supports it, and the people of Alaska support it. And they — they have their say.

In the state of Florida I would vote today to lift the moratorium, but as long as the state of Florida has a say, like Alaska does. We need to go and get more domestic oil out of the ground.

COLMES: Well, you've got Republican running — you've got Republicans in Florida. You've got McCain. They don't want to drill there.

Adam Schiff, you've got the joint economic committee that says it would take ten years for ANWR to get online, reduce gas prices maybe by a penny a gallon by 2018 and by 2025, less than 1 percent of the world's production is all it would be. So it's pretty negligible what that would really accomplish.

REP. ADAM SCHIFF, D-CALIF.: Well, I think that's right. We could, as you say, develop all of Anwr, and it would take us ten years. And it wouldn't have much effect on price.

The problem is, we can't drill our way out of this. We — even if we developed all of Alaska, off all of our coastline, if we drilled Yellowstone, we would still only have about 1 to 2 percent of the oil — of the world's supply of oil, but our demand is about 25 percent.

There's no way we can drill our way out of this problem. We have to reduce demand, which is why I think we need an Apollo-Project-like effort to try to wean ourselves off of fossil fuels...

SEAN HANNITY, CO-HOST: Congressman...

SCHIFF: ... develop new technologies and try to deal with the demand side of the problem.

HANNITY: I'm driving a Chevy Tahoe hybrid. I'm all in favor of new technology. But we have more — do you read Investors Business Daily? We have more oil than all these Middle Eastern countries combined, if only we tapped the resources. If you increase supply and the demand stays stable, you lower the price.

I want to ask you a question, though: 15 percent of the price of a gallon of gasoline, Wall Street Journal reports goes to taxes. Only four percent goes to these oil companies.

And you say on your — your Web site you want to look at the record oil prices and profits of these oil companies. Why don't you look after yourself and the government that taxes us? You don't explore. You don't extract crude. You don't refine it. And you don't deliver a product.

Why do you get more money than these evil oil companies? And why do you go after them?

SCHIFF: Well, the reason that I would go after the tax benefits we're giving the oil industry, Sean, is they don't need those tax benefits. They were enacted a few years ago, and now the industry is at record profits. I don't think they need corporate welfare.

Rather, I would provide those same tax breaks, the same amount, so we're not talking about increasing the tax load. We're talking about shifting those tax benefits to the solar industry, to geothermal, wind energy.

HANNITY: Can I say something, though?

SCHIFF: Shift it to those industries that we want to incentivize, Sean, because...

HANNITY: As respectfully as I can...

SCHIFF: ... if we're going to wean ourselves off of fossil fuel, we've got to develop alternatives.

HANNITY: As much as you say the oil companies that explore, extract, refine and deliver a product and get less money than the government does, I would argue government doesn't need the money either. So maybe you can give back the money.

But I want to ask one question of Connie Mack.

SCHIFF: Sean, what I'm saying is — I'm saying that don't have the government keep the money. Take those tax benefits that were giving...

HANNITY: No, give back our tax money.

SCHIFF: Give those — give those same — give those same tax benefits that we're giving the oil industry to solar, to wind, to the other industries.

HANNITY: Will you support cutting — will you support eliminating the federal gas tax?

SCHIFF: No.

HANNITY: No, of course not.

SCHIFF: Because we need it to continue to build our roads and bridges. Sean, you might remember we had a tragic bridge collapse, and we talked about all of the infrastructure needs that we have in the country. We could remove...

HANNITY: Then go after the oil companies, not the government's. The government gets its take.

SCHIFF: ... all the federal taxes — Sean, we could remove all of the federal taxes...

HANNITY: All right. We've got to run.

SCHIFF: So we could remove all of the federal taxes...

HANNITY: Guys, I'm out of time.

SCHIFF: ... on gasoline and still not affect price.

HANNITY: Congressman Mack...

SCHIFF: Except continue to expand oil industry profits.

HANNITY: I promise we'll have you back. We did shortchange you.

(CROSSTALK)

MACK: ... anything to reduce...

HANNITY: All right. I promise we'll have you back.

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