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On behalf of hundreds of thousands of FreedomWorks members nationwide, I urge you to vote “No” on H.R. 6604: the Commodity Markets Transparency and Accountability Act. The bill states that its purpose is “to amend the Commodity Exchange Act to bring greater transparency and accountability to commodity markets” but the consequences of the legislation are greater intervention in markets and an expansion of government into the reach of private contracts.
H.R. 6604 is a premature action by Congress to pin the current energy problem on commodities future traders rather than address the real problem of supply even before the scheduled September 15 report by the Commodity Futures Trading Commission (CFTC) on oil and gas futures and whether price manipulation exists. It would behoove legislators to wait for the findings of this report before enacting legislation that would significantly alter how an entire market operates.
Futures markets are price discovery mechanisms that allow investors, traders, and even major energy consumers like refineries and airlines, to lock in goods at a future price, as a hedge against volatility – in effect protecting themselves and stabilizing the market. Current law already gives the CFTC the authority to rein in “excessive speculation” and futures contracts are already subject to certain position limits restricting the size of futures positions that all traders are permitted to hold, subject to CFTC-granted exceptions, making the regulations of this bill duplicative and excessive.
Higher futures prices are an important market signal that spur conservation as well as needed investment in new supplies. As developing nations grow, so does the global demands for energy. Opening hitherto untapped resources like the OCS and ANWR will, in turn, send a strong signal to these markets that in the very near future more supply will be available, bringing down prices and relieving the pocketbooks and pensions of American families.
We will count your vote on H.R. 6604 as a KEY VOTE when calculating the FreedomWorks Economic Scorecard for 2008. The FreedomWorks Economic Scorecard is used to determine eligibility for the Jefferson Award, which recognizes members of Congress with voting records that support economic freedom.