Commodity End-User Relief Act

Floor Speech

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Mr. VAN HOLLEN. Mr. Chair, just yesterday, I signed a letter with five other Ranking Members on this side of the aisle in opposition to this poorly conceived Commodity Futures Trading Commission (CFTC) Reauthorization bill--which is also opposed by the Obama Administration, CFTC Chairman Massad, and a whole host of consumer groups.

For those who aren't familiar with it, the Commodity Futures Trading Commission (CFTC) has a very important job: it regulates the futures and options markets in the agricultural sector, including commodity-related derivatives. While there's no question that the appropriate use of these financial instruments can help farmers and commercial end users hedge their commercial risk, recent history clearly demonstrates that the unregulated abuse of these kinds of products can distort markets, hurt consumers and put our entire economy at risk. The CFTC's authority was allowed to expire in 2013, so its reauthorization is long overdue. Having said that, today's legislation has multiple major defects. I will briefly describe three.

First, Title II of H.R. 2289 imposes new bureaucratic requirements on an agency whose activities are already governed by the Commodity Exchange Act, the Paperwork Reduction Act, the Congressional Review Act, and the Regulatory Flexibility Act. With all due respect, the bureaucracy does not need more bureaucracy. In this case, it simply needs to do its job policing our financial markets. If enacted into law, Title II of this bill would undermine the CFTC's ability to do its job and subject the commission to unnecessary and costly litigation risk.

Second, Title III of H.R. 2289 requires a complex new rulemaking for our international derivatives markets. While I support the goal of harmonizing global rules in this area, this provision of the bill interferes with the CFTC's ongoing negotiations to achieve that objective and instead substitutes and attempts to predetermine the majority's preferred outcome for those negotiations. In my judgment, the CFTC should be allowed to complete its negotiations unfettered by the dictates of this legislation.

Finally, the non-partisan Congressional Budget Office estimates that all of the additional requirements placed on the CFTC by this legislation will require 30 new employees at a cost of $45 million over the next five years--a cost this bill does not even attempt to pay for. Moreover, an amendment to permit the CFTC to collect user fees to close that gap and help pay for the CFTC's operations was not even afforded the opportunity for an up or down vote on the floor of the House today.

Mr. Chair, the reauthorization of the CFTC is an important subject, worthy of a far more thoughtful bill than we are being asked to consider today. I strongly urge a no vote, and I yield back the balance of my time.

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