Do-Nothing Regulators Branded as Outlaws
U.S. Sen. Bernie Sanders (I-Vt.) said Thursday he will introduce legislation to force federal regulators to curb unbridled speculation in crude oil markets that experts blame for driving up gasoline prices.
"We cannot allow Wall Street speculators to continue to rip off the American people at the gas pump any longer," Sanders told a press conference at his Senate office.
Sanders accused the Commodity Futures Trading Commission of flouting a law that required the regulators to impose new limits on speculators by January. "In other words," the senator said, "the chief regulator on oil speculation, in my view is breaking the law."
Sanders cited mounting evidence that the sky-high price of gasoline - $3.88 a gallon in Vermont, a dime more than the national average - has nothing to do with the fundamentals of supply and demand and everything to do with speculators. He noted that the supply of crude oil in this country is higher today than two years ago while demand for gasoline is lower. He cited recent testimony by Exxon Mobil CEO Rex Tillerson and a report by the investment firm Goldman Sachs that speculation is responsible for 20 percent to 40 percent of the recent spike in oil prices. The senator also pointed to a report today that credited the booming oil market as a money maker for big banks.
Sanders last week summoned Gary Gensler, chairman of the commission that regulates commodities markets, to meet with him and six other senators in Washington. The lawmakers wanted to know why the commission thumbed its nose at the provision on speculation in last year's Wall Street reform law. The law required the commission to impose strict position limits by Jan. 17. Today, more than four months later, the commission still has not imposed speculation limits.
Gensler's "lack of urgency" prompted Sanders to draft new legislation that he will introduce when the Senate returns to Washington next week after a Memorial Day recess.
"The skyrocketing cost of gasoline is causing severe economic pain to Vermonters and millions of Americans who have already suffered through the worst economic crisis since the Great Depression," Sanders said. "Increased gas prices are taking a serious bite out of the paychecks of middle-class Vermont families, many of whom are already working longer hours for lower wages. We have a responsibility to do everything we can to lower gas prices so that they reflect the fundamentals of supply and demand and bring needed relief to Vermonters at the gas pump."