After the House Agriculture Committee on Wednesday approved a bipartisan bill to reauthorize the Commodity Futures Trading Commission, House Agriculture Chairman Collin Peterson, D-Minn., said the bill “sends a strong message to the Senate. The people that look to our markets for integrity don’t care about political wins and losses. They expect us to conduct the business of this committee.”
Peterson noted, “The CFTC authorization expired in 2013, so it is overdue, and I’m glad we are on a bipartisan path to get it done.” Although the CFTC has continued to function normally under appropriations bills, Peterson also said that Heath Tarbert, the new CFTC chairman, “is also keen to have his agency formally reauthorized.”
Tarbert in a press release praised the committee’s action and said, “The sound regulation of our derivatives markets, which see more than $4 trillion in notional activity each day, is critical to the health of the U.S. economy and the pocketbook of every American. These markets help inform the price of everything from food and gasoline to home mortgage interest. Today’s bipartisan action highlights the importance of the work done at the CFTC and represents a significant first step in the legislative process. I look forward to working with members of both parties in both chambers to see a bill through.”
For the most part, the bill continues the CFTC’s previous authorities, but it also reinforces its fraud authority, establishes an Office of the Chief Economist and expands the office of Minority and Women Inclusion.
House Agriculture Commodity Exchanges, Energy and Credit Subcommittee Chairman David Scott, D-Ga., noted that the bill also will establish and maintain a paid internship program for students from 1890s historically black colleges and universities, schools that serve Hispanic and Latino students, 1994 tribal colleges, and those schools that serve the territories.
The bill also contains a digital commodities section, but House Agriculture ranking member Michael Conaway, R-Texas, said, “Today’s legislation continues the important work of reauthorizing the agencies and programs in our jurisdiction, but I do want to caution that we are not breaking much new ground. This bill does not address important issues around the emerging world of digital assets, especially those digital commodities that fall within our committee’s jurisdiction.”
Three freshmen Democrats claimed credit for provisions in the bill.
Rep. Abigail Spanberger, D-Va., said in a news release that the bill contains her provision that would bring clarity to the determination of which commodity broker assets will be used to cover the costs of equity claims during bankruptcy proceedings. Specifically, the Spanberger provision would require that a commodity broker’s cash, securities, or other property be classified as customer property to help pay the net equity claims of a broker’s public customers following the broker’s bankruptcy.
“Amid widespread trade worries, the American futures market currently faces tremendous financial uncertainty. In this unstable economic climate, agribusinesses in central Virginia and across the country are always looking to better protect themselves against the consequences of unpredictable fluctuations in the market,” said Spanberger. “Today, the House Agriculture Committee passed my bill to bring more clarity to the CFTC’s commodity broker bankruptcy rules.
“By streamlining these regulations, we are giving producers more certainty as they look to expand their operations and invest in new facilities, equipment, and employees,” Spanberger said.
Peterson said in the news release that “Spanberger’s provision in the reauthorization legislation would give our country’s agribusinesses some much-needed peace of mind during bankruptcy proceedings, and I was glad to see her bill pass with strong bipartisan support.”
Spanberger noted her provision is endorsed by the Virginia Agribusiness Council and the National Futures Association.
Rep. Cindy Axne, D-Iowa, said, “This legislation includes language from my Whistleblower Programs Improvement Act, which strengthens protections for whistleblowers that report wrongdoing or violations of commodities law. We should be protecting folks that do the right thing by reporting market manipulation or fraud, not exposing them to being fired if they speak up.”
Rep. Angie Craig, D-Minn., said the bill contains her provision “to ensure that church retirement and healthcare plans are not regulated the same way for-profit corporations are — allowing churches to provide their employees with the healthcare they need and the retirement savings they have earned.”
Conaway commented, “We’ve included new protections for charitable organizations and church retirement plans so they will not be subjected to regulations designed for Wall Street, as well as ensuring the protection of customers’ hard-earned assets in the case of a commodity broker bankruptcy.”
Jerry Hagstrom can be reached at firstname.lastname@example.org
Follow him on Twitter @hagstromreport