The Ranking Member of the
Specifically, the provisions would impede the
Waters will also offer an amendment to the measure that would protect the CFTC's cost-benefit considerations from frivolous and excessive litigation by special interest groups. She also supports an amendment offered by Rep.
On the House floor, Waters made the following statement:
"I rise today in opposition to H.R. 4413, legislation that would reauthorize the
This measure addresses an important goal for this
I know that Rep. Peterson and Rep. Scott, the Ranking Members of the Committee and Subcommittee, respectively, have worked in good faith to improve this legislation, and that they care deeply about making the CFTC work for farmers, manufacturers and other businesses that use futures and derivatives. I thank them for their efforts.
However, I'm concerned about provisions in the bill - unrelated to reauthorization of the Commission - that I believe would undermine the CFTC's authority and hamstring its ability to regulate a complex and important marketplace.
H.R. 4413 would also make it much more difficult for the CFTC and the
These types of derivatives transactions contributed to the massive taxpayer bailout of AIG in 2008, created enormous losses to JP Morgan in the "London Whale" episode in 2012, and brought down the hedge fund
This bill makes the job of the CFTC and the
In addition, under the guise of cost-benefit analysis, the bill imposes heavy administrative hurdles and new litigation risks on the CFTC, significantly impairing the Commission's ability to do its job of regulating our derivatives markets. Like other agencies, the CFTC already considers the costs and benefits pursuant to numerous existing laws. And unlike any other regulator, the CFTC goes even further, considering the protection of market participants and the public, the effect on futures markets, price discovery, sound risk management practices and other public interest matters.
Even the courts have weighed in - finding that the CFTC has fulfilled its duty to consider the costs and benefits.
H.R. 4413 not only burdens an agency already facing limited funding with additional administrative burdens, but it also opens up new avenues for special interests to endlessly challenge the CFTC in court. Former CFTC Chairman Gensler noted that if this provision in H.R. 4413 is enacted, "it may well be hard to get any rule out of the building."
Together, these changes undermine the CFTC's ability to guard against some of the most complex and risky activities in our financial system.
And it is all just part of a multifaceted Republican effort to undercut laws and regulations that protect consumers, investors and the economy. It also comes just a week after House Republicans proposed an appropriations measure that dangerously underfunds the CFTC at 22 percent below the President's request - a level which will lead to either agency wide closures or employee layoffs.
I urge my colleagues to oppose this legislation."
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