There aren’t many oil analysts who still deny that speculation, and the sheer volume of speculative trades in energy commodities, drives up the price of oil and gasoline. But there’s an army of financial and energy lobbyists still arguing that effective regulation of oil and other commodity trading will somehow destroy the financial industry and wreck energy producers. If the lobbyists win their campaign to wreck the intent of the Dodd-Frank regulatory bill, and they’re getting close, we can easily expect $4 a gallon gasoline this year.
Lobbyists have smothered the would-be federal regulators of the Commodities Futures Trading Commission, and opposing voices don’t have corporate sponsors. The regulators are succumbing and the White House seems to be sitting on its hands. A coherent opinion piece from the financial website TheStreet.com, by author Daniel Dicker, lays it out:
The final dam to stopping $150-a-barrel oil and $4-a-gallon gas is being breached, as financial regulation continues its daily erosion into worthlessness. …
The process of rule-making has seemed like it would be fair — propose a rule from the outline of Dodd-Frank [financial legislation] and open a forum for comment and discussion before ultimately writing and enforcing it. The problem has been the virtual avalanche of opinion that has descended on the commissioners entirely from the industry side; pretty much no one has bothered to speak for the American public — the consumer — and the industry just wants Dodd-Frank and those profit-dissolving [regulatory] proposals to go away.
It’s not quite true that there are no consumer voices. We’re part of one group, the Commodities Market Oversight Coalition, that brings together organizations from Public Citizen to wheat growers to heating oil dealers to defend reining in speculation. But we don’t have the moolah to babysit every regulator and key legislator 24/7, pouring honey into his or her ear.
What we consumer and farmer and small-biz advocates find is that some regulators and legislators who really understand the issue are sympathetic, and assure us that our detailed letters are getting read. Then the regulation gets shelved/delayed/crippled.
Even if proposed regulations that were due this month are somehow issued on schedule, there’s a likelihood that the new, more corporate-friendly Congress will try to eliminate enforcement funding.
It’s past time for the White House to directly step in and give its appointed regulators the spine to push back the lobbyists. As everyone involved knows, it’s not moral force or the greater economic good that is making the lobbyists so successful. It’s just an endless stream of corporate dollars.