On a party-line rollcall of 246-171, the House voted to send the Senate a bill to reauthorize the Commodity Futures Trading Commission. It would create new safeguards for customers’ money and ease regulation of so-called end users.The customer safeguards are a reaction to the collapse of two large trading houses and are intended to preserve customers’ accounts during financial upheavals. Agriculture Committee chairman Michael Conaway said, “The fact is, no end user played any part” in the financial market distress that led to the 2008 recession, so there was no danger in relaxing regulation of “end users,” who rely on swaps and futures contracts to guarantee a supply and set the price for raw materials used in manufacturing, food processing and power plants.
The White House has threatened to veto the bill on grounds it would hobble the agency, which oversees the futures markets, and does not assure adequate funding for it. Only nine House Democrats voted for the bill, including four members of the Agriculture Committee – Brad Ashford of Nebraska, Jim Costa of California, David Scott of Georgia and Gwen Graham of Florida.
Rep. Collin Peterson, the Democratic leader on the Agriculture Committee, opposed the bill because it would alter the CFTC’s internal operations. “This is, in my opinion, all cost and no benefits,” he said. The bill would put more burdens on CFTC in drafting regulations, including a more stringent cost-benefit analysis. Peterson said the new procedures would invite lawsuits to delay CFTC regulations. Conaway said the bill would “make narrowly targeted changes.”