Rep. Frank Lucas, Chairman of the House Agriculture Committee, today issued a statement in response to the Commodity Futures Trading Commission's (CFTC) surprise "advisory notice" to further regulate cross-border swaps.
In Case You Missed It: House Democrats Urge Support for End Users
Tamara Hinton (202) 225-0184
WASHINGTON – House Democrats from the Agriculture Committee, the New Democrat Coalition, the New York Delegation and others have written letters to Conferees in the past week expressing support for the House-passed derivatives title. This comes as Conferees prepare to debate the derivatives title at Conference.
Today, Rep. Frank Lucas, Ranking Member of the House Agriculture Committee and Rep. Scott Garrett, Ranking Member of the Financial Services Subcommittee on Capital Markets, Insurance and Government-sponsored Enterprises, will offer an amendment that would strike the House offer of Title VII in its entirety and insert Title III of H.R. 4173, which was passed with bipartisan support by the House last December.
In a June 21, 2010 letter, 21 Democrat members of the House Agriculture Committee wrote:
"As members of the House Agriculture Committee, we write to express our strong support for the House-passed reforms of the derivatives markets that will reduce systemic risk to the financial system and provide clear protections for end users such as manufacturers, electric utilities, and community banks that use derivatives to responsibly manage their business exposures.
"...we urge you to support the House-passed derivatives provisions in Conference, which are critical to job growth and will help to put our economy back on track."
In a June 17, 2010 letter, members of the New York Delegation of Congress wrote:
"The House-passed language, requiring the use of exchanges or clearhouses for derivatives trades, is far more pragmatic than the Senate's approach and more sensibly addresses one of the major regulatory deficiencies that led to the near-collapse of our financial system in 2008.
"...we ask that you strongly advocate for the House-passed derivatives language during the conference with the Senate on H.R. 4173."
In a June 16, 2010 letter, members of the New Democrat Coalition wrote:
"The House also provided clear protections for end users who pose no risk to the stability of the financial system so they may continue to use derivatives to prudently manage their risks. Whether they are being used by a rural electric cooperative looking to hedge against spikes in energy inputs, an airline protecting itself from rising fuel costs, or a community bank guarding against interest rate fluctuations for loans, derivatives play an important role in reducing risk in our commercial sector, and keeping prices stable and low for customers"
In a June 18, 2010 letter, members of Congress wrote:
"...we...urge you to ensure that a strong commercial end-user exemption is retained through the Conference negotiation process for the financial regulatory reform bill. It is critical that the exemption is carefully crafted to ensure that commercial end-users are able to utilize the exemption, it is equally important that commercial end-users can actually utilize the exemption so that these businesses can contineu to manage risk and operate their businesses during these difficult economic times."