FOR IMMEDIATE RELEASE
June 16, 2011
CONTACT: John Carey at 202-466-1854
john@ourfinancialsecurity.org
AFR Statement on House Passage of FY 2012 Agriculture Budget
Washington, DC – Americans for Financial Reform, a coalition of more than 250 national and state organizations working together for strong Wall Street reform, issued the following statement today:
Today the House Majority passed an FY 2012 agriculture budget that would cut the CFTC’s budget nearly 44% from the President’s FY 2012 budget.
Gutting the CFTC’s budget is not about saving money, it’s about protecting Wall Street special interests. Defunding the CFTC would make it impossible for the agency to carry out its mission of overseeing vital commodity markets, allowing speculators to drive gas and food prices to new heights. It would also make it impossible to implement key elements of the financial regulatory reforms passed in the Dodd-Frank Act.
The financial crisis of 2008 led to the loss of millions of jobs and trillions of dollars in wealth. The Financial Crisis Inquiry Commission has concluded that unregulated “shadow markets” in derivatives were a key cause of the financial crisis. To prevent a repeat of that disaster, the Dodd-Frank Act gave the CFTC new responsibility for oversight of approximately $280 trillion in previously unregulated domestic swaps markets. This represents a more than seven-fold increase in the notional size of the market the CFTC must supervise. The Dodd-Frank Act also directed the CFTC to regulate excessive speculation in the commodities markets, to prevent uncontrolled increases in gas and food prices. None of these critical new responsibilities could be carried out if these cuts are passed.
To take on these new responsibilities, the President’s 2012 budget request would increase CFTC funding to by only $105 million, to a total of $308 million, The small amount of extra funding necessary for the CFTC to do its job is miniscule compared to the scope and significance of the CFTC’s responsibilities and the risk of another financial crisis. AFR urges the House to reject these irresponsible budget cuts.
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