(CNSNews.com) - Democrats who gathered Wednesday to hear testimony on possible ways to bring down gas prices placed the blame squarely on Wall Street commodity traders for “excessive speculation.”
Among the methods discussed by the Democratic Steering and Policy Committee to deter excessive speculation are more government spending, higher taxes, and legislation limiting speculators in the market.
Two witnesses went before the committee and blamed speculators for high gas prices, claiming they have “taken over” the market and are “gambling” for profits.
Gene Guilford of the Independent Connecticut Petroleum Marketers Association and Professor Michael Greenberger from the University of Maryland Frances King Carey School of Law, told the committee the best way to deter excessive speculation is to increase the funding for the Commodities Futures Trading Commission (CFTC), to better oversee trading in the markets.
"Gamblers wearing Wall Street suits have taken these markets over,” Greenberger told the committee.
Currently the CFTC, which polices the commodities market, receives $205 million. The Obama administration has proposed increasing its funding to $308 million.
“Well, my view is that they should get $408 (million)” Greenberger said.
Putting a user-fee on entities policed by the CFTC as a way to boost the agency's funding was proposed in the president’s 2013 budget and was brought up again by the Democratic committee. Republicans have criticized that move as a tax increase.
Legislation limiting commodities trading was also discussed. Greenberger told the panel that “You can pass legislation banning commodity index swaps and exchange traded funds and you will remove 500 trillion dollars from the market.”
One possible option that both some GOP and Democratic lawmakers have expressed interest in is having the White House release oil from the Strategic Petroleum Reserves. Many lawmakers say that would immediately have an impact lowering prices for consumers at the pump.
“The Strategic Petroleum Reserve is to speculators what Kryptonite is to Superman,” Rep. Edward Markey (D-Mass.) told the committee.
Some Republicans support the idea of releasing oil from the reserve but also want more domestic oil drilling. Rep. Cory Gardner (R-Colo.) has proposed the Strategic Energy Production Act that would force the president to issue more onshore drilling leases if he releases oil from the U.S. Strategic Petroleum Reserve.
Increasing drilling was not an issue taken up by the Democratic panel. The Obama administration has repeatedly said that supply and demand economics are not the cause of high gas prices.