Yesterday, I noted that President Barack Obama’s latest proposal to target so-called “oil speculators” with regulations and increased fines is yet just another way for him to cast blame instead of working towards policies that would increase supply, which is what most analysts say is causing uncertainity and thereby higher gas prices. It’s another gimmick, for sure, but the rhetoric may be effective since most voters don’t understand the basic economics of how the market works.
But the Washington Post is criticizing Obama’s “crackdown,” noting that his latest gimmick will do absolutely nothing to lower gas prices, leaving Americans with more empty promises and more failed leadership:
The White House insisted Tuesday that high volume and volatility in oil markets suggest that regulators need more tools to monitor and control them. But a senior administration official deflected questions about whether regulators have detected any hint of manipulation and would not give an example of the sort of rigging the president suspected regulators might find with more resources. The official instead repeatedly pointed to Enron — a scandal involving electricity, not oil, markets. So the argument boils down to: “Maybe the CFTC will find something, we don’t really know what.”
Even with Americans still struggling to keep with high gas prices, President Barack Obama yesterday targeted the oil industry with more proposed regulations — once again offering nothing in the way of real solutions to increase oil supply. The Los Angeles Times notes that Obama wants more money for regulators and more penalties for what “manipulation” of the oil market:
Facing heat for high gasoline prices, President Obama tried to shift the focus to Congress, Republicans and energy traders, calling for legislation that he said would “put more cops on the beat” to crack down on potential manipulation of the oil market.
Obama called on Congress to provide more money for regulators and increase penalties for market manipulators. The president, flanked by Treasury Secretary Timothy F. Geithner and Atty. Gen. Eric H. Holder Jr., suggested that traders and speculators are affecting the price of oil and digging into Americans’ pocketbooks.
“We can’t afford a situation where some speculators can reap millions while millions of American families get the short end of the stick,” Obama said in brief remarks in the Rose Garden on Tuesday. “That’s not the way the market should work.”
Obama’s proposal would add $52 million to the budget for the Commodity Futures Trading Commission, which oversees oil futures markets, to pay for improved technology and additional employees. The president also proposed increasing the maximum civil and criminal penalties for manipulative activity in oil futures markets and beefing up data collection.