As gas prices rise to nearly $4/gallon across our nation, I am leading an effort in Congress and within the House Agriculture Committee to investigate every contributing factor to the skyrocketing price of oil including the role of Wall Street speculators in driving up the price at the pump.
There is little question that until we reduce our nation's dependence on foreign oil, we will be subject to price swings caused by instability and political unrest in heavy oil-producing nations. That is one of the many reasons I have advocated for renewable energy sources that can be created right here in Iowa.
However, there is mounting evidence that market speculators and hedge funds are manipulating commodities markets. I have been joined by eight of my colleagues in a letter that calls on the House Agriculture Committee to conduct a hearing and investigation into whether or not Wall Street may be compounding consumer pain at the pump.
In my role as Ranking Member of the Agriculture Subcommittee that oversees the U.S. Commodity Futures Trading Commission (CFTC), I have a responsibility to ensure that Wall Street traders are not exploiting oil supply fears to make big profits. Just like in 2008, evidence is growing that indicates this is exactly what is taking place. Investment bank Goldman Sachs reported in April that the price of oil has been driven up at least $20 higher than regular supply and demand dictates, and admits speculation has been excessive and is harming our nation's economic recovery.
There are laws on the books that should prevent this from happening. Congress passed the Wall Street Reform and Consumer Protection Act to give the CFTC more power in regulating excessive speculation in the commodity markets and directed them to implement strong position limits on the amount of oil Wall Street speculators could trade in the energy futures market by January 22, 2011. Unfortunately, the CFTC has yet to implement position limits as directed, and House Republicans have done everything in their power to stall and chip away at regulations designed to keep Wall Street under control and prevent another financial collapse.
We know what happens when Wall Street is allowed to go unchecked. The problems are compounded when the cost of so many other commodities are affected by the price of fuel, especially with agricultural products and production. I hope to shine daylight on who is really behind the increasing cost of oil and gas and making a quick buck off the backs of working Americans. I will continue to fight for every Iowa family who does not have room in their budget for $4/gallon gas, for agricultural producers who are seeing their profits eroded with the high cost of inputs, and for industries trying to get their goods to market. We all deserve better.