Democrats’ Energy Bill Does Nothing to Address Gas Prices – Could Make Worse

"But I do know this is something we can do and have an immediate impact on the price of gasoline at the pump, and that's what my constituents are asking us to do." Senator Cardin (D, MD) Senate Floor, July 21, 2008.

"First, address speculation with the democratic bill. We have said to the republicans, offer your version. If you don't want to offer a bill, vote against ours if you wish but we offer you this opportunity to put your amendment on the floor on speculation, whatever it happens to be. We will go head to head, one on one against the other." Senator Durbin (D, IL), Senate Floor, July 21, 2008.

FACT: Near universal agreement dictates that something should be done to increase transparency and ensure integrity in commodities’ markets. But while Senate Democrats claim compassion for the average American, they consistently fail to address the disastrous supply problem. The effect of yet another Democratic "no energy" bill could actually be higher gas prices.

In a response to a request from Senator Chambliss (R, GA), Presidential Working Group members Treasury Secretary Paulson, Federal Chairman Bernanke, SEC Chairman Cox, and CFTC Chairman Lukken gave their analysis of S. 3268, "The Stop Excessive Energy Speculation Act of 2008."

The response letter expressed concern for the current market condition of high commodity prices, especially oil. However, these four experts concluded this bill could actually have harmful repercussions for U.S. energy markets.

"(T)he PWG believes that bill S. 3268, as introduced, would significantly harm U.S. energy markets without evidence that it would lower crude oil prices."

"(P)rices appear to be reflecting tight global supplies and the growing world demand for oil, particularly in emerging economies."

"Provisions in the bill may also harm U.S. competitiveness by driving some trading to overseas markets or to more opaque trading systems at a time when policymakers are trying to encourage greater transparency."

"To date, the PWG has not found valid evidence to suggest that high crude prices over time are a direct result of speculation or systematic manipulation by traders."

A Wall Street Journal editorial explains just how ridiculous the Democrats’ energy plan is:

"Even the title of the Senate's bill -- the ‘Stop Excessive Energy Speculation Act’ -- is idiotic. True, the volume of trading has increased by about sixfold since 2000, but it can't be ‘excessive.’ The inviolable law of futures markets is that someone has to take the other side of any option. That is, the value of contracts agreed to by sellers anticipating that prices will fall must equal the value of contracts agreed to by buyers anticipating prices will rise. The overall size of the market is irrelevant." Wall Street Journal, An Energy Sarbox, July 22, 2008

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