Sen. Bernie Sanders (I-VT) has placed a "hold" on the nomination of Gary Gensler for chairman of the Commodity Futures Trading Commission (CFTC), citing his record of supporting trading initiatives that led to failed results.
"While Mr. Gensler is clearly an intelligent and knowledgeable person, I cannot support his nomination. Mr. Gensler worked with [former] Sen. Phil Gramm [R-TX] and [former Federal Reserve Chairman] Alan Greenspan to exempt credit default swaps from regulation, which led to the collapse of AIG [American International Group] and has resulted in the largest taxpayer bailout in U.S. history," Sanders said.
"He supported the Gramm-Leach-Bliley [proposal], which allowed banks like Citigroup to become 'too big to fail.' He worked to deregulate electronic energy trading, which led to the downfall of Enron and the spike in energy prices. At this moment in our history, we need an independent leader who will help create a new culture in the financial marketplace and move us away from the greed, reckless and illegal behavior which has caused so much harm to our economy."
While the hold is in place, the Senate is prevented from voting on the nomination of Gensler, a former Treasury undersecretary and executive at Goldman Sachs. Sanders met with Gensler in January to discuss his concerns, but there have been no follow-up meetings, a press spokesman for Sanders said Friday.
The Senate Agriculture Committee voted out Gensler's nomination earlier this month, with "no negative votes" cast (see NGI, March 23). His nomination had been stalled by committee Chairman Tom Harkin (D-IA) due to his concern about the "deregulatory orientation" of the CFTC nominee.
While Harkin did not block Gensler's nomination in committee, he gave him a less-than-ringing endorsement following the panel's vote. "At his confirmation hearing, Mr. Gensler responded to our questions carefully and knowledgeably. I am hopeful that he will lead effectively in reforming and restoring regulation of trading in futures and other derivatives contracts. While it is not possible to know for certain how he will handle all of the issues that will come before him, I...believe we should move his nomination forward to the full Senate."
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