The Senate Agriculture Committee Monday approved President Obama's choice for chairman of the Commodity Futures Trading Commission (CFTC), voting out the nomination to the full Senate for confirmation.
A spokesman for the Senate panel said there were "no negative votes" by committee members against the nomination of Gary Gensler, former Treasury undersecretary and executive at Goldman Sachs, for chairman of the federal agency that oversees the energy and agriculture futures markets.
Gensler's nomination had been stalled by committee Chairman Tom Harkin (D-IA) due to his concern about the "deregulatory orientation" of the CFTC nominee, who as Treasury undersecretary under the Clinton administration had worked to prevent the CFTC or the Securities and Exchange Commission from regulating credit default swap transactions, which have been blamed for the credit problems in the financial markets.
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."
At his confirmation hearing last month, Gensler told the Senate agriculture panel that he believed the CFTC "has to be a tough cop on the beat and strong in enforcement." He said the agency has requested a staff increase to 690 to carry out its oversight activities (see Daily GPI, Feb. 26).
"But beyond that I believe that we do...have a broad agenda, if I'm confirmed, to try to get additional authorities to address some of the very real issues in the agriculture and energy markets and [the] over-the-counter markets to control some of the excesses that we've seen."
Gensler believes that the CFTC should "bring the whole over-the-counter derivatives [market] into the regulatory regime with centralized clearing and exchanges."
"I'm not sure when [Gensler's] nomination will come to the Senate floor. We hope it will be a smooth confirmation," said a Harkin aide.
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