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America's #1 PopulistJim Hightower
The Enron Loophole and Your Gas Prices In only two years, the price of crude oil -- which accounts for 75 percent of gasoline prices -- has more than doubled, from $60 a barrel to $140. Why? The biggest cause is not OPEC, or increased demand from China. Instead, it's that same fun bunch that brought us the collapse in today's housing market: rich speculators, working through global investment banks and hedge funds. Most Americans who find themselves being robbed at the pump have no idea that faraway commodity traders are manipulating the price of crude using a mischievous mechanism known as the "Enron Loophole." This creates an electronic casino game, allowing global speculators to bet on the future price of oil, using a few facts, wild guesses and chicken entrails as the basis for their bets, which artificially drive up the price of oil. Hedge funds at Goldman Sachs and Morgan Stanley, for example, own huge amounts of these oil futures, and they're already accepting bets as high as $200 a barrel -- a price completely unattached to the real cost of producing oil or to such niceties as supply and demand. Worse, their gambling on our prices is done with no public oversight. That's because a special loophole says that electronic trading of such commodities as oil is not subject to the normal government rules that prevent price distortions. This loophole was written by Enron lobbyists, rammed through Congress in 2000 by then-Sen. Phil Gramm and signed by Bill Clinton. The resulting speculative oil bubble has jacked up our pump prices by a third, costing you and me about $1,500 each over the past two years -- with much more to come out of our pockets as speculators raise their bets. By the way, John McCain's top economic advisor is Phil Gramm, who recently convinced McCain to oppose efforts to close the Enron Loophole [and said our economic troubles were all in our minds - ed]. Rewriting Some Patriot Act Stupidity Empirical evidence notwithstanding, stupidity is not a requirement for membership in the U.S. Congress. Also, stupid acts by Congress do not have to be forever. Witness the infamous, freedom-busting, Orwellian piece of legislative stupidity known as the Patriot Act. Passed by a panicked Congress right after 9-11, and reauthorized by a cowed Congress in 2006, this thing empowers the FBI to make wholesale, secret invasions of the American people's privacy -- grossly violating one of our country's core values. As we've learned from investigative reports by the bureau's own inspector general, concerns about intrusive and abusive actions by a bulked-up FBI were not theoretical. This national police agency has been found guilty of "widespread and serious misuse" of the Patriot Act's most invasive provisions. For example, the act opened up our private records to government agents, enabling them to write their own authorizations for poking into our personal business without having to show any reasonable cause for spying on us. Hundreds of cases of the FBI sweeping up information it has no authority to collect have now been documented. Did no one foresee the stupidity of granting such broad, unchecked power? Yes. Sen. Russ Feingold did, and he cast the one courageous vote against the Patriot Act in 2001. Now Feingold is back with S. 2088, a bill to rein in the FBI and restore the people's constitutional rights. As he puts it, we've learned the hard way that "trust us" doesn't cut it when it comes to preventing government snoops from abusing their power. Congress has the responsibility to put appropriate restraints on government authorities, and that's what Feingold's "National Security Reform Act" does. To help put some real patriotism in the misnamed and misguided Patriot Act, contact Feingold's office at (202) 224-5323. Copyright 2007 by Jim Hightower & Associates.
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