WASHINGTON, Feb. 11, 2015 — The chairman of the House Appropriations Agriculture Subcommittee today told the head of the Commodity Futures Trading Commission (CFTC) the agency won’t be getting the $72 million increase in spending President Obama is asking for.
The request fails to “reflect our nation’s crippling debt,” Rep. Robert Aderholt, R-Ala., said in his opening statement at a hearing on the CFTC spending request. “The bottom line is that our nation needs to stay on a diet and the Budget Committee will likely ensure domestic spending remains flat.”
The White House requested $322 million in spending for fiscal year 2016 for the CFTC, which among other things, oversees futures trading in corn, soybeans, wheat, cattle and other agricultural commodities. CFTC says it needs the extra funds to provide better financial market oversight and to boost defenses against cyberattack.
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According to Aderholt, CFTC spending has increased 123 percent since the 2008 recession. The 2016 budget request, if approved, would push the increase to 188 percent, nearly tripling the agency’s size since 2008.
In response, CFTC Chairman Timothy Massad testified that the increase would ensure his agency could provide financial oversight of swaps and derivative markets mandated by the Dodd-Frank Act.
Most of the requested increase (61 percent) would pay for added staff and staff-related capacity building, while the remaining 39 percent would go toward improving technology in data collection and analysis, market surveillance and enforcement, the CFTC says.
“CFTC more than earns it keeps,” said California’s Sam Farr, the subcommittee’s top Democrat. “From 2009 to 2014, the CFTC collected fines and penalties of approximately twice its cumulative budgets. This (fiscal) year, the fines and penalties collected are already six times more than the CFTC’s budget.”
In his opening statement, Massad said the agency obtained $3.27 billion in sanctions, including $1.8 billion in civil monetary penalties and more than $1.4 billion in restitution and disgorgement in fiscal year 2014. Those proceeds bypass the commission and go directly to the U.S. Treasury.
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