If you haven’t heard of the Enron Loophole, you’ve at least felt it–in your wallet, while pumping gas or paying your oil bill. Described in its simplest terms, it’s legislation passed in December of 2000 ( Commodity Futures Modernization Act of 2000) which deregulated electronic trading of energy futures. Why is this important? It’s the speculation and future trading of energy that is driving US gas prices toward $5.00 a gallon. Why is it called the Enron Loophole? Embedded Enron officials (there is no other way to describe them) in the government pushed through the legislation, strengthened it, benefited from it, and now protect it.
To gain a greater understanding of the Loophole, its creation, and the resulting it’s-the-people-who-always-get-screwed fallout, please watch the following video from Keith Olbermann’s Countdown (If you are a conservative and just reading “Olbermann” sends you into a heaving boil, please suck it up and take deep breaths for the duration. The bet here is you’ll be glad you saw it.)
The Hangover has been extremely critical of Republican policies and somewhat critical of the Democrats. But there is plenty of blame to be dished out for both parties in this instance. The seeds of deregulation were planted in the waning days of the Clinton administration. Deregulation was commissioned and intensified in the blatantly corrupt Bush administration. But as the Countdown report reveals, Congress was fully aware of the effect that the Enron Loophole had on gas and oil prices: Big oil and Enron cronies make money; the rest of us get screwed. And for the most part, Congress sits on its collective ass. As The Hangover has asked before: Where’s the outrage?
This scheme has continued and thrived for eight years now. As Olbermann reports, gas prices have more than doubled, as have heating oil costs. It’s interesting (not to mention ‘hideous’) to note that there are Democrats (aren’t they the ones who are supposed to look out for us regular folk?) in both the Senate and House of Representatives. However, it cannot be substantiated that more than a few them (Go Dennis Kucinich!) have integrity, conviction, or backbones.
Although many experts believe an end to this unregulated speculation would drop gas prices to near $2.00 a gallon, Congress has been slow to act. It is only recently that legislators tried to increase regulation and eliminate the loophole that has its heel on our gas-buying throats. There was an amendment placed in the Farm Act (HR 2419) that increased energy commodity trading transparency but did not eliminate the loophole. Companion 2007 “Close the Enron Loophole” bills languish in Senate and House committees. Tom Allen (D) of Maine and Bart Stupak (D) of Michigan will be introducing the PUMP Act (Prevent Unfair Manipulation of Prices) later this month. Olympia Snowe (R) of Maine will be co-sponsoring a companion bill in the Senate.
But why has it taken so long for our elected representatives to act? If eliminating the loophole will instantly ease the energy burden on Americans, legislation doing so should have been pushed through Congress with focus and ferocity. It’s not hyperbole or out-of-the-box thinking to suggest that most Americans would greatly benefit from lower gas and energy costs.
Apparently The Hangover has made another foolish mistake. It’s not “the people” who run our government. It’s the corporate lobbyists and policy foundations who dish out the dollars and wield influence in our nation’s capitol. For the most part, they’re the ones who control legislation, and they’re only looking out for the interests they represent. If you doubt it, look at the receipt from your last fill-up and consider the following:
- From 2004 through 2008, the Oil Industry contributed 64.5 million dollars to political campaigns, with approximately 79% of that money directed to Republicans. (In terms of Full Disclosure, The Hangover gave $100 to John Edwards.)
And one more thing: Former Enron executives hover like buzzards over Washington. They and their ilk talk to your Senators and Congressmen everyday. Do you?