Johnson Introduces Bill to Require Analysis of Added CFTC Regulations

Washington, D.C. – Today U.S. Representative Dusty Johnson (R-S.D.) introduced the Commodities Futures Trading Commission (CFTC) Cost Benefit Improvement Act to formalize the office of the Chief Economist at the CFTC and require the Commission to assess the cost and benefits of any Commission actions or added regulations. The House Agriculture Committee will consider this legislation on Wednesday during the markup of the CFTC reauthorization.

"A proper cost-benefit analysis will foster a more informed dialogue between regulators at the CFTC and market participants," said Rep. Johnson. "Formalizing the office of the Chief Economist will ensure the best economic analysis is taken into account with every decision the Commission makes."

In 2011, President Obama issued Executive Order No. 13563, which required non-independent executive branch agencies to conduct cost-benefit analyses to ensure that the benefits of any rulemaking outweigh the costs. The proposed legislation seeks to apply those same standards to the Commission.

The CFTC Cost Benefit Improvement Act would raise the legal standard for cost-benefit analysis the Commission is required to perform by requiring the Commission to "assess" the costs and benefits, both qualitative and quantitative of Commission actions. Furthermore, the legislation would also formalize the Office of the Chief Economist in statute, in a manner consistent with the CFTC's General Counsel's office, to ensure there is a Chief Economist to task with producing the required analysis.