Wednesday, April 30, 2008
Here's the basic concept: there are two ways to challenge the constitutionality of a statute. First, the "facial" challenge whereby the plaintiff claims that the law itself is unconstitutional simply because of what the ordinance/statute/regulation says. For example, if New York enacted a statute stating that the official religion of the state is Presbyterianism and the plaintiff challenged the law's content, that's a facial challenge. Of course, this is an extreme scenario because it entails a state legislature enacting a measure directly contrary to a Constitutional provision. Real cases are not so stark -- such as the Voter ID case the Court decided Monday.
The second type is the "as applied" challenge. In that scenario, the plaintiff claims that the law is unconstitutional as the government has applied it to the plaintiff's specific situation. For example, litigation by certain American Indian prisoners who have claimed that prison drug policies curtail their right to the Free Exercise of their religion because they cannot use peyote in specific religious rituals.
In the past three years, facial challenges have been unsuccessful with the Roberts Court. Thus, Savage notes that the Court has sent a message to litigants: "Produce evidence that a law has actually violated someone's rights, and name names if you can." And this is good because the Court reinforces the presumption that legislatures act legitimately when enacting broad laws.
The 21-year old Yankee starter, who began living up to his phenom billing toward the end of last year and in his brilliant playoff relief appearance after Roger Clemens spit the bit, has been awful this year. His command is terrible (13 BB, 22 IP), he can't get strikeouts (13 in 22 IP for a power pitcher), he's allowing more than 2 hits +/or walks per inning and opponent OPS is .947 -- that's abysmal. He has better ability than Jon Lester, the Redsux starter who has pitched great all season, but something has not clicked. Simply stated, and it pains me to say this because I'm cheering on the kid and hoping he reaches his preposterously high potential, Hughes sucks right now.
And for that reason, he doesn't belong in the major leagues. Joe Girardi can claim the mound is the same distance away in the Scranton ballpark, but so what? Hughes will get additional attention at the AAA team and should be able to restore his confidence and effectiveness. Look at how Cliff Lee responded to his 2007 demotion after stinking up a spot in the Indians rotation (5-8, 6.29, 17 HR in only 97 IP) -- barring a horrid outing tonight, Lee should be the pitcher of the month for April because he's 4-0 and has allowed just 11 hits in 31.2 IP with a ridiculous ERA of 0.28 and only 2 BB but 29K! Those numbers are better than Clemens put up in his warmup outings in the minors!
Hughes needs time, effort and work, but there's no way a 21-year old kid can get right in New York (and his career home/away splits show he's terrible at The Stadium but a killer on the road). So the course is clear - demote him, promote Darrell Rasner (who'd pitched decently well last year before an injury quashed his season and who's pitching brilliantly in AAA) and work Hughes back later in the year.
Tuesday, April 29, 2008
First, he notes that the Indiana law that the Supreme Court upheld is "the toughest" in the country. Second, he notes that Justice Breyer, in dissent, approvingly discussed the somewhat laxer photo ID law of Georgia and Florida -- thus, there are potentially seven votes for the constitutionality of those laws. Third, Fund mentioned that even Souter's dissent (which Justice Ginsburg joined) did not call for reviewing the law under the "strict scrutiny" test -- that means the Court does not treat voter ID laws like racial preferences or speech restrictions that are allowed only where the state shows a compelling interest in the enactment and no less restrictive means to reach its legislative objective (i.e., the "compelling governmental interest and least restrictive means" analysis).
More interesting is the background of Justice Stevens: he's a Chicagoan who knows all too well about government corruption and voter fraud because he comes from the city that is synonymous with the concept, served as special counsel to a commission dedicated to rooting out corruption in government and has ruled against the Chicago machine as a member of the high court.
Equally interesting is Fund's description of Barack Obama's activities on behalf of ACORN, a far-left interest group that has a history of enabling, engaging, encouraging and assisting voter fraud. Obama represented ACORN's challenge to Illinois' refusal to implement the Motor Voter law.
Read the whole piece.
UPDATE: Other editorials and news articles on the decision have been compiled by appellate lawyer Howard Bashman, who runs the How Appealing blog that focuses on appellate court decisions throughout the country, here.
The WaPo's editorial thinks the Indiana law is like taking a sledgehammer to a fly. The LA Times cries about needing more voter involvement, not less -- as if participation in the voting process by people who don't care is a positive thing -- and that the Court has rolled back the interest of society in fuller participation. Of course, one problem is that people who ordinarily don't care to vote get rounded up by community organizers and driven to the polls to cast a ballot as the organizers suggest -- this is what happened in Milwaukee in 2000 and 2004, and what happened in New Orleans in the 2002 Louisiana gubernatorial election. The Monk worked as a journalist for nearly four years in college (and more than one of his colleagues became journalists in major newspapers) -- the LA Times' editorial is typical newsroom piffle.
Monday, April 28, 2008
The ad makes three points: Obama attended Rev. Jeremiah Wright's church for 20 years, Wright said the Almighty should damn America and, because of his apparent comfort with his pastor's extremism, Obama is "too extreme for North Carolina."
Considering that the first two points are simply facts, and the third is a conclusion that North Carolinians could reasonably draw from the first two points, what's wrong? This isn't mudslinging. There are no charges that Obama would fraternize with terrorists as President (even though he's said he would meet with Iran's leaders) or that he's a foolish socialist (imminently reasonable given his economic policies), and those are easily defensible "negative" claims.
McCain needs to smarten up: there are three facts in any campaign situation -- the press wants to see the candidates debate issues only and will side with the liberal; the public will say it wants a positive, issues-based campaign; and NEGATIVE ADS WORK.
Finally, McCain has to realize that there is, has been, and will be a double standard at work for him because he is a Republican. On top of that, there will be a second double standard because he is white, as the Examiner demonstrates:
. . . none of the critics point to factual inaccuracies in the ad, so they hide behind a parade of accusatory generalities about tone and tenor. As for [DNC Chairman Howard] Dean's observation, we look forward to hearing his explanation – delivered, please, without his usual opportunistic bombast - of precisely what in the ad is "racially divisive." Otherwise, it's difficult not to conclude that what is really going on here is an attempt by Obama and his sympathizers to put all discussion of his relationship with Wright off-limits by branding it somehow "inappropriate" or vaguely racist. Ditto his relationship with unrepentant Weather Underground terrorist Bill Ayers and Chicago political bagman Tony Resko. For clarity on this point, simply ask yourself how these same people would react if the tables were turned and McCain had sat passively in the pews for 20 years listening to an unreconstructed Southern Baptist bigot in the pulpit damning America for seeking racial equality, accusing the government of inventing AIDS to punish sinners and extolling KKK Imperial Dragon David Duke for defending the superiority and purity of the white race. The double standard at work here is absolutely breath-taking.
Last year, in giving the Giants a C- grade, ESPN draft "expert" Mel Kiper, Jr. said this about the Giants' draft:
I would have gone differently with the Giants' draft. Cornerback Aaron Ross has very good ball skills but not great catchup speed. I was surprised they didn't take left tackle Joe Staley because they need someone who can protect Eli Manning's blind side. The Giants took offensive tackle Adam Koets in the sixth round and even passed on left tackle Jermon Bushrod. If they had taken Staley, they could have drafted Eric Wright from UNLV instead of WR Steve Smith. I would rather have had Staley and Wright, but Smith is a good receiver and will be someone who holds onto the ball. Zak DeOssie was a really good long snapper in college and, at worst, will be a backup linebacker in the NFL. Kevin Boss (fifth round) is a natural pass-catching tight end with speed and has a chance to make an impact in the passing game. Safety Michael Johnson was a good pick in the seventh round but needs to be more physical.
And yet . . .
And yet every one of the Giants' picks in the 2007 draft PLAYED IN THE SUPER BOWL. Some played big roles: Boss had a 45-yard reception that jump-started the Giants' first TD drive. Third-round pick Jay Alford (not mentioned) sacked Tom Brady on the Pats' desperation drive at the end of the game. Ahmad Bradshaw (not mentioned) was the #2 running back for the Giants throughout the playoffs. And that Steve Smith pick that Kiper critiqued -- absolutely crucial. Smith had key receptions throughout the playoffs, especially on third down passes; most notably, the third down catch that set up Plaxico Burress' game-winning TD. And we won't forget to mention that Aaron Ross is now likely a starting corner for the Giants whose ballhawking skills are crucial in a blitz-heavy defense.
So forget a grain of the stuff -- go out and buy a salt-lick to take with the analysts' analyses of the draft. If Matt Ryan turns into Peyton Manning II, the Falcons are geniuses. If Mario Manningham, who has 1st round talent but some off-the-field issues, turns out to be the next Tim Brown, the Giants are brilliant for taking him with their third-round pick. My only disappointment is that the Giants left Dan Connor on the board when they could have taken him in the second round.
Read the WSJ for more.
To show just how bad George H.W. Bush screwed up his first Supreme Court pick (and to think, Edith Jones of the Fifth Circuit came in second), David Souter dissented claiming that the burden for rural, poor and elderly voters to just go to a motor vehicle department office and obtain a license would be overly burdensome. That claim is patently ridiculous -- after all any poor, old or rural voter has to use a photo ID to cash a check.
This ruling gives the states considering voter ID laws the impetus to enact reasonable ones. Only 25 of the 50 states even have voter ID laws, only 7 of those have PHOTO requirements, and in some the consequences of not having an ID are relatively meaningless. Look at Florida, for example, where a voter without an ID who is just lying anyway can simply fill out an affidavit and vote. Similarly in Arkansas, the precinct monitor merely notes that the voter did not have ID but does not prohibit a vote or relegate the vote to a provisional ballot. Even more distressing is that some states known for rampant voter fraud (Illinois, New York, Wisconsin) have no ID law.
I'm registered at my precinct, I have my voter card and my ID, and I vote ONCE per election. My state, and every other in the nation, should take reasonable steps to ensure that my vote is counted and, more importantly, not diluted by a fraudulent voter. The Supreme Court's decision just helped the states protect their legitimate voters if they so choose.
Friday, April 25, 2008
The problem is the spectacular and useless embrace he exchanged with the senior Hamas dignitary, Nasser Shaer, in Ramallah.
The problem is the wreath he laid piously at the grave of Yasser Arafat, who, as Mr. Carter knows better than anyone else, was a real obstacle to peace.
It is that in Cairo, if we are to believe another Hamas leader, Mahmoud Zahar, whose statement has so far not been denied, Mr. Carter apparently described Hamas as a "national liberation movement" – this party which has made a cult of death, a mythology of blood and race, and an anti-Semitism along the lines of the Protocols of the Elders of Zion into the linchpin of its ideology.
The problem is also the formidable nose thumbing he got from Hamas's exiled leader, Khaled Mashaal, who, at the very moment he was receiving Mr. Carter, also triggered the first car bombing in several months in Keren Shalom on the Gaza strip – and that this event elicited from poor Mr. Carter, all tangled up in his small-time mediator calculations, not one disapproving or empathetic word.All true.
It's disgraceful the degree to which Carter has devoted his life to undermining the policies and interests of the country that rightfully removed him from office after four years of a failed presidency.
Thursday, April 24, 2008
17:45 24Apr08 RTRS-U.S. CONCLUDES SYRIAN NUCLEAR REACTOR WAS "NEARING OPERATIONAL CAPABILITY" IN AUGUST 2007 - U.S. DOCUMENT
17:46 24Apr08 RTRS-U.S. CONCLUDES NORTH KOREA HELPED SYRIA ON NUCLEAR ACTIVITIES BEFORE AND AFTER REACTOR WAS DESTROYED - U.S. DOCUMENT
17:48 24Apr08 RTRS-U.S. HOPES DETAILING SUSPECTED SYRIA-NORTH KOREA LINK WILL PROMPT PYONGYANG NUCLEAR DISCLOSURES - U.S. OFFICIAL
17:50 24Apr08 RTRS-U.S. DID NOT GIVE ISRAEL ANY "GREEN LIGHT" TO STRIKE SUSPECTED SYRIAN NUCLEAR REACTOR - U.S. OFFICIAL
18:08 24Apr08 RTRS-North Korea aided Syrian nuclear activities -U.S.
WASHINGTON, April 24 (Reuters) - The United States has concluded that North Korea helped Syria on a covert nuclear program before and after Israel destroyed a suspected reactor in Syria last year, according to a U.S. intelligence document.
"We are convinced, based on a variety of information, that North Korea assisted Syrian covert nuclear activities both before and after the reactor was destroyed," said the document released to reporters on Thursday.
A senior Bush administration official said the United States and Israel had discussed policy options on how to deal with the suspected reactor but that Israel decided to destroy it on its own.
"At the end of the day, Israel made its own decision to take action," the official told reporters.
"It did so without any green light from us."
Wednesday, April 23, 2008
Some wisdom from his op-ed on the Colombia Free Trade Agreement, which the Democrats (and Big Labor) have worked to scuttle despite how it would actually aid America's exports by granting tariff-free access to the Colombian market (90%+ of Colombian exports to the US are not tariffed under existing agreements).
First, the economic reasons to approve the accord:
The economic arguments that favor the agreement with Colombia are clear. Today, approximately 90% of Colombian exports come to the U.S. duty free under the Andean Trade Preferences Act and other agreements. President George H.W. Bush signed it as a way to counter the drug trade. By increasing trade, the law has helped create almost 600,000 jobs in Colombia, and these jobs are the best defense against the narco-traffickers and the terrorist networks they support.
While the Andean measure is an important and necessary pillar in our efforts to stem the flow of illegal drugs, it also means that American companies and workers do not play on a level playing field. We can change that by passing the Colombian agreement. Once enacted, over 80% of U.S. exports of consumer and industrial products to Colombia would immediately become duty-free, and all remaining tariffs would be eliminated within a decade.
Second, the political reason:
Members of the U.S. Congress should also consider the national security arguments that favor this free-trade agreement. Colombia has long been a valued ally in a region that is increasingly becoming adverse toward our interests. Bolivia and Ecuador are to one degree or another antagonistic toward the U.S., and Venezuela is outright hostile.
Compare that to Colombia, an openly supportive, long-time ally that has long partnered with the U.S. on economic and security matters. Colombia was there when we needed an ally in that region. The backbone of the U.S.-Colombia security relationship, Plan Colombia, was started by President Bill Clinton and continued by President George W. Bush. Since Plan Colombia was conceived in 1998, the Colombian government has worked closely with the United States to prosecute the war on drugs.
It has done so while constantly battling the so-called "Revolutionary Armed Forces of Colombia" (FARC). This group is no quaint band of pseudo-revolutionaries. Simply put, it is a terrorist organization – so classified by both the European Union and the U.S. government – and one that receives a significant amount of its financing from the drug cartels.
If the contents of a recently-seized computer once owned by Raul Reyes, a FARC leader that Colombia recently killed, are verified as accurate, the world would have incriminating evidence that Venezuela and Ecuador have been clandestinely supporting the FARC.
Does America want to allow Hugo Chávez to remake the Andean region in his image? While this matter is currently being investigated, it is clear that Chávez and his allies are already destabilizing the region. Both Ecuador and Venezuela, two of Colombia's biggest trading partners, have brought trade between them and Colombia to a virtual standstill.Nancy Pelosi and the Democrats are siding with a US enemy over a US ally. It's ultimately that simple.
Tuesday, April 22, 2008
Bob Novak, the highly distinguished veteran columnist and author, told the American Spectator New York dinner group last night that John McCain will defeat Barack Obama in November’s election, although the Democrats will enhance their majorities in both the Senate and the House. Novak, who has covered elections for fifty years, speculated that McCain will pick former Ohio congressman Rob Portman (who also was President Bush’s special trade representative and OMB director) as his running mate, while Obama could choose former Sen. Sam Nunn as his.
On Portman, Novak said he’s young, will pass the conservative spell check, and can stand up in a debate. Our speaker also told us that the GOP has stumbled into the exact right candidate this year in McCain. Regarding McCain’s tax-cut proposals, Novak thinks they are real, and that cutting the corporate tax rate, as McCain has proposed, should be much more important to observers than the candidate’s occasional corporate and Wall Street bashing.
Novak also believes Obama’s gaffes about bitter small-town people who cling to guns and religion will be an absolute killer in the general election. So will the Jeremiah Wright business, and more generally Obama’s extreme, across-the-board, liberal-left positions.
Hm. Would certainly be a surprise choice. And one that may have a material chance if Novak is talking publicly about it. The problem with Portman is that he has virtually NO name recognition except amongst the real political junkies. For a candidate who's likely in an uphill climb he won't get much bounce out of Rob Portman. May be less important if Hillary is the head of ticket but Obama near rock-star status [at least in the MSM] and the likelihood that he may choose a conservative Democratic foreign policy 'statesman', e.g., Sam Nunn, makes a McCain/Portman ticket pale at first blush.
A real maverick pick (don't see it but could be interesting) would be Robert Rubin. Rubin is smart, a finance guru, served impressively in his stint as Secretary of the Treasury and his recent comments on the subprime crisis and Hank Paulson have been intelligent and well reasoned. Why it won't happen - primarily because Rubin may not be interested, he (70) doesn't balance McCain's age and concern that conservatives may howl.
Friday, April 18, 2008
It didn't matter. Nobody noticed. A room full of journalists didn't notice this was something new and interesting. And they didn't notice because nobody is listening anymore.
Mrs. Clinton is transmitting, but people aren't receiving. She has been branded, tagged. She's been absorbed, understood and categorized. People have decided what they think, and it's not good.Indeed, even after the Obama "you're all a bunch of gun-toting religious nuts because you don't have your factory jobs" gaffe, DNC chairman Howard Dean is calling on Democrat superdelegates to choose now and the NYT news service reports that the superdelegates were unpersuaded by HRC's (consensus) win in Wednesday's debate.
This all gives PaMonk reason to cheer because he despises the Clintons. With good reason: MaMonk was part of the superwoman generation (full-time work, running family, raising progeny) and didn't see the need to stretch out her shoulder and pat herself on the back all the time like HRC; PaMonk also hated how the first boomer president defiled the office itself. The Clintons are inveterate, unapologetic and unrestrained liars.
The Obamas are essentially the Carters.
And The Monk is voting for McCain.
Click the link.
UPDATE: Yuval Levin doubts the authenticity of the story. If it's a hoax, the girl is rather sick and disgusting. If it's real, it's heinous.
UPDATE 2: The AP reports that Levin's instincts were right -- this story is a hoax. That means the art student, Aliza Shvarts, is a callous and sick individual. Evidently Yale DOES admit morons.
Tuesday, April 15, 2008
The elder Chamberlain is ill. He has polio and he is nearly paraplegic because his left side is essentially paralyzed. Joba left the Yanks to take bereavement leave yesterday. TKM wishes the Chamberlains all the best and hopefully a speedy recovery for Harlan.
And Derek Jeter arranged a private plane to take Joba to his dad's side in Nebraska.
Friday, April 11, 2008
It is said that generals always fight the last war. But when David Petraeus came to town it was senators – on both sides of the aisle – who battled over the Iraq war of 2004-2006. That war has little in common with the war we are fighting today.
The change goes far beyond the statistical decline in casualties or incidents of violence. A young Iraqi translator, wounded in battle and fearing death, asked an American commander to bury his heart in America. Iraqi special forces units took to the streets to track down terrorists who killed American soldiers. The U.S. military is the most respected institution in Iraq, and many Iraqi boys dream of becoming American soldiers.
The huge drop in roadside bombings is also a political success – because the bombings were political events. It is not possible to bury a tank-busting 1,500-pound bomb in a neighborhood street without the neighbors noticing. Since the military cannot watch every road during every hour of the day (that would be a purely military solution), whether the bomb kills soldiers depends on whether the neighbors warn the soldiers or cover for the terrorists. Once they mostly stood silent; today they tend to pick up their cell phones and call the Americans. Even in big "kinetic" military operations like the taking of Baqubah in June 2007, politics was crucial. Casualties were a fraction of what we expected because, block-by-block, the citizens told our guys where to find the bad guys. I was there; I saw it.
Over the past 15 months, we have proved that we can win this war. We stand now at the moment of truth. Victory – and a democracy in the Arab world – is within our grasp. But it could yet slip away if our leaders remain transfixed by the war we almost lost, rather than focusing on the war we are winning today.
Yon's website is here. He can do with more support.
Tuesday, April 08, 2008
But none of it would have mattered if the Tigers had just hit free throws.
The Monk is a lifelong Syracuse fan, so he knows all too well how it feels to watch his team lose a national title at the line. Worse yet, the Syracuse seniors were most culpable for that honk in 1987. Just as CDR missed three crucial ones in the last two minutes. Then again, SU didn't have a nine-point lead with 2:12 to play. Memphis' Derrick Rose will be remembered more as Derrick Coleman (8 points, 19 rebounds, runaway MOP if SU had won), the frosh who had the title in his hands and let it get away, than as Carmelo Anthony -- the 2003 MOP who led SU to its lone title.
Unfortunately, Calipari will get a worse beating in the press than Roy Williams. And Williams deserves it more. UNC had five full days to prep for KU AND could scout KU on TV last Sunday (as the last team in the Final Four, KU couldn't start prepping for UNC until later). KU roasted UNC at the start of their game and Carolina neither adjusted nor sought to break the KU momentum. Compare how Bill Self called two timeouts to settle his team and reiterate what it needed to do to win during the second half (the portion of the game that Self said his team went a little "brain dead") with Roy Williams' lack of timeout usage during KU's 25-2 run in the first half. Once KU returned to the strategy it began the game using, it ran away from UNC all over again. That's a complete coaching failure by Williams.
Credit KU's coaching for the win over Memphis, too. When KU pounded the ball to Darrell Arthur, it had success. The Monk wonders why Joey Dorsey gets so much publicity -- last year he famously got taken to school by Greg Oden after bragging about how he'd stuff the Ohio State center; this year, the Memphis senior (6-9, 265) was outplayed by a younger and far smaller Arthur (6-9, 225; 20 points, 10 rebounds) who is still a year away from reaching his potential.
Finally, a word of congratulation to Bill Self, who had the unenviable task of taking over for Williams in 2003-04 after KU had been to consecutive Final Fours (and four in Williams' tenure) but with a team that had lost its two best players (Collison and Hinrich) and still felt the sting of Williams' quick departure for UNC (forward Wayne Simien, who sat out the last 1/2 of the '03 season after a severe shoulder injury said in disgust after Williams left that "I gave my arm for that man!"). After an Elite Eight loss to Ga. Tech in '04, the J'Hawks had two embarrassing first-round bonks in '05 and '06 before Self lost for the fourth time in his first four Elite Eight games in '07 -- this time to UCLA. Self has always seemed like a class act who treats his program and players well, so I'm happy for him, and pleased KU is the 2008 national champion.
Monday, April 07, 2008
In addition to Moses in the Ten Commandments, Heston had a gift for portraying heroic historical figures including Judah Ben-Hur in "Ben-Hur" for which he won Best Actor, Michelangelo, General Charles Gordon, El Cid and John the Baptist. He was equally good in more modern fare such as Planet of the Apes, Soylent Green, Airport '75 and Midway.
Heston became known in later years for his adamant defense of the Second Amendment's protection of the right to bear arms.
Lesser known was his early support of civil rights and Martin Luther King as well as his transformation from liberal Democrat to conservative Republican as he grew increasingly concerned about the debasement of American culture.
Great men always have too much sail up. Great men take great risks. It’s the timorous souls — souls like myself — who err on the side of caution; who, when they see a storm approaching, take in sail and look for snug harbor.
- Christopher Buckley in a touching and excellent tribute to his father, William F. Buckley Jr.
I am not sure it has ever been said better.
*A copy of National Review's Tribute to WFB issue is available here.
Thursday, April 03, 2008
It sounds as if Congress may have heard us.
WASHINGTON, April 3 (Reuters) - Key U.S. senators on Thursday said they are weighing legislation to require U.S. commodity exchanges to boost margin requirements on energy contracts like crude oil and natural gas to rein in soaring
The Senate Energy Committee held a hearing to examine whether a flood of buying interest from noncommercial, institutional investors was a key factor in pushing U.S. crude oil futures prices to a record $111.80 a barrel last month.
"This is a 24-hour casino with unbelievable speculation," said Democrat Byron Dorgan of North Dakota, who said he is pursuing possible legislation that would require U.S. commodity exchanges like the New York Mercantile Exchange to boost margin
requirements for buying and selling crude oil contracts.
Raising margins - collateral payments deposited by customers to insure against adverse price moves - could staunch the flood of money pouring into crude oil, gold and agricultural contracts, Dorgan said.
"I think there should be an increase in margin requirements," Dorgan told reporters, noting that crude oil contracts can be bought or sold for about 5 percent of their
nominal value, while stock purchases require a higher up-front cash outlay. Dorgan did not specify where he would like to see margins set.
In effect, someone who wants to speculate can control $100,000 worth of oil by investing only $5,000 to $7,000, Dorgan said.
Currently, exchanges set their own margin requirements, and raise and lower them as they see fit. A spokesperson for the New York Mercantile Exchange was not immediately available for comment.
Low margin requirements for crude oil and other commodities give market players "tremendous" leverage to control high-dollar contracts for a small amount of cash, said Sean Cota with the Petroleum Marketers Association of America.
Sarah Emerson, managing director of Energy Security Analysis Inc, agreed that crude oil margin requirements should be raised.
"That's one tool that Congress has," Emerson said, noting that the profit potential afforded by low margin requirements for crude oil is "striking."
"There really aren't any other easy fixes," Emerson said.
Sen. Jeff Bingaman, the committee's chairman, was noncommittal on the idea, though he said he was concerned by one panelist's observation that crude oil has become "the new gold" as a hedge against inflation and a weak U.S. dollar.
"I don't need to go buy gold every day to get to work," Bingaman said, asking panelists if Congress needs to "discourage investment in oil strictly as a refuge against volatility elsewhere" by "folks that have no earthly need to be
The California Public Employees Retirement System, the largest U.S. public pension fund, in February said it plans to invest up to $7.2 billion through 2010 in commodity markets.
An economist for the Commodity Futures Trading Commission told lawmakers that the share of outstanding NYMEX oil contracts held by speculators has increased only marginally -- from 31 percent to about 37 percent over the last three years.
Even the cries for higher margins grow louder the possibility itself may start to wring marginal players out and make institutions more leery of allowing clients this type of leverage.
It's the right move and Congress should act. (And encourage UK authorities to act similarly regarding the International Petroleum Exchange in London)