The global markets committee, established more than a decade ago, is only one of some 900 formal advisory groups scattered across the government. Altogether, 65,000 committee members counsel more than 55 agencies, the Government Accountability Office said last year. By advising agencies such as the EPA, FDA and Energy Department, they influence standards for food safety, environmental protection and energy use.
Advisory committees can afford their members — often industry players or technical experts with a vested interest in agency decisions — unfettered access to regulators and a platform to advance arguments in Congress. In some cases, agencies have faced legal challenges for ignoring advisory committee recommendations.
“These committees can be really important and have a lot of influence,” said Wake Forest University law professor Sidney Shapiro, a specialist in administrative procedure and regulatory policy. “It’s hard to generalize, but this is cause for worry, and the public interest is disadvantaged.”
The global market committee’s charter requires it to “serve as a channel of communication” that includes “end users most directly involved in and affected by market globalization.” The charter further specifies that “market users” must be members.
But none of the committee’s members represent ordinary consumers, who may face hardships from the effects of speculative commodities trading, whether at the gas pump or from fluctuating prices of electricity. Even so-called end users — major industries such as airlines or power companies that use derivatives to hedge their risk — have no seat at the table.
That soon may change. Last week, the Huffington Post Investigative Fund contacted the CTFC about the committee’s membership. In an e-mail Monday, a spokesman said the agency is “in the process of expanding the committee membership to include end users.” The spokesman declined to specify who may join.
Seeking More Balance
Sommers, the CFTC commissioner and chair of the advisory group, was a top lobbyist for the International Swaps and Derivatives Association, the main trade group representing those working in the $600 trillion-a-year privately negotiated derivatives markets. Sommers’ former boss and current chief executive officer of the swaps trade group, Robert Pickel, is on Sommers’ committee.
Sommers also was a lobbyist for the Chicago Mercantile Exchange, now CME Group, where some derivatives are traded. The exchange’s chief executive and one of its board members also are on Sommers’ committee.
Among the committee’s other members: Richard Berliand, JP Morgan’s worldwide head of futures and options; Bonnie Litt, a managing director of Goldman Sachs; and Robert Klein, managing director and associate general counsel of Citigroup Global Markets. The committee also includes a registered lobbyist, Joanne Medero, who heads government relations and public policy for Barclays Global Investors.
