[Congressional Record (Bound Edition), Volume 148 (2002), Part 3]
[Senate]
[Pages 3958-3959]
[From the U.S. Government Publishing Office, www.gpo.gov]




  NATIONAL LABORATORIES PARTNERSHIP IMPROVEMENT ACT OF 2001--Continued

  Mr. REID. Mr. President, I ask unanimous consent that we proceed, 
once again, to the energy bill and the Feinstein amendment, and the 
Reid second-degree amendment be pending.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 3079

  Mr. REID. Mr. President, I commend the senior Senator from California 
for her amendment and her work on this very difficult issue of 
derivatives regulation.
  To critics of the amendment, I suggest you put yourselves in Senator 
Feinstein's shoes. She represents the largest State in the United 
States, whose gross domestic product is larger than most countries of 
the world. In fact, I understand that it has about the seventh largest 
gross domestic product of any entity in the world.
  Last year's energy crisis threatened California's prosperity and 
brought home to all of us that we are in unchartered territory with 
energy deregulation. We felt the same problems in Nevada.
  The collapse of Enron, a supposed leader in energy trading and 
markets, makes me wonder: How can we have a company such as Enron in 
this country, a publicly owned company, that changes in 1 year from a 
high flying, worldwide megacompany to a bankrupt loser with hundreds, 
if not thousands, of ruined lives in its wake? We have many 
congressional committees and prosecutors looking for the answers to 
that question, and many other questions.
  We owe Senator Feinstein a debt of gratitude for her interest in this 
issue and her work in proposing changes to the Commodity Exchange Act 
that will ensure that trading in energy derivatives is done in the 
open, with transparency, in a way that inspires public confidence in 
the markets.
  My amendment is necessary to restore metals derivatives trading to 
exempt commodity status. Senator Feinstein's amendment inadvertently 
included metals derivatives with the energy derivatives that are the 
intended target of her amendment. Like other derivatives, metals 
derivatives markets help companies manage the risk of sudden and large 
price changes.
  In recent years, derivatives and other so-called hedging transactions 
have helped the mining companies in my State cope with a steadily 
declining gold price by selling mining production forward. The last 
couple of years illustrate the function and the value in the 
marketplace of these transactions.
  Some companies decided not to hedge, betting that the gold price 
would rise and that hedging contracts would lock them into below-market 
prices. Most of those companies are no longer around because the gold 
price stayed relatively low.
  In contrast, other companies hedged some or most of their production. 
These companies have survived, and survived well, and some have even 
thrived. By choosing to manage their risk, they accepted the risk that 
the gold price could rise, but they stabilized company performance, 
continued to provide jobs, and continued to contribute to the 
communities in Nevada where they are so important.
  Unlike energy derivatives, which raise questions because of the 
recent energy crisis, metals derivatives have been traded over the 
counter for many years. The 2000 amendments to the Commodity Exchange 
Act did not change this; they only clarified and confirmed the legality 
of these markets. Lumping metals derivatives together with energy 
derivatives would impose regulatory burdens that have never existed, 
even before the 2000 amendments, without any justification.
  The amendment I have offered would not allow metals derivatives 
markets and participants to trade derivatives without accountability 
and transparency.
  The Commodity Exchange Act already requires adequate recordkeeping 
for these otherwise ``exempt'' transactions. This amendment adds 
additional recordkeeping requirements for exempt commodities that are 
comparable to those already in the Feinstein amendment for energy 
commodities.
  Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. REID. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. REID. Mr. President, it is my understanding that we are now on 
the Feinstein amendment and the second-degree amendment offered by the 
Senator from Nevada.
  The PRESIDING OFFICER. The Senator is correct.


                     Amendment No. 3079, Withdrawn

  Mr. REID. Mr. President, I withdraw my second-degree amendment.
  The PRESIDING OFFICER. Without objection, the amendment is withdrawn.


                Amendment No. 3081 to Amendment No. 2989

  Mr. REID. Mr. President, I send an amendment to the desk on my 
behalf, and we will wait until tomorrow to affix the name of Senator 
Crapo to this amendment. I believe he wants to cosponsor it.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:


[[Page 3959]]

       The Senator from Nevada [Mr. Reid] proposes an amendment 
     numbered 3081 to amendment No. 2989.

  Mr. REID. Mr. President, I ask unanimous consent that further reading 
of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The amendment is printed in today's Record under ``Amendments 
Submitted.'')
  Mr. REID. Mr. President, I have given a statement in relation to the 
amendment just withdrawn. This basically is the same but does not 
include some redundant requirements for recordkeeping. I simply state 
that I think the Senator from California, Mrs. Feinstein, is trying to 
do the right thing. But unless we adopt this amendment, the second 
largest industry in Nevada--mining--will be hurt very badly. Senator 
Feinstein's amendment would inadvertently harm mining companies in my 
state and throughout the United States.
  The metal derivatives market has been going on for many years. 
Lumping metal derivatives with energy derivatives would impose 
regulatory burdens that have never existed, even before the 2000 
amendments to the Commodity Exchange Act, without any justification. 
Unlike energy derivatives, which raise questions because of the recent 
energy crisis, metal derivatives have been traded over the counter for 
years and years with no problem. My amendment is necessary to restore 
metals derivatives trading to ``exempt'' status, which is critical to 
the health of the mining industry.


                             Cloture Motion

  Mr. REID. Mr. President, on behalf of the majority leader, I send a 
cloture motion to the desk.
  The PRESIDING OFFICER. The cloture motion having been presented under 
rule XXII, the Chair directs the clerk to read the motion.

                             Cloture Motion

       We, the undersigned Senators, in accordance with the 
     provisions of rule XXII of the Standing Rules of the Senate, 
     hereby move to bring to a close the debate on the Feinstein 
     amendment No. 2989 to the substitute amendment for calendar 
     No. 65, S. 517, the energy bill.
         Dianne Feinstein, Byron L. Dorgan, H.R. Clinton, Daniel 
           K. Akaka, Paul D. Wellstone, Edward M. Kennedy, Bob 
           Graham, Carl Levin, Bill Nelson, Debbie Stabenow, Maria 
           Cantwell, Harry Reid, Russell Feingold, Ron Wyden, 
           Richard Durbin, James M. Jeffords.

  Mr. REID. Mr. President, I ask unanimous consent that the mandatory 
quorum under rule XXII be waived.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________