Cicilline Bill Would Target Rampant Oil Speculation


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Congressman David Cicilline introduced a bill today that would curb rampant speculation in the oil markets, which would both drive down the price at the pump and put the petroleum economy back in line with the laws of supply and demand, he said.

“If you look at what has happened in the market, production is up and demand is down,” Cicilline told me today. “So the market is not working right. And a substantial piece of this is excessive speculation. Wall Street is using oil futures as a gambling casino.”

Though they’ve inched back down recently, oil prices have skyrocketed in 2012. The national average has climbed from $3.34 in mid-January to $3.87 today. In Rhode Island during that same time period, the average price of a gallon has gone from $3.50 to $3.97.

During the gas price spike in 2008, the exact same piece of legislation passed the House by an overwhelmingly bipartisan vote of 402-19.

The bill, which is co-sponsored by Congressman Maurice Hinchey (D-NY) and Congressman Raúl Grijalva (D-AZ) would compel the US Commodites and Futures Trading Commission, the entity that regulates such speculation to put new rules into place to negate the effects of speculation on the price at the pump.

Cicilline said the CFCT could set greater limits on how many future shares one entity could own at a time or set limits on how much of the oil market could be designate for futures trading.

“This is dangerously reminiscent of what we saw in the housing market when Wall Street was using very sophisticated tools to drive up prices,” he said. “We’re not powerless to respond to this crisis.”

The futures market controls about 80 percent of all crude oil, said Gary Gensler, the Chairman of the CFTC, recently. Cicilline added that that percentage has doubled in the past decade and shortly before that futures trading controlled only about 20 percent of the market. Cicilline said Goldman Sachs is the biggest holder of crude oil futures.

President Obama called for further regulation on oil speculation earlier in the week. Sen. Bernie Sanders (I-VT) is sponsoring similar legislation in the Senate.

Speculation occurs when investors buy “futures” in a commodity such as oil. In effect they purchase a credit to buy a barrel (or many, as is often the case) at a price set now and collect the oil at a future date. If the price is higher than they bought the future share for, they make money. The problem occurs when many investors purchase future shares, artificially driving up the price beyond what it costs to extract, refine and deliver.

See Gemma Run


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Anthony Gemma

 

Anthony GemmaDark clouds hung over Providence’s Prospect Terrace Park as businessman Anthony Gemma, lately of Mediapeel, said, in a roughly 15 minute speech, that he would bring “change” and “new ideas,” while redefining what service meant for the office of U.S. Congressman.

While the congressional hopeful spoke, supporters looked on, and a quartet picnicked despite the light sprinkling of rain. Cupcakes and cookies were laid out for the decently sized crowd.

Mr. Gemma attempted to put his candidacy in the paradigm of former Democratic Party presidents like Franklin Delano Roosevelt and John Fitzgerald Kennedy, whose New Deal and New Frontier programs, respectively, remain major touchstones of the Democratic Party.

Thus Mr. Gemma introduced that his candidacy would run under the theme of the “New Idea”. However, he did not once say what that New Idea would be, leaving the door open to speculation.

Mr. Gemma also said that there was a very real chance that the Democrats could win back control of the House of Representatives this election, and that it might be as close as one seat. He said that he had the best chance of defeating Republican nominee Brendan Doherty in November, though polls show him in a poor position against Doherty, with a large portion of the electorate undecided.

In a speech that was big on sweeping abstractions like “vision,” “courage,” and “confidence,” Mr. Gemma mentioned only that he had a jobs plan, not what was in it. No single concrete policy was announced, only that they would be rolled out over the course of the campaign. He claimed he shared the same anxiety and anger as many voters in the 1st Congressional District.

Anger was a major theme of the speech, as Mr. Gemma attacked Mr. Doherty for having “zero understanding” of how to create jobs. Claiming that Mr. Doherty was a creature of the public sector, Mr. Gemma said that he alone of the candidates for the office of U.S. Congressman understood how to create jobs. But as for his opponent in the primary season, incumbent Congressman David Cicilline, Mr. Gemma never once deigned to mention him by name, instead making a veiled reference to Mr. Cicilline’s recent apologies by saying “I won’t have to apologize to you for lying so that I can win your vote.”

He never once made clear how he intended to take on Mr. Cicilline, who has the support of the Governor, the Treasurer, the current Mayor of Providence, the rest of Rhode Island’s congressional delegation, and a massive advantage in funding. Perhaps though, the cross-section of politicians Mr. Gemma rallied to his conference offers some insight. Mr. Gemma thanked Providence councilmen Davian Sanchez, Wilbur Jennings, and Nick Narducci for attending, along with former mayors John Lombardi of Providence and said that Charles Lombardi of North Providence had not yet arrived.

Upon finishing his speech, Mr. Gemma made a beeline towards the park’s exit, working only the part of the crowd that stood between him and the street, as the press tagged along. He then climbed into a waiting GMC sports utility vehicle and drove away, prompting one supporter to exclaim that the press had chased him away from his own press conference.

RI Progress Report: Congrats to Tear and Ryherd


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Congratulations to Allan Tear and Soren Ryherd, who will each be awarded innovation fellowships from the Rhode Island Foundation. The two entrepreneurs will receive grants for $300,000 over the next three years for their winning projects that will – hopefully – help revitalize Rhode Island’s struggling economy.

David Cicilline apologizes for misleading voters about the fiscal stability of the Capital City as the former mayor ran for Congress in 2010.

A lawyer for Google said Rhode Island’s US Attorney Peter Neronha had gone “off the reservation” when he accused CEO and search engine co-founder Larry Page of knowing about illegal activity by the internet behemoth.

Welcome to the Buffett Rule beat, Dan McGowan! Also today, the New York Times editorial board weighs in on Sen. Sheldon Whitehouse’s bill.

This just in: “Hundreds of nurses and their fellow union members at Women & Infants Hospital are picketing today and calling on Hospital administrators to improve staffing levels by lifting a months-long hiring freeze and hiring local nurses for permanent positions – instead of staffing with temporary, subcontracted “traveler” nurses as proposed.”

The CRMC sided with the Ocean Mist and several environmental groups and didn’t allow South Kingstown to construct a steel wall between the beach and Matunuck Beach Road.

Newt Gingrich bounces a check to Utah.

One of the weirder things about the deal Bob Flanders struck with Central Falls retirees is that it required the General Assembly to sign off on a $2.6 million bailout to the retired employees who had their pensions cut.

This page may be updated throughout the day. Click HERE for an archive of the RI Progress Report.

Cicilline Calls for House Passage of Buffett Rule Bill


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Congressman David Cicilline has joined the Buffett Rule movement, calling on Speaker John Boehner to pass the House version of Sen. Sheldon Whitehouse’s Paying A Fair Share Legislation.

“Under current tax laws, working men and women may be asked to pay a higher percentage of their income in taxes than wealthy individuals, many of whom derive a significant portion of their earnings from capital gains,” Cicilline wrote to Boehner. “Although there are many issues on which we may disagree, surely both Republicans and Democrats must acknowledge that there is something wrong with a system that asks a Fortune 500 CEO to pay a lower tax rate than his or her secretary.”

The House version of the bill is being sponsored by Rep. Tammy Baldwin, D- Wisconsin. In a conference call yesterday with Sens. Whitehouse and Chuck Schumer, D-NY, she said her constituents believe “our tax system rigged against middle class families and quite frankly it is.”

The Senate is expected to vote on the bill April 16. Yesterday on the conference call Schumer and Whitehouse said Democrats hope to pick up a few Republican votes. No date has been set yet for a House vote on the bill, where its chances of passing are less optimistic.
Here’s the full text of Cicilline’s letter to Boehner:

Dear Speaker Boehner,
For much of the past year, public attention has been focused on the issues that divide us as Democrats and Republicans as well as the partisan tactics and extreme rhetoric that has been used in pursuit of conflicting priorities. But at a time when our economic recovery is still struggling to take hold, and with my home state of Rhode Island now experiencing the second highest unemployment rate in the country, working families want to see Washington put aside partisan rhetoric in favor of pragmatic solutions to the challenges we face.

One of the most urgent areas of concern lies in reforming our tax structure. As you know, under current tax laws, working men and women may be asked to pay a higher percentage of their income in taxes than wealthy individuals, many of whom derive a significant portion of their earnings from capital gains. Although there are many issues on which we may disagree, surely both Republicans and Democrats must acknowledge that there is something wrong with a system that asks a Fortune 500 CEO to pay a lower tax rate than his or her secretary.

Last week, President Barack Obama reiterated his call for Congress to institute the “Buffett Rule.” My fellow Rhode Islander, Senator Sheldon Whitehouse (D-RI), has introduced legislation in the U.S. Senate, that would ensure multi-million dollar earners pay at least 30% of their income in taxes, which would ensure parity with taxes imposed on middle class families.    The Senate has scheduled a vote on this legislation, the Paying a Fair Share Act, S. 2230, for April 161h.    As you know, Congresswoman Tammy Baldwin (D-WI) has introduced the House companion to Senator Whitehouse’s bill, H.R. 3903, which I have cosponsored.

As millions ofmiddle class Americans struggle to make ends meet, and with the President calling on Congress to act, I believe we must put aside partisan differences and do the right thing for our country by considering this commonsense proposal. I strongly urge you to take all necessary action to ensure that legislation instituting a “Buffett Rule” is brought to a vote when the U.S. House of Representatives returns to session.

I thank you in advance for your consideration and look forward to your response.

The Chafee Endorsement Matters For Cicilline


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Governor Lincoln Chafee (Independent)

The big political news of the yesterday was Governor Lincoln Chafee’s endorsement of U.S. Representative David Cicilline for Congress in 2012. First, Chris Fierro of Mr. Cicilline’s office tweeted last night that Gov. Chafee attended a fundraiser for the incumbent representative.  Then the Governor’s office confirmed as much in this statement.

There’s a danger of reading too much into this, but it appears to be a good sign for both Mr. Cicilline and Gov. Chafee. It definitely hurts the campaign of Mr. Cicilline’s challenger Brendan Doherty, who could’ve bolstered his argument of being an acceptable Republican for Rhode Island by winning Gov. Chafee’s endorsement, Rhode Island’s last federal delegation Republican (it’s unlikely Mr. Doherty ever sought the Governor’s endorsement). But with no non-Democratic statewide officeholders left to endorse him, Mr. Doherty will have to rely on obscure RIGOP apparatchiks, conservative media, and the nationally-despised national Republican Party.

Mr. Cicilline won’t be overly-bolstered by this endorsement. As Mr. Nesi points out, the Governor and the Congressman are the two most disliked politicians in Rhode Island right now (of those politicians included on polls). If this was two years ago, such an endorsement might’ve shored up Mr. Cicilline’s progressive supporters, which it will somewhat help to do now. But Governor Chafee is not the same as Candidate Chafee, and his low poll numbers are likely due to a collapse in support from the labor-progressive coalition that propelled him into office in 2010. It does mean that potential Democratic primary opponent Anthony Gemma is increasingly isolated in Rhode Island’s political landscape.

I think Gov. Chafee actually benefits the most from this endorsement. There’s no doubt that the Governor has been pulling reliable duty as a Democratic Party workhorse; co-chairing President Barack Obama’s re-election committee, endorsing Senator Sheldon Whitehouse who ousted him from office, appearing with Providence mayor Angel Taveras, and now this. If the Governor makes the switch from Independent to Democrat, he might might be able to get more cooperation from the General Assembly in time for 2014, perhaps preside over a few legislative successes and stay in the limelight by virtue of party affiliation.

His fortunes are tied to those of the state’s of course, and Democrats might prefer that the Governor remains apart; setting up what could be an easy pick-up for current Treasurer Gina Raimondo without the risk of an unpopular candidate harming any down-ticket party members.

Join Me for a Free Tax Preparation Clinic


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During these tough economic times, I want to make sure that every family in the First Congressional District has access to the federal resources available to them. That’s why I hope you can join me a for a Free Tax Preparation Clinic at 9:00 AM this Saturday, March 31st, at the Boys and Girls Club of Pawtucket. At this event, constituents with an annual income below $50,000 annually will be able to prepare and file their taxes with IRS-certified volunteers, who will also be able to provide information about special tax credits for which you may qualify, including the Earned Income Tax Credit and the Child Tax Credit.

Click here for more information on this upcoming event. To RSVP, please call Lisha Gomes in my Pawtucket office at 729-5600.

Cicilline Comes Out Strong Against GOP Budget Bill


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On the Huffington Post and on the House floor, Congressman David Cicilline has come out strong against the House GOP budget proposal.

Today, after voting against it yesterday, he penned an op/ed for the Huffington Post today critical of the bill writing, “less than a year after a similar proposal was defeated, the House Republican leadership held a vote on a budget proposal that would extend tax cuts for the wealthiest Americans, make deep cuts to programs that serve middle class families and end the Medicare guarantee for our seniors.”

Cicilline spoke out against the bill earlier in the week saying, “My home state of Rhode Island has one of the highest unemployment rates in the country. My constituents need common-sense solutions that will create jobs and get our country back on the right track not another extreme proposal from the House Republican leadership.”

He said the bill would give the richest Americans an average tax break of $150,000 a year.

The top-down budget proposal passed the Republican-controlled House largely along party lines. Politco said of the bill:

“Just 10 Republicans defected, and the 228-191 vote gives the embattled GOP leadership what it most wanted: a show of party unity behind a bold election-year vision that includes new private options for Medicare and a simplified Tax Code. But the price paid by Congress will be big: wrecking havoc with hard-fought bargains under the Budget Control Act and inviting another shutdown fight with Senate Democrats and Obama unless the House again reverses course.”

Poll: Not looking good for Democrat David Cicilline


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The big story to come out of WPRI’s poll last night is that Republican challenger Brendan Doherty is “crushing” incumbent Democrat David Cicilline in their contest for the right to represent Rhode Island in the 1st Congressional District.

According to the poll that surveyed 250 Rhode Islanders, Doherty would garner 49 percent of the vote while Cicilline would pull in just 34 percent, with 16 percent undecided.*

This should serve as a call to action for both Democrats and progressives. If you can’t support Cicilline, it’s time to start recruiting David Segal to run again for the seat, as well. Or else find a dark horse.

More on what a three-way race might look like below…

__________________________

I held off on taking another look at David Cicilline in the primary until WPRI’s poll numbers were out (I distrust Brown polling). Well, here they are. True to form, WPRI shows a slightly different situation than Brown’s, even where all of Rhode Island was asked. Brown put Mr. Cicilline’s approval rating at 14.8%. The WPRI poll shows Mr. Cicilline at 19.6%, which is slightly better.

I think the WPRI poll is superior for those attempting to divine the future, if only because it actually puts head-to-head match-ups between Republican Brendan Doherty and Mr. Cicilline, along with potential Democratic challenger Anthony Gemma. While Mr. Gemma appears that he would handily lose in a race between him and Mr. Doherty (although not enough people know either, so there are a lot of not sures), Mr. Cicilline at least has a base of support to build from; the 18-39 year olds and members of the Democratic Party. Interestingly, union members are more pro-Doherty than pro-Cicilline (who’s better off with non-union voters), probably a sign that Cicilline’s last-minute deal with the Providence Fire Fighter’s IAFF Local 799 before his campaign hasn’t boosted his union credentials, nor has his service to the Democrats in the U.S. House of Representatives.

Last time I evaluated this, I said that a primary could shape up into essentially one of five choices: Mr. Gemma runs again and loses, Mr. Cicilline collapses, Mr. Cicilline defeats a centrist, either David Segal or Mr. Gemma triumphs in a three-way race against Mr. Cicilline, or a three-way race is a boon to Mr. Cicilline. The basic thought was that it’s more likely for Mr. Cicilline to win in a primary. Indeed, that still seems likely. For one thing, the Democratic Party has circled its wagons around Mr. Cicilline, and Mr. Gemma, an independent before 2010, is unlikely to excite Democratic partisans, and is unlikely to be able to get figures in the state Democratic Party to abandon Mr. Cicilline. Is there anyone capable of defeating the incumbent Representative in a Democratic Primary?

Scott MacKay appears to be wondering the same thing. Things haven’t improved for Mr. Cicilline since the last time WRNI did a poll in May of 2011. Having failed to address the issue last year, the campaign is likely to be a referendum on Mr. Cicilline, when it should be a referendum on the U.S. Congress. If Mr. Segal decides to run, or Mr. Gemma, both will have to be radically different candidates, and will face a name recognition problem much as Mr. Doherty has faced. They’ll also be facing the fact that their potential donor pools are the same as Mr. Cicilline’s, making it harder to raise money against him.

While Mr. Cicilline does have a sizable war chest, the question is if that money will matter in a general election. Where it will matter is in a primary election; but unfortunately for Mr. Gemma, his inclusion in the polling undercuts the notion that he might be more electable than Mr. Cicilline. One of the interesting things about small races like these is how polls can influence perceptions of electability, and candidates largely need to operate between infrequent polling to make their mark. A single poll can show the emperor has no clothes; and bad polls can cause serious damage. For the time being, Mr. Cicilline appears to have nothing to shield himself with. A non-Cicilline or Gemma candidate looking to jump in might start now while the pollsters are napping.

This might also be the void that either an independent or a Moderate could step into. Lincoln Chafee eked out a close win by appealing to progressives and the base of support he had built up during his tenure in the U.S. Senate. It’s not inconceivable that an independent could avoid the trouble of a Democratic primary while utilizing an aggressive media strategy to get their name in the news. This might also be the race that the Moderate Party could attempt to take on, but no candidates seem to be forthcoming, indeed, the Moderate Party has not even deigned to issue attacks on either candidate. There might be some advantages for an independent or Moderate candidate, since both national parties have damaged their brands severely over the last few years.

That’s ultimately the issue. We’re looking for a candidate who can be stronger than Mr. Cicilline and can overcome a large gap in name recognition relatively quickly. Providence Mayor Angel Taveras and State Treasurer Gina Raimondo leap to mind, but I think Mr. Taveras is dedicated to fixing Providence (such a run would open him up to the same criticisms as Mr. Cicilline) and that Ms. Raimondo has bigger offices she might be aiming for. Furthermore, neither seem likely to anger any of Mr. Cicilline’s Democratic backers, especially since Mr. Taveras is largely surrounded by them.

A dream candidate for Democrats would be someone capable of rallying Rhode Islanders with a hopeful message while being relatively unconnected to Providence’s financial woes. This would shift the referendum on Mr. Cicilline into the primary and would allow for a general election to focus on national issues, which should favor Democrats slightly as Tea Party Republicans have caused serious problems for their party’s favorability. The major issue here is that Mr. Doherty has yet to take any serious positions, meaning that he is largely the anti-Cicilline in the race. Republican voices were largely condemning Mr. Doherty as a Democrat in Republican clothing during the primary before John Loughlin dropped out. If Mr. Doherty is a Republican in the Chafee mode, he may be less objectionable to voters.

__________________________

*Update: Nicole Kayner of Mr. Cicilline’s campaign has given us the following statement about the poll:

“People are struggling right now and they are not satisfied with the response they are getting from Congress. David understands that. He is working hard every day to do what he can in this tough economy.  Last year, his district office has helped over 700 Rhode Islanders solve problems like navigating the Veterans Administration and tracking down Social Security checks and Medicare payments. Most recently, he held a housing fair where hundreds of Rhode Island families who were either facing foreclosure or are having trouble making their payments were able to receive assistance from lenders and housing agencies. David remains focused on doing everything possible to help middle-class Rhode Islanders get back on their feet.”


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