OTC commodity derivative rulemaking at the CFTC, 2010-2016: a cultural political economy approach
Zedalis, Bryce Edmund
Rulemaking undertaken by the Commodity Futures Trading Commission (CFTC) between 2010 and 2016 for the regulation of over-the-counter (OTC) commodity derivatives comprised an essential component in the implementation of the post-financial crisis Dodd-Frank Act reforms. This study analyzes how the CFTC determined which OTC commodity derivatives would be regulated pursuant to the Dodd-Frank regime, examining the administrative agency’s rulemaking for commodity and trade options in addition to the so-called forward contract exclusion. The rulemaking analysis is informed by the theoretical framework of Cultural Political Economy (CPE). In following this analytical approach, this research identifies and assesses how semiotic and extra-semiotic factors interacted and co-evolved to influence how CFTC policymakers constructed the regulation of OTC commodity derivatives and, thus, variation in, and the selection and retention of, these officials’ codified regulatory stance(s) towards these same financial instruments. This study also posits a Dodd-Frank imaginary, and traces how, and explains why, it evolved over the multi-step OTC commodity derivative rulemaking sequence. It is demonstrated that, as well as explained why, CFTC policymakers’ construction of OTC commodity derivative regulations changed over the course of the six-year rulemaking span to largely exclude or exempt from regulation under the Dodd-Frank Act the OTC commodity derivative transactions of most marketplace participants.