The US should subsidize the development of a national commodity exchange
Debate Rounds (3)
I will be arguing the institution of a national commdoity exchange subsidized by the US government. For the purpose of the debate, we shall refer to it as the US National Commodity Exchange, or USNCE for short.
- The USNCE will be a national marketplace designed for the buying and trading of all commodity goods.
- The USNCE will deal in international and national commodity exchanges.
- The USNCE will be supervised by a federal commision, and subjected to the US department of customs.
- All commodity trades within the nation will be subjected to a low commodity tax, at a 10% rate of purchase.
- The USNCE will come with a online format, and commodity resources will be kept as credits until trades are completed.
This proposal is a result of a lot of thinking I've been doing on inner growth and racket stimulation. The US has several commodity exchanges, most prominent being the Chicago Board of Trade. Unfortunately, the US has never had a commodity exchange that services all legalized products, or is truly nationalized.
I have great intrest in doing this debate, and I hope a expierienced and intelligent opponent accepts this debate.
Basic answers for your response: How would your federal commission gain the power to prosecute crimes? There is already an endless array of committees in Washington. The senate even had the financial inquiry commission which found securities fraud and other crimes but they did not have the power to prosecute individuals or individual firms. Why the U.S. department of customs would supervise a "national exchange" since by definition their jurisdiction does give them authority to regulate to do so. Again, if this is what you are suggesting, please state first how this exchange can "deal and international and national commodity[ies]" under existing law. Second, how do you suggest changing the structure of U.S. custom"because the FTC, SEC, and DOJ regulate every other exchange and are authorized under law to do so.
For the next round please provide precise language about "commodity" as well as "national commodity," because as stated in the proposal it is meaningless. What "national commodities" are you talking about? Is a commodity air and water? You state that all commodities"and air and water as well as nuclear waste and pollution are commodities, or are these commodities exclude from "all commodity goods [?]"
Even all this is made clear in your response, how will the US government subsidize this exchange? What kind of subsidies will individuals, companies, hedge funds, et cetera receive and what is the purpose provide benefits for only such groups? In addition, your exchange financially is designed to fail. 10% to execute a trade? Why would anyone want to pay 10% on a trade when they could simply use other exchanges that charge less than fractions of a penny?
Also how will you regulate derivatives and futures trade on this exchange? How will you prevent front running and manipulation by high frequency trading firms? Would your exchange allow short selling, what about naked short selling? You also say that it will be an online format, what agency will be tasked with maintaining the integrity of your exchange given the endless way people can manipulate IP Addresses, masks their location, to prevent people in other countries from undermining your exchange. Will it be legal for an American to use your exchange in Europe?
ChosenWolff forfeited this round.
I want to start the debate by stating, that I am arguing the US should instate a national commodity exchange. I am not arguing that I should start my own corporatation and manage every idea. I appreciate the oppositions aptitude for asking questions, and I will answer as many as I can, but there is a fine line between debating the institution of a policy and arguing every little minor detail for it. For example, imagine me and the opposition were arguing National Healthcare. I would be required to prove national healthcare could work, but not write my own bill for it. My opponent is asking for something that can't be summarized in 8000 characters, and even if it could, is not required for the BOP. You see, I only need prove that a national commodity exchange within the boundaries of the 4 bullets would work. Not the million bullets that were straw manned. Which is why it is preferrable to wait for your opponents opening arguments before asking questions. So, I hope this is clear to my opponent and the audience. I am required to debate this like any other debate. Not draft a bill solely for the purpose of a three round debate.
And I apologize for forfeiting, and I didn't do this on purpose. I was busy that day, and this slipped by me. With that said, I don't appreciate the rudeness that appropriated from my forfeit. That was outright uncalled for.
My opponent has asked many questions, and as I said, I'm happy to answer all the ones relevant to the debate. Although he makes it very easy, as this institution exists in several nations already. Not to mention that there are several commodity exchanges that coexist within Illinois, that operate in the exact same manner I have layed out.
- My opponent brings up questions on multi national corporations. I take it he doesn't frequent the stock market much? A commodity exchange operates not much differently from a stock, forex, or bond exchange. Multi Nationals invest by paying from their accounts. My opponent made a uncharged claim, and the process is as simple as applying your investment under you corporations name. As done with several commodity exchanges. My opponent seems to be confusing market exchanges with funnel banks. Which makes me wonder if he even knows what a commodity exchange is.
- Second question my opponent brings up, is regarding commisions. Seriously? My opponent does know that we are talking about institutions in the vein of USFR and not washington commitees. There is nothing more to say here. My opponent got commitees confused with commisions. Anyways, I'll clarify regardless. The New York Stock Exchange is oversaw by a commision. Several energy exchanges are oversaw by commisions. Hell, we have 21 for profit corporations that are ran by federal commisions. They are simply appointed by the government to oversee something. It is not their duty to prosecute crimes, or whatever nonsense my opponent has confused commisions with. This can be scrapped up as a simple misunderstanding of the resolution. He should of questioned in the comments if he didn't know a definition. Commsions, as I said, are appointed like any of the other million we have by the US customs department.
- My opponent made an outright silly question regarding commodity. He assumed that people were forced to trade through the exchange. For example, he stated that people would have to buy water and air from an exchange. This is silly nonsense. If my resolution doesn't say that you are forced to buy from the exchange, then you don't have to. Water can be bought and sold like normal, just as every other commodity can. Exchanges simply serve as a more efficient method. to do so. Honestly, my opponent shouldn't of made a straw man like that. It actually made me LMAO.
- The opposition has raised a question on subsidies. Very simple. You just stimulus spend until a company gets off the ground willing to follow your guidelines. I think its upsetting that we have 9 commodity exchanges, but buyer and sellers are forced to go through Indian and European exchanges. We are behind in this area. Also, the commodity exchange can be self sufficient through a 10% product tax. COE is a prime example.
- My opponent has brought up the only worthwhile question thus far, and the only problem that is US specific, and has been solved in other nations who have instated commodity exchanges. Immediately I noticed he didn't understand what a commodity tax is. He says "why would anyone pay 10% when commodities cost a fraction of a penny". First of all, no commodity costs a fraction of a penny. Commodities are raw materials, and no one purchases silk for .2$. Even so, you're only paying 10% of the exchange, or for example, 10% of the cost of the commodity you buy. This functions in the same manner as a sales tax. Also, futures are not raw materials and therefore are not comodities. The opposition has shown a complete lack of knowledge for what he is debating.
- Final question the opposition asks is how to prevent firm manipulation. This is not the problem of CE's alone. This exists in every exchange, although the opposition keeps showing that he doesn't know what he's debating. He thinks this is a futures or stock exchange, which is why arguing this is frustrating. Firms do not control the rates of commodity prices. Anyone who studies energy markets knows that trends go up and down from a stagnant starting point. Unlike stocks where the share price is determined by the firm, the prices are entirely that of the seller. The good thing about commodity exchanges, is that investment firms are not needed for the process to run, so it can't be manipulated.
III) Benefits of a National Commodity Exchange
Over the course of this debate, my opponent has shown an inabillity to comphrehend what we are arguing. I don't blame him. My resolution looked strikingly simmalar to the institution of a national stock exchange (which we have), but at the end of the day, that is not what were arguing. The US is behind in terms of promoting trade and economic movement. Most of our trading is done in the form of buying shares to commodities overseas. Unlike several smart nations, who found it beneficial to control the commodities and not the shares to commodity companies, the US is stuck using overseas economic stimulation. Why is the USNCE beneficial? Simple. Americans need an internet market where they can buy and sell goods.
That is ALL my proposal is advoccating for. A online market, regulated by the federal government, where people can buy and sell commodities. The state of Illinois owns 7 commodity exchanges, but where are the people of Texas buying their goods? How is New York stimulating food consumption? The simple answer is through buying imports. Imports cost tariffs, and national buying and selling does not. There is a major flaw in my opponents debating style. He choose to argue all the troubles that setting up an institution would take. He already conceded that there are several commodity exchanges already existing in the US. What he didn't concede, is why we can't have one more. The same questions he asked have all been explained through existing systems. This is no different from the 100 or so exchanges internationally. Until my opponent can provide proof that a market for the buying and selling of commodities among the American people is bad, the BOP is 100% affirmed.
I thank Con for the fun debate. Sorry I forfeited. As I said, completely forgot. For my sources, I provided the links to actual working commodity exchanges which follow the exact same system I provided, and are 100% successful. There is no more need to be behind in trade. This has worked for every country its been implimented in. It can work for ours as well.
"Today, banks like Morgan Stanley, JPMorgan Chase and Goldman Sachs own oil tankers, run airports and control huge quantities of coal, natural gas, heating oil, electric power and precious metals. They likewise can now be found exerting direct control over the supply of a whole galaxy of raw materials crucial to world industry and to society in general, including everything from food products to metals like zinc, copper, tin, nickel and, most infamously thanks to a recent high-profile scandal, aluminum. And they're doing it not just here but abroad as well: In Denmark, thousands took to the streets in protest in recent weeks, vampire-squid banners in hand, when news came out that Goldman Sachs was about to buy a 19 percent stake in Dong Energy, a national electric provider. The furor inspired mass resignations of ministers from the government's ruling coalition, as the Danish public wondered how an American investment bank could possibly hold so much influence over the state energy grid."
Taibbi adds, "Allowing one company to control the supply of crucial physical commodities, and also trade in the financial products that might be related to those markets, is an open invitation to commit mass manipulation. It's something akin to letting casino owners who take book on NFL games during the week also coach all the teams on Sundays."
The Pro side introduced a debate anything the commodity exchange he imagined. After forfeiting the second round, Pro then went on to make claims that are not true of commodity exchanges and were not true in terms of the points I initially raised. Commodity Exchanges trade in raw commodities, futures contracts, and derivatives. My opponent mentioned I said you could buy commodities for pennies. I will concede being inarticulate; however, the SEC page for prospective investors even reveals that can buy or sell"by that "execute buy and sell" orders through an exchange for pennies. I admit in previous rounds this was not made as clear, but I wanted to include that in these final remarks.  Finally, it is unclear why we would want to open up a national commodity exchange in the US, as it has been used recently as another avenue for extreme manipulation. Large financial institutions with a dubious interest in the actual commodities have begun to buy physical commodities, simply to hoard and use as guarantees for speculative bets in the derivatives market. Pro forfeited the second round and did not even make an argument for his side. VOTE CON!
2 votes have been placed for this debate. Showing 1 through 2 records.
Vote Placed by Malacoda 2 years ago
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Reasons for voting decision: RFD in comments.
Vote Placed by joepbr 2 years ago
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Reasons for voting decision: This was a bit confusing, Con was a little too fast in making assumptions and, I believe didn't fully understand the resolution, although this should be partially blamed on Pro, who should have been more clear in R1, also, the fact that Pro forfeited R2 prevented the debate from being well structured. Nonetheless, even after Pro's explanations and arguments, Con's only rebuttal seems to be that the US already have commodity exchanges, but that's already recognized by Pro, the resolution calls for a nationalized commodity exchanges instead of several localized and specialized ones, a proposal which is not properly countered by Con.
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