Clinton Issues Proposal to Relieve Gas Pain

Clinton wants to penalize those who gouge consumers at the pump. She proposes both civil fines -- up to $1 million -- and criminal penalties of up to five years in prison for "unconsciously excessive" price hikes. Clinton found 15 instances where this penalty would have been applied to price manipulation after Hurricane Katrina struck in 2005.

Clinton called on the Federal Trade Commission (FTC) to increase scrutiny on and take action against market manipulation. The 2007 energy bill boosted the FTC's power to investigate violators. Clinton points to a reported abuse in 2003. Marathon Oil(MRO Quote) paid a $1 million fine to the Commodities and Futures Trading Commission to settle charges of market manipulation.

Other factors affecting the market concern Clinton. She thinks the "Enron loophole," meaning electronic traders in energy markets being inadequately supervised, has to be closed. She's slightly off base here. Enron traders traded derivatives related to the price of energy (electricity) in states like California and dealt with power production and transportation. These markets are more closely tied into natural gas than crude oil. Using the phrase "Enron loophole" creates unnecessary fear.

Clinton's proposal comes at a critical point in her campaign. She just came off a solid win in Pennsylvania and hopes to build on that momentum May 6 in both Indiana and North Carolina. A Gallup poll over weekend showed Clinton moving back into a near tie with Sen. Barack Obama (D., Ill.) and beating McCain in a general election contest.