Once upon a time, a number of senators were concerned that there might be more Enrons just waiting to happen. As a result, they passed a bill called after the two main senatorial sponsors. Sometimes, like the non-winning ball team from Chicago, the law is just called “SOX.”
Now, a number of senators are concerned that, well, I think they are concerned that business is not sufficiently regulated to remove all investment risk, or something like that. So they passed a new bill. John at Power Line is wondering what happened:
By the way, speaking of reform measures, have you heard much about Sarbanes-Oxley lately? Wasn’t that “reform” supposed to clean up Wall Street? To my knowledge, every expert in the field says that the net effects of Sarbanes-Oxley have been negative. Is there any reason to expect anything better from the current package?
I believe that last question to be rhetorical, but in case it is not I’ll say “No” as in “No, I do not have any reason to expect the current package to provide anything more than SOX has”–which has been a whole raft of new regulations which require business to fill out more paperwork, get more audits, add up more columns and for what?
I worked closely with accountants and auditors for a little over a year when SOX first came out. I documented hundreds of processes and worked to ensure that we dotted all the i’s and crossed all the t’s. For what? Well, the auditors and I got paychecks. The accountants got a lot more forms to fill out–at the same time they were trying to make more money for the business. The company’s customers got all the costs passed on to them in terms of increased costs and Congress got to rest on its laurels thinking that all was well and Kenneth Lay could no longer disturb the well-earned rest of the American investor.
Anyone who does not understand that the federal government is using this bill to further tighten its control over American businesses to the end that the government chooses the winners and losers–and does not allow the market to do so–is remarkably disengaged from reality.