Jobs Bill a regulatory race to the bottom? (some think so)

[dayman]

http://therealnews.com/t2/index.php?option=com_content&task=view&id=31&Itemid=74&jumival=8166

 

Wall Street is, of course, broadly supportive. What this is is the industry's great desire to weaken Sarbanes–Oxley. Sarbanes–Oxley was the reform law passed after the Enron-era scandals, and it has always been Wall Street's dream to weaken that law.

 

People forget that Hank Paulson, the Treasury secretary under Bush, that was his leading objective. As the crisis was building up in mortgages, Treasury, the United States government, did nothing to stop the crisis. Why? Because Treasury was focused 100 percent, in terms of priority, in instead weakening Sarbanes–Oxley. So, yes, Wall Street loves anything that will allow them to start the process of gutting Sarbanes–Oxley.

This law, the Jobs Act, which of course begins by torturing the English language to create this acronym, is premised on precisely the logic—if you can call it logic—that led to our recurrent crises. The logic is the regulatory race to the bottom, that we need weaker rules than the City of London, because otherwise the people will move their offerings to the City of London, where it will be easier to commit fraud. And, of course, if we weaken our rules, then the City of London will weaken its rules, and then that'll be the excuse for us to weaken our rules further.

[GG]

http://therealnews.c...74&jumival=8166

 

Wall Street is, of course, broadly supportive. What this is is the industry's great desire to weaken Sarbanes–Oxley. Sarbanes–Oxley was the reform law passed after the Enron-era scandals, and it has always been Wall Street's dream to weaken that law.

 

People forget that Hank Paulson, the Treasury secretary under Bush, that was his leading objective. As the crisis was building up in mortgages, Treasury, the United States government, did nothing to stop the crisis. Why? Because Treasury was focused 100 percent, in terms of priority, in instead weakening Sarbanes–Oxley. So, yes, Wall Street loves anything that will allow them to start the process of gutting Sarbanes–Oxley.

This law, the Jobs Act, which of course begins by torturing the English language to create this acronym, is premised on precisely the logic—if you can call it logic—that led to our recurrent crises. The logic is the regulatory race to the bottom, that we need weaker rules than the City of London, because otherwise the people will move their offerings to the City of London, where it will be easier to commit fraud. And, of course, if we weaken our rules, then the City of London will weaken its rules, and then that'll be the excuse for us to weaken our rules further.

 

I wonder if it had anything to do with SOX being a craptastic law?

 

This is what I love about lawyers. When faced with any kind of breakdown, the knee jerk reaction is to outlaw bad behavior, because you know, people intent on committing fraud will be afraid of the law.

 

There were some good things that came out of SOX, such as increased public disclosures and adding personal accountability to financial statements. Yet if anyone thinks that creating new functions and teams inside companies for the sole purpose of "check the box" compliance is going to eliminate fraud belongs in the Washington circle and nowhere near running a real firm.

[Rob's House]

1/10 of our GDP goes to regulatory compliance.

 

And that's not counting the indirect costs.

[Gene Frenkle]

IMO, SOX SUX

[/dev/null]

IMO, SOX SUX

WTF OMG Pwnd FTW

[GG]

I think this piece exemplifies the point - legislators think their job is well done once laws & regulations are passed, not what happens in the aftermath. Because then, it's not their problem. There's nary a thought about keeping up laws with changes in market structures or technologies. It's never a problem until the next blow up.

Governments find it easy to implement regulations but tedious to maintain existing ones—politicians gain little political benefit from updating old laws, only from introducing new laws. And regulated entities tend to comply with the specifics of the regulations, not with the goal of the regulations themselves. All too often, once government takes over, what was private risk management becomes regulatory compliance.

 

 

 

 

[OCinBuffalo]

I think this piece exemplifies the point - legislators think their job is well done once laws & regulations are passed, not what happens in the aftermath. Because then, it's not their problem. There's nary a thought about keeping up laws with changes in market structures or technologies. It's never a problem until the next blow up.

That would require actually knowing WTF they are talking about, rather than simply receiving a point in time briefing, and basing all activity going forward on that point in time understanding. Typically most lawyers "don't want to bother with the details of business process"...they'd rather F about in the details of the law, which as a result, will have little basis in that business process, or, more likely, will be just fine for how it works today...but then will be rendered a least partially useless in a few months as things change.

 

In this, they are no different than Microsoft's approach to Word, or the assclown Ruby on Rails people's approach to websites. Rather than build something that is truly configurable, and therefore is capable of dealing with any convention, they demand that we all go along with their convention(approach), for no other reason than they supposedly know better.

 

And, when this approach is exposed because it's one size...does not in fact...fit all? What do they do? Bloat the hell out of it by adding a never ending cavalcade of features. Sooner or later, so many features exist that the software becomes confusing to everyone....and it takes an expert to come in and show you how to do the things you want to do. And even then, you have to go through 15 steps to get something done. But once you figure that out, a new release comes along that you have to accept, which changes those 15 steps, or moves them around, and now you are F'ed all over again.

 

Sound familiar(ahem, tax code? or maybe...the software you use at work?)

 

Now I could go on and blame all you Wall Street turds for propagating this assclownery in the .coms, by demanding that we all follow "The Microsoft Model" or you would downgrade our stock, causing a lot of them to fail as a result....but that's another thread. Let's just keep blaming the lawyers...because they are the root cause of this thinking anyway.

[KD in CA]

I think this piece exemplifies the point - legislators think their job is well done once laws & regulations are passed, not what happens in the aftermath. Because then, it's not their problem. There's nary a thought about keeping up laws with changes in market structures or technologies. It's never a problem until the next blow up.

 

 

Great piece, thanks for posting.