The Competitive Enterprise Institute is swiftly becoming the lead pipe-swinger in the defense of U.S. Capitalism. First they file an intent to sue NASA over their failure to comply with FOI Act demands for ClimateGate documents and now their suit to have Sarbanes-Oxley declared unconstitutional is three short days away from being heard before the Supreme Court.
I may have to check this one out as well.
SarBox, as many of you may know, is a terrible piece of legislation that has hustled through Congress in the wake of the Enron accounting scandal. Like most hastily crafted law, its unintended consequences include costing the economy at large billions of dollars each year in useless compliance costs [PDF].Think of it this way, since SarBox’s passage the law has cost the economy upwards of $400 Billion dollars in wasted compliance costs. Hmmm…where else have I heard that number recently?
I’m just sayin’…
The main issue, most simply stated, is that the agency set up by SarBox-the Public Company Accounting Oversight Board (PCAOB)-is unconstitutional because appointments to the Board are made not by the President but by the five members of the SEC. Like so many other unaccountable government agencies, among which include the National Labor Relations Board, PCAOB has grown by leaps and bounds since its creation and is literally like a rogue agent accumulating power without any Congressional or Executive oversight.
Remember, ObamaCare creates over 100 new agencies that will operate more or less exactly like the PCAOB and the NLRB. CEI notes the ominous words of Phil Gramm in 2002 regarding the enaction of SarBox. From their issue PDF at page 3:
This board is going to have massive power, unchecked power, by design. . .We are setting up a board with massive power that is going to make decisions that affect all accountants and everybody they work for, which directly or indirectly is every breathing person in the country. They are going to have massive unchecked powers.”
Substitute ‘doctors and everybody they work with’ for “accountants and everybody they work for” and you’ll get a real nice idea of what ObamaCare’s going to look like.
CEI sums up SarBox this way:
The law, which was rushed through Congress after the Enron and WorldCom scandals, created numerous corporate governance and accounting rules that have been criticized by both Democrats and Republicans as excessively burdensome to smaller companies, detrimental to U.S. competitiveness, and ill-equipped to protect shareholders from fraud. The decision the Court makes could be more consequential to jobs growth than any job summit politicians might have.
The reason for that, dear readers, is because, as the Club for Growth stated today in response to November’s job numbers:
The American entrepreneur remains the marvel of the economic world.
Left free to pursue his business absent useless and stifling Government yokes, that marvel is simply breathtaking.
Do the right thing SCOTUS.