The Witchhunt in Washington
Traders Magazine, July 2002
Scandal always seeks out villains to blame. Frequently those scapegoats are the people and organizations charged with safeguarding against those selfsame scandals. In 1934, the SEC was created by Congress. The Securities Exchange Act of 1934, "empowers the SEC with broad authority over all aspects of the securities industry." It also, "empowers the SEC to require periodic reporting of information by companies with publicly traded securities." When the Congress created the so-called "alphabet soup" agencies, which included the FAA, NLRB and many others, its intent was to make the regulators of our economy as independent from the political process as possible. However, the President nominates commissioners, including the chairman. The Senate must confirm them before they take office. There are supposed to be five commissioners at the SEC, with no more than three from the same political party. However for the better part of a year there have been but three: two Republican and one Democrat.
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