Wyden Tries To Get Anti-ACTA/TPP Amendments Included In JOBS Act Vote
from the won't-happen dept
There’s a lot of talk about how the Senate is likely to approve the JOBS Act today with a procedural plan put in place by Harry Reid that limits the ability for any real amendments to be debated or discussed. Unfortunately, the JOBS Act has been more controversial than it should be, based on some misinformation being spread about how it’s somehow dismantling all investor protections from Sarbanes Oxley.
The fact is, this is a situation where the original rules clearly went too far in requiring onerous regulations on businesses that didn’t actually do much to stop fraud and abuse, but did make it prohibitively expensive for many good companies to go (or stay) public. There should be a middle ground that is not the “anyone can go public based on hype” days of the late 90s, and the much more limited public markets we have today. The JOBS Act may go a bit too far in raising the ceiling for the IPO “on ramp” to $1 billion in sales, but it’s not the free for all that some have made it out to be. It gives companies more time to meet full (expensive) Sarbanes Oxley compliance, but opponents make it out like in these five years, companies will just completely make up their financial documents (even knowing that they’ll face a reckoning when the on-ramp is over). Making the on-ramp slightly smaller probably would have made sense (and there was an attempt to do that, which appears to be dead in the water), but this is a case where you have a basic trade-off. Yes, you can add regulations to public companies, but it means you’ll have fewer public companies, and less money to spend on creating jobs. That’s a real trade-off, and one where those advocating specific plans do need to recognize the costs and the benefits.
Separately, there are many other features of the JOBS Act that make plenty of sense — such as allowing small businesses to make use of crowdfunding. Currently, crowdfunding is possible for pre-sales or donations, but not in exchange for equity. Yes, there is risk involved, but there are some limits here, and to some extent, people should learn to understand the basic risks of what they’re investing in before they do so anyway. These crowdfunded operations aren’t going to be giant companies dealing with Wall Street for the most part, so the talk of how this helps Wall Street is mostly bogus.
That said, because of the political process that will get this through quickly, it appears that Senator Wyden won’t get to introduce two amendments he proposed, one of which would have made it clear that the US can’t agree to ACTA without Congressional approval, and a second that would have required the USTR to make its proposals public on international trade agreements. Hopefully, we’ll see those proposals turn up elsewhere.
Filed Under: acta, jobs act, ron wyden, sarbanes-oxley, silicon valley, tpp
Comments on “Wyden Tries To Get Anti-ACTA/TPP Amendments Included In JOBS Act Vote”
if something sensible is trying to be done by a certain politician, of course it wont happen. the block put on by other politicians that just dont like what he wants to do in, for example, standing up for the people represented, being more important!
SOX is a complete joke
The Sarbanes Oxley act is completely and utterly useless. All it does is put in regulations to keep people from having access to systems they shouldn’t have access to. Well, I guess it does more than that, but the main effect is to keep people out of systems they shouldn’t be into. But that only affects the little guy. It wasn’t the little guy that cooked the books at Enron, World Com and Global Crossing, it was the CEO and CFO. All they need is a word processor and spreadsheet and they can do it again.
Re: SOX is a complete joke
SOX did not stop the banksters,
Glass?Steagall might have.
How much regulation is necessary in order to curtail wanton abuse? One could probably surmise that based upon the events spanning the past decade+, the present amount is somewhat lacking.
Re: Re: SOX is a complete joke
Even Mary Shapiro (SEC Chief) who only goes for the little fish is saying that the JOBS bill is going to cause a lot of fraud…
Re: Re: SOX is a complete joke
Free markets are often best for preventing abuse, in free markets competitors keep businesses honest, if a business is dishonest, I switch to a competitor.
In the market we have today, competitors are kept artificially low.
Often the ‘solution’ to people breaking a law is not to simply add new laws. That’s the problem with politicians, every time someone breaks a law, they think the solution is more laws.
Imagine if every time someone jay-walked or murdered someone or sped on a highway, a politician passed a new law to curtail further law breaking. That’s just silly. We don’t need new laws every single time someone breaks a law, we need to have law enforcement enforcing existing laws. They need to do investigative work and keep their eyes open, kinda like how police keep their eyes open for people who speed, for any telling signs of fraud, and they need to acknowledge that, just like murder will continue no matter how many laws are against it, fraud and lawbreaking will continue regardless of how many laws are against it. Often times punishing the behavior after the fact, for violating existing laws, is suffice, without the need to constantly pass new laws every single time laws are broken.
But, alas, political grandstanding is often more important than common sense and so we end up with a clutter of so many detrimental and expensive to follow laws, a new set of laws for every time someone broke the law.
As a result we have fewer people competing in markets and so ‘unethical’ (even if not necessarily illegal) behavior is easier to get away with because there are fewer competitors to switch to.
Re: Re: Re: SOX is a complete joke
“Free markets are often best for preventing abuse, in free markets competitors keep businesses honest, if a business is dishonest, I switch to a competitor.”
And in a perfect world there would be no need for antitrust regulations.
“every time someone breaks a law, they think the solution is more laws.”
Unless the perp is a campaign contributor, then regulations are removed for their benefit.
“we end up with a clutter of so many detrimental and expensive to follow laws,”
Glass?Steagall worked well for over half a century and I assume it was easy to follow. It simply got in the way of corrupt and greedy people.
“we have fewer people competing in markets”
not to mention the many stupid patent, copyright, trademark law suits
Can we just vote Sen. Wyden in for President already? He’s the only politician out there that seems to give a damn.
Never have I felt like I was reading a political blog at Techdirt until today.
It’s deregulation like this that helped cause the economic meltdown in the first place. I mean really, is it any surprise that no more then 10 years after repealing the laws put in place as a result of the great depression that we had an economic meltdown so bad that many called it ‘the great recession’?
I’d gladly take slower economic growth for less recessions, and less severe recessions.
I feel the same way. I don’t think Mike understands all of the regulations that are being stripped away from the Glass Steagall Act by the weakening of all of the regulations.
The stock market here is going to be very volatile because there are increased fraud risks involved. I’m pretty close to saying this is SOPA for the investment industry. Sure, the Sarbanes-Oxley Act went too far with bad regulations, but think about how much crony capitalism has been chipping away at deregulating in the two party system for the past 30 years. When the Dodd-Frank bill occurred, we had the crash of 2008. I expect that the JOBS bill will do more to eliminate jobs and cause even more calamity for everyone but the crooks in charge.
A joke right? Regulations put in place forcing banks to give loans to deadbeats is what led to the housing crisis, which kicked off this economic meltdown. Government imposed risk, all whisked away with taxpayer money…the fat cats and politicians all made out fine, whilst the rest of us are none the better or worse off.
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I would argue that you have to go back as far as the Community Reinvestment Act to understand all of the changes to the law that caused our economic meltdown.
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I’m really curious as to where this idea originated from, because it’s completely, demonstrably untrue, but there’s a ton of people out there who seem to believe it.
You want to understand the current financial crisis, look at the one that came before it: the Savings & Loan crisis of the late 1980s. The government ended up having to bail out the institutions involved to prevent a deeper, systemwide financial crisis. They called them “too big to fail.” (Yes, that term was not invented in 2008.) And the banks looked at that and realized something: if you’re too big to fail, you can get all the rewards of high-risk behavior without any actual high risk.
So they started pushing for more deregulation to allow them to do something incredibly stupid: knowingly write up loans to people with little to no chance of ever paying them back. (That used to be illegal, before they got the regulations changed.)
They get it both ways with subprime mortgages: because it’s “risky,” they can charge a higher interest rate and make more money off of it, but because they’re too big to fail, that “risk” doesn’t truly exist. When the whole house of cards finally collapsed, the government came to the rescue with our money, again, exactly as planned. The bankers were laughing all the way to the… well, you know.
No one ever passed any law forcing banks to make bad loans. If they did, then why are there so many banks out there (such as the one I bank with) that didn’t have any trouble in 2008 because they never made any bad loans? Had this supposed law forcing them to do so existed, that would not have been possible! The government wasn’t the one pushing this; it was the banks from beginning to end.
Re: Re: Re: Re:
No one ever passed any law forcing banks to make bad loans. If they did, then why are there so many banks out there (such as the one I bank with) that didn’t have any trouble in 2008 because they never made any bad loans?
The Community Reinvestment Act allows the banks to underwrite the loans, then give the loan to the government. Since Freddie and Fannie were Government Sponsored Entities, they were approved by Congress but acted like a private enterprise. In other words, they were the worst of a merge between government and private interests.
The problem comes from a number of laws that have chipped away at regulations that helped the market considerably. Sure, the bad loans was the government. But the problems started with the banks attacking Glass-Steagall and making those regulations weaker in the marketplace for stockholders and investors.
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There’s a huge difference between “allowed” and “forced”. The CRA allowed the banks to do so, and guess who was pushing to have it passed? The banks who ended up profiting the most from it!
Mere correlation, and not even a very consistent one. We’ve had plenty of economic meltdowns between the great depression and now. If you want to see the true cause, look less at the supposed “de-regulation” (Bush hired 90,000 net more regulators during his 8 years in office, and signed Sarbanes-Oxley in 2002), and more at our monetary policy.
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And go even further, to the Fed itself. Eliminate that, and you eliminate the up and down cycle entirely, because that cycle is an artificial construct. A steady-state economy is what we should have had, had the Fed not been allowed to manipulate things.
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I wouldn’t go so far as to say you eliminate the cycle completely, as the markets had issues prior to the Fed too, but the Fed certainly makes them much more frequent and much worse when they hit.
Hopefully, we’ll see those proposals turn up elsewhere.
And it would be nice if “elsewhere” meant in its own legislation instead of tacked onto a completely unrelated bill. I’m guessing that I’d agree with much of Wyden is proposing, but that doesn’t make this kind of thing OK. It’s a sign of how lawmaking is more about backroom deals and underhanded maneuvers than judging a proposal based its merits and on facts.
I was thinking the same. Isn’t it here that we at times read about bad-guy legislators egregiously trying to sneak bad legislation into unrelated legislation hoping that nobody will notice? But when friend-o-Techdirt Wyden (of whom I am a big fan) tries it, he gets a thumbs-up to try it elsewhere. Just saying.
That was my reaction as well; I’m surprised Mike didn’t mention it.
Just because the legislation is a good idea doesn’t mean Wyden should get away with sneaking it into a bill where it doesn’t belong.
Re: Re: Elsewhere
heh. from what i’ve seen of the process that’s the only way to actually get anything intelligent and useful through the system.
While I like the idea of both proposals that Senator Wyden wanted to put it, I don’t like the idea of putting them in a totally unrelated bill any more than I like the entertainment industry hiding additional IP restrictions in unrelated bills.
Re: Tag alongs
I guess I should have read all of the comments before I made mine. Hulser said the same thing better.
I think it incredibly bad that Wyden feels that it’s okay to run this sort of thing through on the back of another bill, as part of the horse trading to make the original bill pass. Basically, he is ignoring the will of the people, and instead is trying to push his monotone view through in the most sneaky way possible.
How you can celebrate the idea is beyond me.
The senate must approve treaties.
I sincerely hope that Senator Wyden manages to propose these ammendments in some other fashion, perhaps as their own separate bill. ACTA and TPP clearly have the qualities of a treaty and should require Senate approval.
I’m sorry you seem to have been protected in 2008 from losses.
NO MORE LOOPHOLES END OF STORY