April 23, 2010--SEC-XXX

Republicans are trying to turn the porno scandal at the Securities and Exchange Commission into a case about not adding any new regulations to the SEC's toolkit.

If staff there had stopped searching Porno sites and had only been enforcing the regulations that already exist, there would not have been any financial crisis. In other words, no new regulations are needed.

A few points.

During the Bush administration, when all the surfing incidents occurred, staff at the SEC in effect were told to ignore existing regulations. Since Bush and his people were against regulating the financial industry, looking the other way while the shenanigans were underway was a strategy to get out of the way of the free market working its magic. The rest of that approach is history. (See New York Times article linked below.)

Thus, to focus on the porno is a juicy attempt to distract us from the essential issue--not what SEC staffers were doing when they were effectively told to just show up for work, but rather the mandate to look the other way. With nothing to do, including ignoring the evidence that Bernie Madoff was puling off the largest Ponzi scheme ever, SEC employees sat in their offices playing on-line solitaire and downloading X-rated material.

And of course, in this attempt to try to trick us into looking the other way, GOP leaders are intentionally ignoring the fact that the SEC, even it was on the case, did not, does not have the authority to keep an eye on derivatives trading, the heart and soul of what got us into the mess in the first place.