6-16-05, 11:46 am
President Bush nominated Rep. Chris Cox (R-CA) for the top job at the US Securities and Exchange Commission (SEC). As a member of Congress, Cox has a long record of undermining protections for working families, retirees and their pension funds at nearly every opportunity. The labor movement and retirees’ groups are urging an investigation by the Senate of Cox’s record, especially around several key areas related to the work Cox would do as SEC chair.
In 1995, Cox led a fight for an extremist version of the Private Securities Litigation Reform Act that would have made it impossible for defrauded investors to get any money back. Cox’s bill would have made the 'I knew nothing' defenses asserted by Enron’s Ken Lay and WorldCom’s Bernie Ebbers the law of the land. Cox’s effort failed, but shows how far outside the mainstream his ideas about deregulation are.
Labor says, if Cox had his way, corporate executives could recklessly defraud investors—and investors could not sue.
Cox thinks that the Enron debacle didn’t require new thinking about how to ensure that corporations don’t rip off workers and investors. After the collapse of Enron, Cox 'rejected the notion that Enron’s meltdown should cause Congress to rethink deregulation,' according to the Los Angeles Times.
During his 16-year career, Cox received more than $865,000 in contributions from securities, accounting, insurance and commercial banking firms. In fact, he has raised more money from financial services firms than from any other industry group.
Asking Cox to oversee the financial industry is like asking Halliburton to write the regulations that oversee the oil industry.
Oh wait... Bush and the Republicans did that, didn’t they?
The SEC was created in 1934 after the stock market crash to protect the economy from the irresponsibility that seem to plague large corporations and large stock market investors periodically. The chair of the SEC has enormous power to enforce securities laws, set regulations, hold corporate criminals accountable and—most importantly—preserve workers’ retirement security.
The Senate needs to examine whether or not Cox is really committed to these important values.
Large companies, the financial sector, the White House, and the Republican leadership are all lobbying the Senate hard to ensure that their close friend and colleague takes the SEC chair.
The enormous corporate scandals at Enron, WorldCom and HealthSouth, among others and the dramatic economic fallout as well as the problems they created for retirement savings and pensions for working people show that a vigilant head of the SEC is needed.
The new chair of the SEC is going to have to be tough on trading abuses in the mutual fund industry, conflicts of interest involving Wall Street research, questionable insurance dealings and more. With his close ties to big business and the finance industry and his ideological opposition to real regulation and reform, Cox just doesn’t have what it takes to do the job as needed.
It is likely that the SEC under his tenure will simply hold hands with big business while it continues to plunder pensions, savings, mutual funds, and other investments that hard working people make to plan for their futures.
But then again, did we really expect something different from Bush and the Republicans?
--Contact Leo Walsh at pa-letters@politicalaffairs.net. Go to AFL-CIO to find out how to send your message about Cox to your Senators.
