Deforming Corporate Reforms

Some days I don't know whether to read the morning newspaper ... or just whap myself upside the head with it.

Take the recent news announcement, for example, that Bush & Company had only been kidding when they said that, By God, they were going to crack down on all these corporate cheaters and finagling accountants. They held press conferences promising they'd prevent any more Enrons and Arthur Andersons. Now, however, we learn that the Bushites' reform promises were nothing but a cynical political ploy to buy time until the corporate scandals were driven off the front pages, so they could then let the miscreants return to business as usual.

Of course, the news stories didn't come right out and admit all this. Instead, the stories focused on the selection of the chairman of the new Public Company Accounting Oversight Board. The creation of this board was the chief reform passed by Congress to stop the crookedness of the big accounting firms. Bush, who received more campaign cash from these firms than any candidate in history, had initially opposed the creation of the board, but he relented when public outrage forced him to sign the bill.

Once it was created, however, George W. moved quickly to stop the appointment of real watchdogs to the board. Instead, at the behest of lobbyists for the accounting giants, this five-member public watchdog agency has been filled by, (one) a lawyer who represents coporate executives charged with insider trading, (two) a former accountant for Arthur Anderson, (three) a lobbyist for the big insurance companies, and (four) a former head of the CIA who is an amicable regular on Washington's cocktail circuit, but knows nothing about accounting.

Once again, we have the Washington insiders -- corporate and political -- scratching each other's backs, pretending to push reform, but quietly making sure that nothing really changes. Then they wonder why we Americans are cynical about them.

"Divided SEC Picks Watchdog For Accounting", New York Times, 10/26/02. "Ex F.B.I Chief Seen as Choice for Accounting Post", New York Times, 10/25/02. "Washington's Mr. Fix-It As Overseer Of Accounting", New York Times, 10/25/02. "Judge Webster, Miscast", New York Times, 10/26/02.

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