Sarbanes Oxley and All Similar Legislation Should Be Repealed

Thank you, DarrowDobaksa, for taking up this debate. I do, however, disagree with your disagreement on several of my points. :) >It merely says, if you're going to do business in this country, you're going to do it honestly and fairly... or else. Why must those statements be honest by law? Is it because they are economically potent? Then pretty much every advertisement would be banned. Yes, there is "truth in advertising" legislation, but if one were to take this principle to the logical conclusion, then advertisements that imply that their ultimately inconsequential products will make you happy should also be illegal. >I'd venture to say that a large portion of the population works for Corporate America in some capacity or another - a number in the tens of millions This statement assumes a homogeneity between corporations that doesn't necessarily exist. Some companies fail because of corporate malfeasance, but not all of them. In fact, the vast majority of them don't. And when one corporation fails, its productivity in society doesn't evaporate forever. Its factories don't burn down, and its employees don't commit mass suicide. Other corporations absorb what one corporation loses. Capitalism is exceedingly efficient on this point with or without the government. >On top of the financial effects of losing one's job or investments, the feeling that one can't trust one's employer or business partner to act with integrity and fairness stifles growth, prosperity and career aspirations within the workforce. I do not think it is the business of the government to manipulate what people feel about their career aspirations simply because it is not the business of the government to manipulate what people feel, period. To say otherwise is paternalistic and naive at best, totalitarian at worst. >However, the current economic climate, which is predicted to last for a substantial period, should tell you that corporate instability can have long-ranging effects both in terms of time and scope. This current economic crisis is occurring for reasons that have nothing to do with embezzlement and everything to do with inflated government credit. >Your second claims posits that investors can police their own investments. I agree. However, they can only do so to a certain extent. The natural structure of a corporation involves a dissemination of certain information that goes from top to bottom. Information that the average investor has limited to no involvement in gathering, analyzing, compiling, or presenting. I agree that there are limits to the ability of investors to collect specific information. However, it is sufficient that investors detect "red flags", as your citing of my Bernie Madoff example shows. When you're on the edge of an inner city neighborhood, you don't need to know the names of the gangs patrolling the area or the exact number of drug-related murders to know that you should avoid the area. All you need to do is look at the not-so-hidden dereliction of the area. The same is true of bad investments. >SOX does not protect investments as you state. In sum, it provides for auditor regulation, executive accountability, independent oversight, timely and accurate dissemination of information and stricter penalties. Whose interests do these concerns serve if not those of shareholders? Who would care about any of this besides the shareholders? >I agree that corporations should stand or fall on the strength its ideas and leaders, and if someone isn't smart enough to get his money out when the ship is sinking, then tough on him. However, I do have a problem with liars and crooks. There are many ways for smart shareholders to protect themselves from liars and crooks. They can run the companies themselves, they can gather enough competent, trustworthy contacts to fill those positions, etc. Why should the government have a hand in this? Assuming it should, what are the limits of their involvement? Ultimately, the private sector should be exactly that, private. When you own a company, that company is yours. At the same time, a corporation is not nearly as concrete or vital to the owner's survival as, say, a house. You live in your house; your house is necessary for your warmth and protection, and so the police help protect it. The same is not true of a corporation.