Man Without Qualities

Friday, July 26, 2002

Vuja De

With a corporate reform bill that the President has pledged to sign having swept through Congress with majorities that would make even the cheek of Joe Stalin perhaps blush a bit, it is time for a preliminary examination of what the federal lawmakers have accomplished and, in a related move, to ask if anything constructive might have been done. This exercise may help one to contend with the awful sense of Vuja De, or the feeling one will be here later, another concept for which the French don't have a word.

Senator Mike Enzi, a Wyoming Republican who is a former accountant, described the legislation as "earthshaking," telling The Associated Press it had been approved with "tremendous speed." The Senate approved the package, 99 to 0, only hours after the House had approved it, 423 to 3, just a day after House and Senate negotiators bridged their differences on the legislation.

To begin with, the reader must be disabused of errant suggestions that this legislation, which purports to profoundly restructure all of American business and accounting practices, was rushed, ill-thought-out or excessive. Reports that the bill is based on a computer dump of some Google searches performed by one of Senator Leahy's aides given instructions to throw in every cockamamie securities, accounting and corporate restriction that's popped into anyone's head in the last fifty years are considerably overdone. The Man Without Qualities has in fact received assurances form knowledgeable sources on Capitol Hill that great care was taken to eliminate duplicate "hits."

And before any provision was inserted into the bill, it was carefully reviewed by conscientious Congressional aides each of whom was required to be at least 18 years old. Results were impressive. In one case, a provision which had been advanced by Senator Leahy's office to address a perceived failure of the SEC "Plain English Initiative" (which sought to clarify Commission filings by requiring them to be written in "plain English" instead of legalese) was deleted after a sharp-eyed aide brought to the Senator's attention that the provision's text, which read

(i) From this day on, the official language of the Securities and Exchange Commission will be Swedish.
(ii) In addition to that, all executive officers will be required to change their underwear every half hour.
(iii) Underwear will be worn on the outside so we can check.

was actually cribbed from an old Woody Allen movie. After some initial effort by Senator Leahy to retain the provision, he relented when reminded that Allen had been disgraced as a result of his quasi-incestuous affair with Soon-Yi Previn.

Now, it is true that certain doomy-gloomy types, such as economists Kevin Hassett of the American Enterprise Institute and Robert Shapiro, formerly of the Democratic Leadership Council, have found that the bill will "likely impose significant new costs on American firms with little likely benefit" while opening up companies and their managers to more litigation from trial lawyers. But in considering such conclusions the reader should also bear in mind that media coverage is also bereft of any report that a single reputable economist in the nation has actually gone on record as asserting that the legislation will do more good than harm. So it is safe to say that the matter is open to debate.

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