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House Republican Overreach: Examining the Need for this Hearing

By Jon Golinger, Democracy Advocate

Despite floundering in a state of perpetual chaos and getting nothing done to help the American people, the Republican-run House of Representatives seems to always find time to do the bidding of big corporations and bash independent watchdogs just for doing their jobs.

So it was again this week when Congresswoman Ann Wagner of Missouri had her House Financial Services subcommittee spend half a day on a hearing she called “Securities Exchange Commission Overreach: Examining the Need for Reform.”  The exercise was little more than a platform for a line of corporate lobbyists to sit at the witness table and complain about public companies being required by the SEC to disclose material financial information to their potential and current investors about a company’s potential financial risks.  This is information that every smart investor would want to know before putting their life savings or retirement on the line – whether a company is engaging in activities that could put an investor’s hard-earned money at risk.

But instead of using all their C-SPAN time productively, in their anti-SEC hearing Rep. Wagner and her Republican colleagues made statement after statement bashing the securities regulator just for requiring companies to disclose material information to investors – i.e., for doing the job the law mandates the SEC to do.  To address these alleged sins, Wagner and her Republican colleagues proposed a dozen pieces of legislation aimed at reducing independent oversight of big corporations, eliminating corporate disclosures, and blocking effective investor protection actions.

We’ve seen this bad movie before.  Last summer, House Republicans held a series of hearings on this same theme, proposed similar legislation, and parroted near-identical talking points.  But all that complaining resulted in no action.  Perhaps it’s because their anti-disclosure, information-blocking proposals are overwhelmingly opposed by the American people.  A recent poll of 1,000 likely 2024 voters nationwide by Lake Research Partners found that voters strongly oppose – by 56% to 30%, a nearly 2-1 margin – Congress passing legislation to limit the type of information about a corporation’s business record that is disclosed to pension and retirement fund managers, investors, and the public.  The poll found that Americans across the political spectrum don’t want Congress to block companies from having to disclose information such as whether they use slave or forced labor oversees, have a record of product safety violations, including harm to consumers, injuries, or death, have gender discrimination or pay inequity problems, or how much a company spends paying expensive lobbyists.

The poll also found that some of the House Republicans’ specific SEC-bashing ideas are especially unpopular with Republicans.  For example, Congressman Bill Huizenga, Republican of Michigan, is sponsoring a bill to create a new SEC advisory committee made up of corporate executives and paid for by taxpayer dollars who would have the legal authority to influence government regulators’ decision-making on corporate activities.  The poll found that more than two-thirds of voters oppose the creation of this Corporate Executive Advisory Committee, with 73% of Republican voters opposed to it.  This is apparently a bill that regular people of both parties hate and only corporate lobbyists love.

Nearly a century ago, after the Black Monday stock market collapse plunged our nation into the Great Depression, President Franklin D. Roosevelt and Congress responded with a New Deal that created the SEC to be a new corporate watchdog to keep an eye on America’s financial markets and ensure American investors get the valuable information they need to make informed decisions.

Big Corporations, powerful financial firms, and sleazy securities traders hated the SEC from the day it was created – just as they hate it now.

But today, they have friends in high places in the House of Representatives – Republicans chomping at the bit to defang the SEC watchdog and stop the free flow of vital financial investment information to the American people.  No doubt they will keep trying.  We must stand up, call them out, and fight back.

Jon Golinger is the Democracy Advocate for Public Citizen