Robert Kuttner Excoriates Creators and Supporters of JOBS Act
Jon Perr explained how awful this so-called JOBS Act, or "Jumpstart Our Small Business Startups" is that was being pushed by Eric Cantor was last month. Well, now sadly it's passed the House and with wide bipartisan support and it's due for a vote in the Senate this Tuesday.
Eliot Spitzer, filling in for Keith Olbermann on Countdown spoke to The American Prospect's Robert Kuttner about the bill this Monday evening -- Robert Kuttner excoriates the creators and supporters of the JOBS Act, says it will strip investor protections :
Robert Kuttner, co-editor of The American Prospect and a senior fellow at Demos, and Eliot Spitzer, former governor of New York, discuss the nefarious intentions of the JOBS (Jumpstart Our Business Startups) Act. “The one thing we have going for us is, there are disclosure laws so that if investors have the wit to read the disclosures, they can protect themselves, and that’s what this wretched piece of legislation would gut. Shame on anybody who votes for this,” says Kuttner.
Thankfully as the Politico article linked above noted and as Kuttner pointed out, there is still some hope that this can get stalled or amended in the Senate since there are actually a number of Senators who have the sense to realize that this bill should not pass.
Here's more from Bloomberg News -- Small Biz Jobs Act Is a Bipartisan Bridge Too Far:
A spirit of bipartisanship is sweeping Capitol Hill, with lawmakers poised to approve a package of bills aimed at reducing regulatory burdens on small business.
We wish we could raise a glass. This moment has been too long in coming. But the legislation it has spawned would be dangerous for investors and could harm already fragile financial markets.
At issue is a measure called Jumpstart Our Business Startups, or JOBS Act, which lawmakers in both parties claim would relieve small businesses seeking to raise capital from burdensome regulations, and thereby create jobs. The U.S. House overwhelmingly passed the measure 390-23 last week, and the Senate is expected to consider it this week. The White House has said President Barack Obama will sign the legislation.
We agree that red tape can needlessly tie up small companies. We also agree that securities laws that bar startups from harnessing the power of the Internet to raise funds could use updating. And it makes sense to allow, as the bill does, an initial public offering on-ramp, which would give startups a chance to grow before saddling them with certain costly and time-consuming regulations.
But the JOBS Act goes too far. It would gut many of the investor protections established just a decade ago in the 2002 Sarbanes-Oxley law. A wave of accounting scandals -- think Enron and WorldCom -- had destroyed the nest eggs of millions of Americans and upended investor confidence in Wall Street. The relief would extend beyond small businesses and apply to more than 90 percent of companies that go public.
Lots more there so go read the rest. Here's more from Spitzer at Slate -- Kill the JOBS Act!:
The appalling bill that would repeal essential Wall Street reforms.
Once again, the Puppets on Capitol Hill are about to slam the Muppets on Main Street. The country still hasn’t recovered from the Wall Street-induced financial cataclysm of 2008, yet Congress is preparing to enact the Orwellian ”JOBS Act”—a bill that should in fact be called the “Return Fraud to Wall Street in One Easy Step Act.” The bill will undo some of the most important reforms placed on Wall Street in a generation.
Ten years ago, virtually all of the major investment banks on Wall Street were charged with a monumental deception of the American investing public: touting stocks as great investments when in truth the banks believed the stocks to be “dogs,” “pieces of ----,“ and worse. The banks did this because of the conflicts of interest woven into their business model. They were underwriting the very stocks they were also touting, making the investing public dupes helping the banks generate enormous fees.
At that time, the investment banks’ defenses were as astonishing as they were revealing. First, they claimed “everybody knew“ that analysts’ recommendations were worthless because of the enormous hidden conflicts—admitting that no rational, knowing person would rely on the advice investment banks were sending to tens of millions of small investors. This, of course, would have been news to the investing public. And then—even more disturbing—they rationalized that such deception was acceptable because they were not as bad as their competitors. In a world of relativism, “not being the worst” was in their minds a sufficient defense to market frauds. Read on...
Anyone who wants to let their Senators know what they think of this legislation can find their contact information here.