GOP controlled Congress created Enron Accounting Fraud

[ThoughtCriminal]

A history lesson is in order to deal with today's inevitable right-wing talking point (It happened under Clinton).

In 1995 Republican controlled Congress passed the Private Securities Litigation Reform Act (PSLRA) which made it much harder to sue companies for misleading their investors. Also in 1995 the House and Senate froze the budget of the SEC, even though the agency lacked the staff to adequately monitor corporate balance sheets. The PSLRA was originally developed as part of "Newt Gingrich's Contract With America". One of it's chief lobbyists was Harvey Pitt - Bush's pick to head the SEC.

President Clinton vetoed the PSLRA, but the GOP controlled Congress voted to override the veto. Although a number of Democrats voted for the override, every Republican in the House and all but four in the Senate voted for it.

IN WAKE OF ENRON, CONSUMER GROUPS URGE CONGRESS TO RESTORE INVESTOR CONFIDENCE
BY UPDATING 1995 PRIVATE SECURITIES LITIGATION LAW:
http://www.consumersunion.org/finance/securdc202.htm

<snip>
"This law weakened the threat of liability for securities fraud to the point that it may have contributed to the lack of oversight of Enron," said Sally Greenberg, Consumers Union's senior product safety counsel.

When Congress approved the PSLRA in 1995, President Clinton vetoed it, but lawmakers voted to override the veto. At the time consumer groups said that the law would make it much harder for individuals and pension funds to recover their financial losses from fraud

"Congress was warned that this law would help protect financial swindlers from being held accountable," said Travis Plunkett, legislative director of Consumer Federation of America. "It diminished the legal threat that helped keep auditors honest
<snip>

[Demeter]

1. Don't Confuse The Freepers With Facts

Their belief systems can't handle it.

[redqueen]

2. Great post! The reality-resistant will not bother trying to comprehend

but still, it's good to try, just in case.

:hi:

[Ilsa]

3. Kick and Nominate and Emailed out to Waazooo...

:kick:

I remember Clinton's veto getting over-ridden, and one of my business-savvy friends saying it was another nail in the coffin of consumer and worker rights. I didn't quite understand the ramifications. He also had the media thing figured out a couple of decades ago when they "went corporate" on us.

(Edited because I am a really bad typist but good speller.)

[Jacobin]

4. When Congress approved the PSLRA in 1995, President Clinton vetoed it

When Congress approved the PSLRA in 1995, President Clinton vetoed it

When Congress approved the PSLRA in 1995, President Clinton vetoed it

When Congress approved the PSLRA in 1995, President Clinton vetoed it

When Congress approved the PSLRA in 1995, President Clinton vetoed it

That needed to be repeated, so I did.

republican congress passed the bill that enabled Enron situations OVER CLINTON'S VETO.

/there, I said it again

[Telly Savalas]

5. While the PSLRA is crap legislation

it's a stretch to pin Enron's behaivor on it.

If the threat of prison time wasn't sufficient to hold Lay and Skilling accountable (pun intended), why would the threat of a lawsuit do so?

[ThoughtCriminal]

6. PSLRA protected the accounting fraud

It is not a stretch at all. This was the enabling legislation that lead to Enron's accounting firm, Arthur Anderson to cook the books.