Under a little-noticed provision of the recently passed financial-reform legislation, the Securities and Exchange Commission no longer has to comply with virtually all requests for information releases from the public, including those filed under the Freedom of Information Act.

The law, signed last week by President Obama, exempts the SEC from disclosing records or information derived from “surveillance, risk assessments, or other regulatory and oversight activities.” Given that the SEC is a regulatory body, the provision covers almost every action by the agency, lawyers say. Congress and federal agencies can request information, but the public cannot.

That argument comes despite the President saying that one of the cornerstones of the sweeping new legislation was more transparent financial markets. Indeed, in touting the new law, Obama specifically said it would “increase transparency in financial dealings.”

Apparently the children of the sixties, who once pushed for the Freedom of Information Act as a check to those in power, now are rolling it back once they are in power themselves.

“‘Our message to them is to work with this law, not against it; don’t try and take advantage of it or we will work with state authorities and gather the authority we have to stop rate gouging”

Quote #2

“They are not going to stop us in the plan, which is to give the people what is their right …

… (companies) try to convince (citizens) that big government does not work by twisting facts and taking advantage of honest mistakes. … We are bringing order to prices …

… there are traders who are taking these products to the black market … That is a crime and our government will continue to target these stores.”

The first is from the current White House. The second from the executive office in Caracas, Venezuela.

HT to Chris M. for both links.

Why?

Because after spending millions of dollars in R&D to develop this new product, it was able to increase sales from $0 to $100 million per year over a 20 year period. And when it first marketed the plastic wrap it sold it for $2.65 per pound and by the end of WWII it was selling for 45 cents per pound.

This is not an isolated case. The same thing happened when

• GE developed tungsten carbide (officers were each fined $5,000 for losing money and monopolizing this new product.
• the Morton Salt company gave quantity discounts to its large customers – and the Supreme Court found that to charge Morton did not require that their discrimination must have harmed competition, but only that there was a “reasonable possibility” that it “might” have had such an effect.
• Cement companies were forbidden from including the cost of freight in their prices (read that eBay merchants!)
• A&P grocery stores threatened to make its own Corn Flakes when its suppliers were not willing to give them bulk discounts.
• Topps baseball cards was sued because it signed exclusive contracts with major league baseball players’ photos on their cards
• Consolidated Food Corporation was sued for a reciprocity agreement with a farm supplier. In other words, they formed a deal where they said, “I’ll buy fruit from your farm if you purchase goods from my store,” (this is in fact what Wegmans does today – my guess is that they tiptoe around the “you buy stuff from me” part)

The moral of course is twofold. First is that antitrust has nothing at all to do with protecting consumers. And second, is that it is entirely plausible that virtually ANY decision made by businesses and entrepreneurs may arbitrarily and suddenly deemed illegal. This is the United States – not some “Banana Republic.” We’ve set up a system of Goldi-Locks regulation where prices deemed too high for the lords in DC will be evidence of monopolistic practice and firms forced to break up, where prices deemed too low for the lords in DC will be evidence of cutt-throat pricing and fines will be handed out, and when prices are similar at your firm than others – of course that is colluding with other firms to keep prices fixed – which is illegal, of course.

As RW Grant wrote in The Incredible Bread Machine (from which the previous examples are drawn):

When it comes to a mugger or a rapist or a murderer, the courts exercise commendable concern for the civil rights of the defendant. When it comes to the businessman charged with an antitrust violation, however, it is quite a different matter.

…

Antitrust is a bad idea gone wrong … based on the assumption that the businessman must serve the interests of “society” as determined by government … but in a free society the individual is not forced to serve others … that is the fate of slaves, not free people.

If they can consider the bill “deemed to have been passed” without passing the bill,

We should consider our income tax “deemed to be paid” without actually sending a check

Sadly, our income tax is already paid without sending the check. The thugs steal it from withholding each and every month.

Let’s think about the kind of tax system we have in the U.S.

What kind of effective marginal tax rates do you think a family faces that has per capita income below half of per capita GDP in the country or per capita income that is only 56% of the per capita personal income rates?

10%? No. Try again.

15%? No. Try again.

20%? No. Try again.

30%? No. Try again.

40%? No. Try again.

How about 42.38%? Bingo!

I was just awarded $10,000 more per year in salary for teaching additional classes and taking on additional responsibilities at school. I only get to keep $5,762 of it. Each semester is 14 weeks, so that is like me teaching classes for pay the first 8 weeks of the semester, and then working for free for the remaining 6 weeks. I love teaching, so I guess that is a measure of how much. But working for 43% of the time for free? Wasn’t that slavery? Who is doing the exploitation in the world? The employers that are paying me the $10,000, or the looters that are taking the $4,238 from me?

That 42.38% might be a slight overstatement – I try to get my witholdings right so that I don’t let Uncle Sam get any more of my money than he already intends to steal – so maybe the right number is 40% or so. Think about that, our family has a per capita income well below the average in America, and the next dollar of our income is taxed at 42.38%. That does not include the 8.25% in sales taxes that I’ll have to pay when I purchase something with it and that does not include the taxes I would have to pay on it if I invested it an saved it.

I might be less appalled if the taxes were used to fund anything that I approved of – but that is not the case. Even so, here is a little perspective for you. We have two kids, and we send them each to Catholic school. They are tiny, so they are only in pre-school. When they are of regular school age, their combined tuition will exceed $8,000 per year. The extra income I get from working extra hours here at U of R would have been enough to send each of them to school for a year. Of course, the taxes are enough to send one of my kids to school for a year.

Without the extra income, it would be a real stretch for our family to send our kids to the school of our choice. I still pay nearly $6,500 in property taxes to largely fund the schools that I do not wish to send my children to. These are excellent schools, no doubt – but I do not wish to send my children to school on the dimes of someone else, nor do I wish to have them further indoctrinated in the religion of the state by an unaccountable teachers’ union.  Is it any wonder Catholic schools are closing down faster than Obama’s job approval numbers?

So, there’s a little transparency for you. I’ll share my 2009 tax return with you in a few weeks.