The U.S. House and Senate have recently passed versions of a so called “jobs” bill; both by large bi-partisan margins. It is cynically name the “JOBS Act” because it purports to help create jobs for Americans. But the acronym that makes up the bill’s title; Jumpstart Our Business Start-ups, is just a ruse to make it sound like the Congress is actually doing something to improve the chances of Americans to get a job. The truth is that the bill is in reality a bill whose purpose is to remove many key protections that investors now have when it comes to putting their hard earned money into new businesses.
The supporters of this bill claim that by making it easier for new businesses to raise money, it will enable these businesses to create jobs for Americans. The bill does in fact make it much easier for new businesses to get money from investors. However there is nothing in the bill that actually has to do with jobs creation. The job making part of the sales pitch for this bill is merely a matter of conjecture because new businesses usually do create some jobs. But there is not real guarantee that businesses benefiting from the real purpose of this bill will actually create jobs or where they will create them.
The real purpose of the bill is to eliminate many of the consumer/investor protections that were put in place in the aftermath of the Enron, Global Crossings and similar new business scams of the past decade. Some of the protections eliminated or changed by this new bill include; quadrupling the number of private investors that may be included in company ownership before a public offering of stock must be made; allowing “crowd-funding”, the direct solicitation and sale of potential investors instead of honest broker non-benefiting third parties handling sales; changes regarding independent outside auditing of business practices; creating a very high level of gross revenue (1 billion dollars) before certain rules and SEC oversight become mandatory. These and other changes or elimination of consumer protections make investment in new or start up businesses a much more risky proposition for the average non-professional investor. It creates the potential for gigantic financial losses by millions of Americans, with little protection from fraud and virtually no upside in terms of the supposed job creation.
The fact is that; most new businesses fail. Those in which the management volitionally takes out the lion’s share of the invested capital as salary and bonuses almost always fail. If you want to run a large scale scam in the investment arena, with millions of potential “pigeons” and billions in potential unethically acquired profits; this new JOBS Bill is made to order. And it appears that the old Wall Street Gang and Big Brokerage/Bank Mobs are up to their same old tricks. And they are doing it in the same old way; having their “friends” in Washington clear their path by enacting legislation which will legalize (in this case actually decriminalize) their activities. Several consumer advocacy groups, legitimate financial organizations and the SEC itself have voiced concerns about this JOBS Act. However in Washington, Congress and the White House have been pressing on with it.
And therein lies the central problem in the way business is done in Washington and on Wall Street; financial conglomerates economically support (bribe) the public officials in Washington who are responsible for regulating and protecting American citizens from financial predation by these conglomerates. In this case these economic predators are actually turning back the clock on consumer protection and having “their people in Washington” remove protections that we all know were designed to prevent marketing and investment fraud and theft. By changing the already established protective laws, Washington is redefining activities that were clearly scene as crimes against the American people as no longer being crimes; so that Americans can once again be more easily duped by the financial industry.
Despite the unprecedented ruinous economic financial debacles of the past decade, virtually all of which were enabled by purposeful government deregulation, Washington is shamelessly trying to recreate the circumstances that allowed all that to happen in the first place. The unconscionable and insatiable greed that is a known truth about the financial industry is still being enabled, advanced and protected by the elected official of this country in exchange for the investment world’s financial support of their campaigns and perhaps other financial rewards in the future.
It is the classic corruption of money buying influence and favors in order to make even more money; virtually all at the expense of 99% of the American citizenry. It is why the very rich get geometrically richer and the rest of us fall further behind. It is the continued growth of control of the U.S. government and all of our public business by private big moneyed interests. This increased influence of special private interests through the use of their vast economic resources was given a huge boost by the recent U.S. Supreme Court “Citizens United” decision which allowed unlimited amounts of private money to be spent to influence the picking and electing of public officials in our supposed democracy.
The whole process of how our government works and who it really works for is rapidly changing from of, for and by the America people to of, for and by private economic entities whose true make up may be unknown, but whose clear purpose is to take as much money from American citizens as they possibly can and as quickly as they can. We haven’t even recovered from the most recent and longest lasting downturn in our economy; and yet the same people responsible, both on Wall Street and in Washington, are at it again; setting up the next economic disaster to be perpetrated on the American economy and the American people.
Hopefully we, the people, will remember this latest trick the special interests and their people in Washington are attempting to play against us, when time to vote comes around later this year. We must not be fooled by false promises deceitfully disguised in phony names like this JOBS Bill. If those we send to Washington will not fulfill their oaths and stand up for and protect us; we must do so for ourselves. We need to make the effort to search out people to represent the best interest of us, the American people, who will truly and honestly do just that.