A Lovefest for an SEC Nominee
The light and congenial mood was more appropriate to a Junior League bake sale than a nomination hearing for the man charged to run the world's most important financial regulatory agency. There were oohs and aahs over the comportment of Rep. Christopher Cox's lovely children, Charles, Katie, and Kevin; exclamations over Cox's magna cum laude degree from USC, and abundant compliments for his wife (and former White House staffer) Rebecca Gernhardt Cox. And this was from the Democrats!
Sure, the confirmation of the charming and intelligent Cox to replace outgoing SEC chairman Bill Donaldson had been something of a fait accompli, given the Republicans' majority status in the Senate and Cox's personal popularity. Yet the winks and laughter in the gallery made this hearing, which was also supposed to vet Democrats Roel Campos and Annette Nazareth for their seats on the commission, the inverse of a political show trial.
Instead of a genuine debate over the proper way to regulate our financial system, the hearing was a lovefest designed to anoint Cox—the spitting image of Supreme Court Justice nominee John Roberts Jr., down to the Boy Scout haircut—as a saint. It seems to be the way these things operate these days: Why talk policy when you can be part of either an embarrassing partisan smackdown or, worse, nothing at all?
In the senators' defense, it was already at least 90 degrees on that Tuesday, and they seemed to have had quite a few other things on their plates beyond how much Cox's chairmanship might swing the regulatory pendulum away from the reforms of the past few years. After all, there were five votes on the Senate floor that morning, and the Senate's August recess was just days away. Indeed, after only a few softball questions, the senators left for a two-hour voting break.
When those votes were over, only a couple of senators, including Paul Sarbanes (D-Md.), coauthor of the Sarbanes-Oxley Act, the most significant piece of financial regulation of the post-Enron era, even bothered to return. Sarbanes did ask a few pertinent questions, but even these were painted with a pretty semigloss. "You stated that we must bear in mind our obligation to raise ethical standards," Sarbanes said. "I was struck by that reference. . . How important a part do you see that if you were to be confirmed?"
"A big part, senator," Cox said. "No amount of regulation will stop all fraud. People that are intent on lying and cheating will still find ways . . . but there are a great deal of things that the government can do. Both are necessary, law and regulation, and the constant appeal to what is right and what is good so we don't have more Enrons." Now there's an illuminating answer. We need law, and we need good guys!
Cox, for his part, did a masterly job of saying absolutely nothing that could get him in trouble.
His kids were the picture of decorum. And he even laughed heartily when Senator Thomas Carper (D-Del.) spent his precious moments of questioning time asking whether Cox had been in a fraternity in college. "Yes," said Cox. "I think it was the same organization of which you, Senator, were a member."
"If your fraternity brothers were here," the senator responded, to knowing chuckles, "maybe we could get them to answer for the record what they would say [about Cox's nomination]. That's a question for another day." Indeed.