And yet I think that is not quite right either. Cronyism is not quite yet a new political-economic system that has emerged out of capitalism. But I believe it is heading toward a new political-economic system. What that is, I shall be trying to determine.
The PEEKABOO Decision
The Supreme Court decision in the case of Free Enterprise Fund v. PCAOB turned
out to be damp squib. And yet, Professor Stephen Bainbridge points out, there was a passage--penned by the Chief Justice--that could become a sad memorial to the year 2010.
One can have a government that functions without being ruled by functionaries, and a government that benefits from expertise without being ruled by experts. Our Constitution was adopted to enable the people to govern themselves, through their elected leaders. The growth of the Executive Branch, which now wields vast power and touches almost every aspect of daily life, heightens the concern that it may slip from the Executive’s control, and thus from that of the people.
As for the possible economic impact of the Peekaboo case, Nathan Vardi suggests in Fobres more law means less entrepreneurialism: ( “Peekaboo: I See No IPOs")
SEC Loses an Insider Trading Case!
Kara Scannell writes in the Wall Street Journal
( “SEC Loss Shows Difficulty of Insider-Trading Cases
") that a U. S. District Judge, John Koeltl, has dismissed an SEC lawsuit against Jon-Paul Rorech of Duetsche Bank and Renato Negrim, a manager of the Millenium hedge fund. “Judge Koeltl rejected every point of the SEC's theory. He said the changes in the bond structure weren't material and that Mr. Rorech didn't possess inside information or violate any duty to Deutsche Bank to keep information confidential.” Scannell quotes Donald Langwood, a securities-law professor at Georgetown University’s law school as saying that the SEC has to "build a case where the communications really are nefarious rather than what goes on every day on Wall Street."