Last night, PBS's Frontline did a couple of hours on this. Terrific show, well-balanced, extremely informative. Traced Arthur Anderson problems back through the last decade, showed Connecticut Senators Dodd and LIEberman as part of the reason why Enron could lie, cheat, and steal so easily, pointed fingers at Tauzin of Lousiana too and at Bush's new SEC chairman, named Pitt, who came in from heading the accounting industry's lobby organization.
All in all, it's a huge mess, with questionable accounting practices sanctioned by congressional piggies unwilling to offend their big donors.
Frontline really got on LIEberman's case, showing his picture with voiceover "some of the senators who were the most shocked, shocked I tell you, were the very senators who made sure accounting regulations were swiss-cheesed with loopholes."
But Pitt is going to be very vulnerable to attack. As accounting industry spokesman until recently, he's accused of being "the fox who guards the henhouse." Plus, he looks like a jerk. Hope Bush can find a better SEC chairman before the foodfight begins.
In 1993, the Financial Accounting Standards Board (FASB) proposed closing an accounting loophole that allowed companies to avoid recording stock options on their balance sheets. According to a Merrill Lynch study, expensing stock options would have slashed profits among leading high-tech companies by 60 percent on average. Corporate America aligned with the accounting industry to fight the FASB proposal, with the result that in 1994, the Senate, led by Senator Joseph Lieberman (D-Conn.), passed a non-binding resolution condemning the proposal by a vote of 88-to-9.