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S.E.C. Concedes Oversight Flaws Fueled Collapse

WASHINGTON -- The chairman of the Securities and Exchange Commission, a longtime proponent of deregulation, acknowledged on Friday that failures in a voluntary supervision program for Wall StreetÕs largest investment banks had contributed to the global financial crisis, and he abruptly shut the program down.

Also Friday, the S.E.C.Õs inspector general released a report strongly criticizing the agencyÕs performance in monitoring Bear Stearns before it collapsed in March. Christopher Cox, the commission chairman, said he agreed that the oversight program was Òfundamentally flawed from the beginning.Ó

ÒThe last six months have made it abundantly clear that voluntary regulation does not work,Ó he said in a statement.

You have to hand it to these guys; they've got chutzpah.

The last 80 years made it abundantly clear that voluntary regulation does not work, but we're willing to bet that six months ago this guy was singing its praises -- probably while laughing himself silly into a glass of Chateauneuf du pape, sitting across the table from someone from Bear Stearns.