What Kind of Pitt is This? by Joseph Arrieta

What Kind of Pitt is This?
January 31, 2003
By Joseph Arrieta

Harvey Pitt, Chairman of the SEC, resigned on election night last year. He'd made a complete cluster of his appointment of William Webster to serve as head of the new oversight accounting board - turned out Webster was on an audit committee that was being investigated for fraud.

In a little dance so pathetic it's sad, Pitt announced amid the furor that he'd have the SEC investigate itself for this gem. "Oh, Pitt," Karl Rove and Andy Card must have said, firing him once the last polling station was closed.

"Rather than be a burden to you or the agency, I feel it is in everyone's best interest if I step aside now, to allow the agency to continue the important efforts we have started."

As I write this, Harvey Pitt is still on the job. What kind of Pitt is this?

Anyone else reading this would have been fired in a slightly different fashion. Payroll and network accounts are instantly shut down, some boxes dumped next to the chair and it's stated bluntly that one has 30 minutes to get the hell out. Often a security guard hangs around to make sure everything stays cool.

Harvey, on the other hand, has some special Republican pixie dust on his shoulders. He was fired approximately 85 days ago and the Pitthead is still collecting a paycheck, still contaminating SEC documents with his grubby corporate mitts. He completely screwed up his job, announced to world he was leaving and yet 85 days later is still there. Ain't that some Pitt?

2002 was a disaster for the securities markets. Widespread accounting fraud erupted across the news wires, every major indice lost significant value, and Congress passed a half-assed securities reform bill that had no options rules. The public and investing community took it all in and continued to dump shares in 2003. Apparently firing the head of the SEC but letting him keep his job isn’t the greatest prescription for investor confidence. No Pitt.

It should be abundantly clear with Pitt's continuing presence that the Bush administration thinks securities and accounting oversight is a game - a game of fraud, abuse, and felonies where the bad guys are fired but allowed to keep their jobs and their stolen money. The hapless investors and employees who inevitably suffer from this rigged charade? The Bush Administration doesn't give a Pitt.

Even though the Bush administration treats the investing public as childish powerless pawns they can manipulate at will, an extremely effective tactic is available for even the smallest investor: get out. 401k's are not exclusively set up for stocks - in just 15 minutes an entire 401k portfolio can be switched to bond funds.

It is indeed amazing the feeling the of peace and security that comes about from knowing all of one's retirement money is safe from the securities jackals.

There is a caveat to the tactic. Be sure to let the mutual funds manager and the NYSE know that trillions of dollars of lost wealth and one's retirement money is not something to play around with. That allegedly firing someone and having them still on the job 85 days later is just another way of being lied to. That although integrity, honesty, sincerity and wisdom have been tossed in the Pitter at the SEC they still make up a vital bedrock for a real citizen's existence.

The jackals can't steal any securities money if no one gives it to them to start with. The Bush administration and Wall Street lie and snicker at the investing public to this very day, but the instant they're aware a great many investors are not putting up with this Pitt things will start to change.

Joseph Arrieta is a writer and web producer living in San Jose, California.