I had thought that with the Democrats takeover of Congress, weâd be done with Congressional hearings convened so anti-regulatory groups like the US Chamber of Commerce would have a platform to present unscientific studies that purport to show the enormous damage done by federal regulatory policy. Sadly, I was wrong.
Last week, the Chamber released the results of a “survey” of the costs to small business of compliance with the Public Company Accounting Reform and Investor Protection Act of 2002, known widely as Sarbanes-Oxley or SOX. The Chamber tried to find small businesses that might be impacted by the law and asked 5,000 to complete a simple on-line survey asking questions that encouraged the answers the Chamber wanted. But only 177 (3.6%) of the 5,000 businesses surveyed bothered to respond.
Coming from the Chamber of Commerce, meaningless surveys are no surprise. Whatâs shocking is that the House Small Business Committee, chaired by Rep. Nydia Velazquez (D-NY), is holding a hearing on Wednesday, November 14th, to tout the survey’s results.
Hereâs a sample from the Committeeâs press release (issued November 8th, coincidentally the same day as the Chamberâs report):
For the first time, meaningful data is now available demonstrating that Sarbanes-Oxley section 404 will impose heavy costs on small firms. House Small Business Committee Chairwoman Nydia M. VelÃ¡zquez called for the survey to be performed after the Securities and Exchange Commission (SEC) repeatedly failed to provide a hard dollar estimate of the impacts on small businesses. In response to these new findings, the Committee will hold a hearing next Wednesdayâ¦..
âDespite concerns about the effects on small firms, the SEC claims that that new regulations will not be overly burdensome,â Chairwoman VelÃ¡zquez. âBut this new data proves that small businesses are indeed being impacted, and I call on the SEC to delay implementation of SOX 404(b) until the needs of small ventures are taken into account.â
The report is filled with impressive looking numbers and scientific sounding claims, like
The margin of error is Â± 3%., with a confidence level of 95%. The results can be considered to be statistically significant due to the response rate (3.6%) and number of viable cross tabulations.
But the only real finding of this study is that 96% of the businesses pre-selected to answer the survey couldnât be bothered.
I hope members of Congress will see through this charade and recognize that a faux-survey should not be the basis for any sort of policy-making, much less the rationale for eviscerating landmark bipartisan legislation, Sarbanes-Oxley.
The House Small Business Committee has just announced that the hearing where this study was to be presented has been postponed indefinitely.
Fear The Pump Handle!