1. Explanation of Broadening Candidate Field: It is logistically impossible to get the best possible officials into office unless the best people available are running as candidates. Historically, the pool of potential candidates has been extremely limited, because the barriers to running for office are extremely high. Examples of barriers are the following:

1. Preparing a campaign requires immense time and effort: Potential candidates might need to take a year or more off from their careers just to run for office. Very few citizens have the luxury of taking this amount of time from their careers for a variety of reasons (for example, supporting their families and maintaining a career path in the event they are not elected).
2. Running requires significant funds and connections: Candidates typically need personal funds and/or connections to receive donations for advertising in order to have any hope of being elected. The funding/connections requirement excludes the vast majority of potential candidates, because most Americans lack the funds or connections to have any chance of winning regardless of how qualified they are for office.
3. The low chance of winning makes it difficult for anyone to take the leap to run: The odds of winning against multiple candidates are low to start with, and considerably lower if a candidate is not well funded. Additionally, there is typically no fallback position if they lose, so they have no way to recoup the time and money invested in running.

Currently, only a very small percentage of the population can consider running for office, and therefore the candidate base is extremely limited by definition. Law-CAMP removes all of the above barriers. Potential candidates will still be required to gather a following and collect signatures to qualify for candidacy (necessary to prevent a flood of non-serious candidates); however, once they become qualified candidates, no subsequent funding is required or even allowed. Qualified candidates can spend 100% of their time focusing on their messaging, because the distractions of fundraising and most aspects of campaign mechanics are removed. Law-CAMP makes it possible for persons of an average income level to run for office, and it ensures there is a fair and equal environment for all candidates independent of wealth or political connections.

2. Significantly Improved Focus on Legislation and Duties: The elimination of fundraising by elected federal officials will also allow them to focus much more effectively on legislation.  Currently, fundraising requires considerable time in planning, strategy, and events.  Several examples from WBEZ Radio Transcript: Take the Money and Run for Office provide clear insight into the direct impact of time and distraction that is directly attributable to fundraising.  For example, Nancy Pelosi participated in more than 400 fundraising events – more than one per day – in 40 cities during 2011. Walt Minnick, elected to the House as a democrat for Idaho in 2008, took only five days off from fundraising upon winning the election and began immediately fundraising for the next election two years in the future.  Walt indicated that $10,000 to $15,000 in donations were required per day to be reelected and spent between two and three hours every day on fundraising activities.  Additionally, elected federal officials that are heads of committees typically have a much higher fundraising obligation to their party and are expected to raise funds not only for their own campaign but also for the party as a whole.  Law-CAMP’s removal of the fundraising obligation will result in much better legislation by removing considerable distraction from all officials.

3. Increasing Diversity in Congress: An informal Huffington Post informal blog (Huff: Informal Business Experience Review of Congress) indicates that very roughly 35% of House Representatives have business experience, and 30% are attorneys. In the Senate, roughly 25% have business experience and 45% are lawyers. The remainder in the House and Senate come from a wide variety of backgrounds, such as teaching, medicine, physics, etc. There is some experience diversity in Congress, but the percentage of lawyers is vastly disproportionate to their occurrence in the population. Roughly 37% of Congress members are attorneys while, according to the American Bar Association, about 0.36% of the (total) population are lawyers.  Staff attorneys address the legal details of laws, and therefore it isn’t strictly necessary to have a disproportionate percentage of lawyers in Congress. The duty of Congress is much more about defining high-level policy than it is about covering legal details, and therefore there is no overwhelming rationale for lawyers to make up a disproportionally high percentage. Law-CAMP enable a much broader array of candidates, and that additional diversity may bring the percentage of lawyers in Congress closer to their occurrence in the population (though this ultimately depends on voter decision).

4. Why Government Financed Elections Won’t Create Budget Issues: While funding elections may appear to be adding significant costs at a time when the federal debt levels are already out of control, the actual financial impact should not be significant for the following reasons:

1. Many aspects of the campaign environment will be self-funding, such as the selling of television rights for campaigns, debates, and speeches. Additionally, many elements of the campaign, such as online campaign documentation and online streaming of live events, will have minimal ongoing costs once the systems have been established. Although economies of scale will allow the government spend per campaign to be much lower than in traditional private campaigns, the uniform government campaign environment will result in much better communication and allow for better voter assessment of candidates. For example, the Candidate Profile Form will be a clear record of each candidate’s view on issues, and the government campaign environment will provide unprecedented information through technology and streaming. Allowing the candidates to react to current events via a consolidated Twitter-like feed will allow voters to get a much better view of how candidates would handle issues that are affecting them.
2. In the long run, any additional cost of funding elections will be far outweighed by cost savings that result from the elimination of influence and special-interest manipulation in policy making, tax rates, etc. (See PublicCampaign.org: How Corps Paid More for Lobbying than Taxes as an example.)

1. Donations and Funding: Donations, dinners, gifts, entertainment, and discussions of future opportunities have the potential to sway opinions, decisions, and actions. Although it is often difficult to prove intent to influence officials, elections, decisions, and policy through funding and other means, there are many instances where such intent is plainly stated (Example: Politico: Firefighters Reopen Cash Spigot) and others where the intent can likely be inferred (Example: PublicCampaign.org: How Corps Paid More for Lobbying than Taxes).

The current system of officials and candidates being highly dependent upon individuals and organizations for support creates significant potential for decisions to be affected by items apart from the merits of the decisions themselves. Regardless of how principled individuals are, it is simply human nature to have a desire to “repay” those that have supported them. Additionally, there is almost inescapably very real pressure to repay benefactors if candidates want to win an election – and the effects are long-lasting because officials must continue to repay while in office to maintain support when it is time for reelection. The only way to eliminate paid influence is to eliminate every form of it. Law-CAMP eliminates the need for campaign donations from any organization or individual, and Law-PL explicitly makes donations and influence of any type illegal.

The elimination of political leverage will result in much more effective legislation and a much more effective Congress. Because virtually every lawmaker must take into account a large number of special interests, legislation must be modified and made more complex to satisfy those interests. Under DOR, all lawmakers serve just one master – the public that elected them – and as a result they will make much better decisions and laws will be much more effectively written.

2. Indirect Influence by Threat of Action: Special interest funds are sometimes used to help a campaign, but they can also be used to damage an opponent’s campaign.   An example from WBEZ Radio Transcript: Take the Money and Run for Office shows how Ami Bera’s campaign for House of Representatives for California was damaged by $682,000 of Super-PAC funded attack ads late in the election. The average television viewer saw the commercial 16 times during the week the commercial ran and Ami’s poll margin dropped by approximately 8 points during that period.  The amount spent on the attack ads in one week was more than 30 percent of his opponent’s budget for the entire campaign, so this tactic dominated the media in the final weeks of the election.  Mr. Bera indicates that the attack ad content claiming his enthusiastic support of Obama healthcare was false, but the damage was done. Perhaps the larger takeaway from this example is the realization that special interests don’t always need to spend money to have impact – the mere prospect that a Super-PAC could derail any campaign through a similar effort can have significant influence on any official or candidate without a dime of special interest money being spent.

3. Comparison of Bribery and Political Leverage: Bribery and political leverage are similar offenses, but they differ significantly in scope. When bribery occurs, the impact is typically limited to situations surrounding the offender or the organization he or she represents. Political leverage, however, has a scope so much broader that it often impacts the entire country, and the effects can be felt for years or sometimes for generations. Despite the seriousness of special interest political leverage compared to bribery, bribery is illegal in all forms and yet political leverage is not only legal in many forms, it has been allowed to run wild. This situation occurred primarily because there has never been a way to eliminate influence in a legislative environment that is controlled by political leverage. The DOR Laws, enacted in parallel, eliminate all forms of political leverage. Upon DOR enactment, political leverage in any form will be as easily recognizable and punishable as bribery.

1. Examination of How the Legislative Process Currently Works: The Politico article (Reference: Politico: Payoffs to States to Pass Health Reform) provides insight into the deal making that occurs in Congress by examining the specific actions required to win the last few votes on health reform. The article is worth reading to gain practical insight on how legislation currently works. In essence, it outlines how several states held out their votes to get reductions in Medicaid payments. Because these individual states receive exemptions, it essentially means that all other states pick up the Medicaid costs of the holdout states. Although these actions seem morally reprehensible and grossly unfair to persons outside of the government, they are not portrayed as being unusual by government officials. In the article the Senate Majority Leader defends these actions by saying “that’s what legislation is all about; it’s compromise.” Looking at the circumstances objectively from outside of government, it’s difficult to find justification to call back-room dealings with individual legislators holding their vote for ransom a compromise. Compromise, in the general sense, would be an open objection by a state to get a better deal for all states – not a backroom deal to benefit several “dealing” states while forcing “non-dealing” states to pay more to fund the back-room deals. Officials that hold votes for ransom are the winners, while others must pick up the tab, so the system in place currently encourages and rewards bad behavior.

The fact that this is described as “what legislation is all about” is a clear indication that the system is broken. Even President Obama referred to these deals as “just the cost of doing business in Washington.” This, of course, is the current cost because that’s the way the system works, but the example makes it clear that the system needs to be fixed to allow legislation to be passed on its own merit without individual back-room deals. Although the Nebraska example in that article was eventually withdrawn in 2010, this snapshot of actions and the way they were defended at the time provides clear insight into serious issues with current voting practices.

2. Examination of How Legislation is Frequently Passed Without Review: In addition to voting influence and backroom deals, legislation is frequently passed without ever being read, reviewed, or debated. There are myriad examples of this as discussed in Senator Jim Demint’s video discussing voting issues in the Senate (WP: Senator Demint: 94% of Senate Bills Passed Unread With No Debate). Bills passing without review are not an aberration or even a minority. Of the 911 bills the Senate passed in the 110^th Congress, 855 were passed by unanimous consent without a vote, discussion, or amendment. DOR Law-LEG eliminates this issue by increasing standards for proposing bills and by confirming review by all officials prior to voting.

3. Clarification That the Problem is the Current System and Not Individuals: Although the reference examples about voter influence and unread legislation demonstrate actions DOR believes are reprehensible and fundamentally wrong for our country, DOR does not cast blame on the specific individuals involved. DOR recognizes that, currently, officials are simply doing what they need to do to pass legislation in a system that is effectively broken. DOR Law-LEG provides a comprehensive solution to a very broken legislative process. Law-LEG will allow officials to legislate much more effectively and ensures that officials that skirt the system can and will be held responsible.

4. Performance Metrics Example: A January 2011 GAO report (GAO Federal Job Training Report) determined that nine separate federal agencies spent $18b in 2009 to administer 47 separate job-training programs.  The report indicates that very little is known about the effectiveness of these programs because, although most of the programs track some outcome measures, only 5 of the 47 programs investigated whether the results were attributable to the program.  The article discusses the possibility of efficiencies gains by combining or eliminating programs, but currently such steps are difficult to determine because each program is relatively opaque without any objective measurement standards. 

Under Law-LEG (requiring metrics) and Law-DASH (monitoring of metrics), the effectiveness of all 47 programs could be evaluated at a glance because a uniform set of metrics that tracked placement effectiveness and fiscal efficiency would be used to track all federal job-training programs.  The addition of objective metrics would make all of these programs more effective because each program would have constant concrete feedback about where improvement is needed and there would be competitive pressure to perform given the availability of uniform metrics across all job-training programs.  For the GAO and the government itself, the addition transparency on program performance would make it easy to determine which programs should be continued, discontinued, or combined. Instead, the GAO has difficulty making recommendations, despite researching the programs, because of their opaque performance. Under Law-LEG, every new law, agency, or initiative formed will include accompanying performance metrics to be monitored throughout its lifespan and this will result in significantly improved performance over the life of the initiative and significantly reduced costs due to elimination of waste.  

Discussion of Influence Through Future Opportunities: Influence can take many forms. Donations are perhaps the most common form of influence, but offers of future employment and/or opportunities after office can be an extremely powerful form of influence – oftentimes much more powerful than donations because future employment/opportunity funds go directly to the official, whereas donations typically go towards his or her campaign. Future employment/opportunity offers result in immediate influence on officials even though payment is deferred until after they are out of office. The waiting period and complete transparency regarding post-office engagements from Law-EMP reduces the opportunity for political leverage through offers of future employment or compensation. 

1. Rationale for Compensation Increases: A recent survey indicates that 67% of likely voters believe Congress is overpaid and only 1% believe they are underpaid. Further, the current pay rate is at least 3.5 times the US average. Why then would DOR, an organization that requires public endorsement to work effectively, actually suggest raising pay rates rather than lowering them? While DOR strongly shares the passion and belief among many that the government as a whole is not even earning its current pay level, raising pay is a key part of solving the current issues by attracting the best possible candidates to office and eliminating the need for supplemental income while in office. Logic dictates that, if pay is too low, it will attract a poor set of candidates and officials, and they will be subject to financial temptations while in office. Conversely, paying too much could create the risk of attracting candidates that are only interested in profiting from office rather than those motivated to serve their constituents. The Law-COMP pay rates represent a compromise between being attractive (in comparison to current rates) and being excessive.

When setting compensation rates, it is important to consider the future and not the past. The compensation rates need to be set based upon how officials will perform under DOR rather than to penalize them for non-performance in the past (especially since much of their non-performance is beyond their control and due to issues with the system itself). The DOR Laws will solve the system issues that limit officials’ effectiveness, so the combination of having the best possible candidates and officials in office and an environment that is free from political leverage will eliminate the current dysfunction in the government.

2. Increasing Compensation will Improve the Candidate Base: While Law-CAMP levels the playing field for all candidates and makes it possible for average-income candidates to run, Law-COMP ensures that the best possible candidates can be attracted to office from higher income level private positions.  The combination of Law-COMP and Law-CAMP provides a immeasurably significant increase in the quality of the candidate pool.  Currenly, only a tiny percentage of the population could consider running for office because of the financial and logistical hurdles.  The DOR Laws make is possible for nearly any qualified citizen to run.  Having a much wider selection of candidates that are elected purely on their merits will result in much more effective officials in office.

3: Budget Impact: From a purely budgetary standpoint, the pay increases will be done in tandem with staff size reductions, elimination of government transportation, and other GAO recommendations.  These changes are likely to offset the cost of increased salaries.  Regardless of whether the result is a net increase or decrease in expenses, the overall impact to the total federal budget will be insignificant.  Much more significantly, the overall savings from better legislation in an organization with a $3.5 trillion budget renders any consideration of salary impact irrelevant.

4. Rates Take Place only after Successful Reelection Under DOR: It important to point out that the new increased rates only take effect after reelection, so existing officials only receive the increased pay if they are voted in again once DOR is enacted. While some of the proposed reduction of benefits, such as eliminating private government transport, result in significant cost savings, the larger goal of those reductions is to put the officials “in the trenches” with their electorate instead of being elitists insulated from the public.  The reductions are not intended to punish officials, but simply to remove barriers from their constituents.

5. Additional Rationale for Those Opposing Increased Pay: Many critics of congressional pay like to note that Congress initially was paid only a few dollars a day, and it was a part-time role. The world, and the legislation required today, is infinitely more complex than it was when the country was formed. A position in Congress is beyond a full-time job when done correctly, and it requires solid business and financial knowledge to be effective in today’s complex global economy. DOR will eliminate many of the current issues in the legislative process, but it is always critically important to have the best possible people in office to effectively legislate – especially since there are a myriad of problems, such as the federal debt, that linger from pre-DOR actions (or inaction).   

Although the current average compensation of roughly $180k for Congress is about 3.5 times the national average, that rate does not compare to compensation for civilian executive positions with comparable or lesser responsibilities. There is no reliable “apples-to-apples” way to compare federally elected position responsibilities to civilian executive responsibilities, but one way to look at it is to compare the total number of positions available in the U.S. There are very roughly at least 10,000 large company CEOs in the U.S., but there are only a total of 535 positions in Congress. In addition to large company CEOs, there are a huge number of smaller company CEOs and a huge number of other executive positions in private companies of all sizes. By any measure, the number of opportunities in the federal government is a tiny fraction of the executive opportunities in the private sector, so the odds of winning a congressional position are tiny fraction of the odds of achieving an executive position in the private sector.   

Beyond the number of opportunities, there is a huge difference in pay rates between Congress and executive positions. The average and median “total compensation” of large company CEOs, including equity considerations, is typically many multiples of the pay of Congress. As an example, the median pay for CEOs of S&P 500 companies is roughly $8m per year according to research by Steven Kaplan at the Chicago Booth School of Business. While it can be debated whether congressional and CEO pay should be directly comparable, it would be difficult to make a plausible argument that the difference in pay should be 45 to 1. Additionally, larger private companies have a large number of executives beyond the CEO whose pay also dwarfs that of Congress.   

6. Factoring in the Immense Risk and Personal Investment Required to: In addition to the vast discrepancy in number of opportunities and pay, it must also be considered that the path to elected office is infinitely more difficult than the path to executive positions in the private sector. Specifically, civilian employees work their way through the ranks to executive positions while being increasingly compensated along the way. In contrast, federally elected officials must often suspend their careers and invest significant time, money, and effort just to have a chance at the elected position. Additionally, there is a high risk after the investment of campaigning that they will not be elected, and typically there are no fallback opportunities if they are not voted in. The process of running for office is somewhat similar to aspiring to be a professional athlete – it requires years of preparation with a low probability of winning. The very high pay rates seen in professional sports are in part due to what it took for the athletes to get to that position. In politics, there is a similar risk and investment required, but the pay for those who succeed does not reflect what it took to get there. The need to suspend your career for an extended period of time to run for office explains, at least in part, why it is not uncommon to see elected federal officials with very little professional experience – those that don’t have a career but do have connections or money are among the few who can actually take the leap and make the investment to run. Currently, only a very tiny fraction of the population can realistically consider running for office, and many of the few that are able to consider it are not the best qualified from an experience standpoint. The combination of Law-CAMP and Law-COMP will make it possible for any qualified person to run regardless of income level.

7. Competitive Pay Improving “Experience Depth” of Candidate Field: Just as traditional campaign costs preclude lower-income candidates from running, uncompetitive pay also prevents higher-income executives from running for office. Just as grassroots candidates provide an important element in government, skilled executives that have in-the-trenches experience are also important. Currently, the pay rate reduction is too much for many executives to take a risk to run when the end result is a very large pay cut, if they manage to get elected at all. Even the increased pay rates will often be considerably less than many civilian executive positions, but certainly the increased rates will be attractive enough for those that are truly motivated to serve the public. In short, these laws transform the potential candidate pool from a tiny minority to virtually any qualified person that is committed to serving the public.  The DOR Laws result in much more effective officials in office because they ensure that elections to have a much broader array of quality candidates and they ensure that election results are based solely on the merits of the individual candidates.

1. Why the STOCK Act is not Effective: Although the STOCK Act was actually introduced back in 2004, it was largely ignored until there was public exposure of the issue in a 60 Minutes report (60 Minutes: Congress: Trading Stock on Inside Information) in November of 2011, followed by a mention of it in the State of the Union address in January 2012. Shortly after the public exposure of the issue, both the House and the Senate quickly scrambled to put the STOCK Act in place, and the resulting legislation was signed into law in April 2012. Although the STOCK Act appears on the surface to address the issues and has certainly quieted public concern, in reality it accomplishes little. It officially clarifies that federal officials cannot trade based upon inside information; however, it does nothing to stop or even reduce the flow of inside information to external parties (such as hedge funds that profit directly from the information).

2. Inside Information Continues to Flowing Freely to Hedge Funds: The core problem is that, currently, sharing insider information with hedge funds is legal and occurs on a regular basis (Reference: WSJ: Inside Capitol, Investor Access Yields Rich Tips). Members of Congress and staff that are direct participants in legislation meet with the investment community, on average several times per week, and give the hedge funds direct information about what is likely to happen with legislation before that information is available to the public. Hedge funds actively trade on that information. This is not an alleged activity; it is well documented and acknowledged by the participants.  Though certainly sharing of inside information with investment group falls into the category of what the public believes should be eliminated in an inside trading law, legislators did not even attempt to address this issue and it remains perfectly legal under the newly signed STOCK Act.

The referenced WSJ article above outlines one example where hedge funds were leaked information about the elimination of the government plan in health reform by the very same federal officials that held the key votes. Hedge funds bought large quantities of health care stocks based upon that information before the public learned that the government plan was eliminated, and the health stocks rose sharply once it was announced. So, while Sam Waksal and Martha Stewart served time in prison because Sam provided Martha with information about an FDA ruling, Congress and staff can frequently meet with hedge funds and divulge any inside information they want without any repercussions for either the officials or the funds. In the private world, both the provider (Sam) and receiver (Martha) of inside information go to prison. In the government, neither the provider (federal officials and staff) nor the receiver (hedge funds, former staffers) incurs any penalties. In contrast to penalties, the hedge funds benefit immensely by placing trades that are virtually guaranteed to be profitable while individual investors are disadvantaged because they trade blindly without access to the inside information. In addition to hedge funds profiting, it is virtually impossible to imagine that the providers of the inside information, our federal officials, are not rewarded in some indirect manner because hedge funds often make multi-million or billion dollar profits from the information provided.

3. Even the More Stringent Version of STOCK Act That was Dropped Ignored the Real Problem: If Congress had genuinely intended to eliminate trading on inside information, it would have taken steps to make sharing of inside information illegal. Instead, it only considered requiring participants of political intelligence to register in a manner similar to what is required for lobbyists.  However, even the minimal registration requirement was dropped from the law during the legislative process. In the same way that registering lobbyists does not prevent or even curtail lobbying, registering participants would do nothing to prevent the sharing of inside information. Those who are aware of and are able invest in the specific hedge funds that use inside information reap the financial benefits of what is essentially “insider trading by proxy”.

4: Other Types of Inside Information: In addition to investment firms, virtually any type of private entity, such as corporations or government contractors, can benefit tremendously from inside information.  Early notice of government policy or contract decisions allows individual companies to takes actions that yield a significant edge over competitors.  Law-INS provides a generalization of inside information protection beyond just the trading context to secure information disclosure with any type of private entity.

5. Eliminating Enforcement Conflict of Interest: Given that the SEC’s budget and ultimately its rulemaking is completely controlled by Congress, there is a significant conflict of interest that makes it difficult for the SEC to enforce rules or pursue insider-trading cases in Congress. Law-INS eliminates the SEC conflict of interest by appointing an independent organization for oversight of any inside information violations.

1. How Dashboards can Prevent Lingering Problems: The public dashboards will help drive resolution and prevention of serious problems. For example, a likely target of the dashboards would be to monitor the individual components that caused the financial crisis. That report would itemize the individual areas and sub-steps required to prevent recurrence. While it isn’t possible or prudent to monitor every detail, it is important to ensure that the major components of the failures are monitored.  For example, rating agencies’ failures were a very significant contributor to the financial crisis and yet relatively little has been done to address the issues. The identification of ratings agencies as a “red” area on the dashboard will help ensure some focus is applied to that area and maintain awareness that it is an area of concern.  The dashboards will not dictate that actions be taken, but even in areas where no action is taken in the near term, the “red” status provides a constant reminder that this remains an area of continued risk.

2. BP Oil Spill Example: Preventing recurrence of the BP Deepwater Horizon oil spill could likely be achieved from the clarity that Law-DASH dashboards provide in highlighting what did and did not work in the BP incident. There was much that was done correctly that should have prevented the disaster. OSHA successfully identified warning signs before the occurrence of the incident. Prior to Deepwater, BP had been fined 760 times for what OSHA described as “egregious, willful” violations. In contrast, BP’s competitors had only a handful of fines in total during the same time period. Specifically, Sunoco and Conoco-Phillips had eight each, Citgo had two, and Exxon had one. In addition to the individual fines for BP’s violations, BP had sanctions from a prior incident in 2005 that killed 15 and injured 180. This event was caused by violation of safety procedures required by the Clean Air Act, and an inspection of the site four years later indicated that BP still had not fixed the safety violation that caused it (Reference: ABC: BP's Dismal Safety Record).  The larger intent of OSHA is not simply to issue fines but to eliminate safety issues and prevent disasters. Although OSHA is to be commended for proactively detect the violations, it failed to connect the dots when BP had 95 times the violations of the worst of its competitors (Sunoco and Conoco-Phillips) and 40 times the number of total violations of all of its competitors combined (Sunoco, Conoco-Phillips, Citgo, and Exxon). Although OSHA deserves high marks for identifying the individual infractions, much more needs to be done to connect the dots to prevent future issues. Simply identifying the lapse on the public dashboard will help ensure that the root problem gets corrected.

Another sub-component of the Oil Spill is to monitor actions taken in response.  On the one-year anniversary of the spill, changes have been proposed in Congress to improve safety, but nothing has been passed. One reason nothing has passed is the objection to removing the existing $75m liability limit for oil companies – despite the fact that the actual cost of the BP spill is estimated to be $40b, some members of Congress believe that the liability limit should not exceed $75m. There are also discussions about increased inspections, but all of this seems to miss the point that there were ample warnings of the impending Deepwater disaster, but those warnings were not acted upon. It is critical to establish a means to act on obvious red flags in not only oil, but in any industry (Reference: ABC: One Year After BP Spill; Congress Yet to Pass Any Major Laws).

3. SEC Example: One important aspect of the financial crisis to monitor would be SEC enforcement. There have been major lapses in SEC enforcement (Reference: CBS: SEC Ponzi Failures). Even when violations are identified, the SEC has frequently failed to enforce them by issuing waivers for the fines levied.  Even repeat offenders are frequently excused from payment of SEC fines. The firms receiving waivers are among the largest banks that had a prominent role in the financial crisis, and nearly 350 waivers have been issued in the past decade (Reference: NYT: SEC Avoiding Sanctions for Banks). Exposure of these issues will help ensure that issues within the SEC are addressed and that sanctions are meaningful and enforced.  The SEC has recently taken some steps to improve enforcement, so those areas should be highlighted as “green” in the dashboards, but those positive steps don’t outweigh the existence of fine waivers, which are difficult to characterize as appropriate (especially given the minimal sanctions issued by the SEC so far in response to the financial crisis).

No additional notes for DOR-Law-SUPR