First, let's give credit where it's due:
By a vote of 37 to 32, the House Financial Services Committee moved to permanently exempt companies worth less than $75 million from the auditing provisions of the Sarbanes-Oxley Act, a change that was promoted by the White House chief of staff, Rahm Emanuel.
The amendment was criticized by senior Democrats, including Representative Barney Frank of Massachusetts, the chairman of the committee. But at a news conference on Tuesday, Mr. Frank defended Mr. Emanuel's involvement, saying he had helped to negotiate a substantial narrowing of the provision.
The companies that would be permanently relieved of auditing requirements under Sarbanes-Oxley have repeatedly won temporary exemptions from the Securities and Exchange Commission. The amendment approved by the committee was sponsored by two New Jersey congressmen, John Adler, a Democrat, and Scott Garrett, a Republican. Supporters said the more stringent auditing provisions were overly burdensome to small companies and that easing them would encourage job growth.
Before you decide the administration has become a band of born-again deregulators, here's the context of the exemption:
The bill, part of a broader effort to overhaul the regulatory system in response to the crisis in the financial markets, would provide new powers and increased resources to the Securities and Exchange Commission….It would also give the Federal Reserve a lead role in directly supervising many of the largest financial conglomerates.
For more from Reason on Sarbanes-Oxley, go here.