By Mike Freeman

When is enough, enough? When it comes to American investors and corporations, the law has addressed what is "enough" more than a few times. In the mid 1990s, corporate America was riddled by specious law suits in which greedy opportunists would jump on the litigation bandwagon to suck money they didn't earn out of the corporate economy. As a result, various legislation was passed which limited the access of investors to class action suits against corporations. Well folks, the 90s are over. MC Hammer is bankrupt, Madonna is on her third (or is it fourth) comeback and the New Kids on the Block are in their mid thirties.

Enter a whole new corporate regulatory climate, fast on the heels of corporate scandal, document shredding, book cooking and bankruptcy. Gone is the era where corporations were protected from whimsical class actions. Now we've got Congressman Paul Sarbanes and his wonderful cure for our corporate ills. The effect of the recent corporate regulatory legislation is to declare open season on the American corporation. Soon every moron with a law degree will be filing suit against any corporation that closes at a loss from the previous trading day. Why? Because it's easy money, and that's what the American way has become. "How can I let someone else earn my money for me? What's the easiest way I can make a buck without ever getting up off of my own rear end?"

The seemingly innocuous Sarbanes Bill, which basically calls for tougher penalties for "crooked" accountants and white-collar criminals, was passed unanimously in the Senate yesterday. It was passed under the auspices of consumer protection and corporate accountability. Fine. Great. It's hard to argue against a bill that is created to promote corporate accountability and protection of the consumer. But do we really need a whole new government agency to accomplish those ends? Never mind the oversight and prosecutory powers vested in the hands of the already existing (and underfunded) SEC. Let's create a whole new government entity entirely devoted to checking everyone's books. You know, come to think of it, maybe an oversight agency for the accounting industry isn't so bad. Maybe we could find other applications for this generous trend towards industry oversight. I've long suspected that my dry cleaners doesn't actually use "light starch" like I ask them to. I'd sleep a lot better at night if the National Laundry and Textile Cleansing Oversight Board was ensuring the proper starch quotient of my collars.

Or maybe, just maybe, I should simply switch dry cleaners. The basis of the free market system has always been that the consumer will dictate how the business owners will conduct their business. If you short us on starch, we'll go across the street where Mr. Competitor, gleefully watching the exodus, will darn well make sure our shirts are rigid as a board and our pleats are sharp as a razor. Plus, he may even offer it at a lower price.

Many industry analysts believe, and I am inclined to agree, that consumers have the only possible leverage which can influence the disclosure and accounting practices of corporations, money. Is my confidence in corporate management shaken? You bet it is. That's why I will only invest in the companies which go above and beyond the others in laying out their accounting procedures in short, clear sentences, using words with no more than three syllables. I want colorful graphs. I want three-dimensional pie charts. I want dancing cartoon characters. I want someone I can call at 1:00am who will explain it all to me, or IÍm not giving them my money. What I don't want is the government using the frauds of upper echelon corporate directors as an excuse to legislate a corporate moral ethic. The successful company in today's market is no longer the one who can combine "digi," "hyper," "mega," "compu," "global," and "net," into dazzling new corporate monikers. The successful company is now going to be the one who can lure investors down from out of the trees with straightforward disclosure and coherent accounting principles, without government encouragement.

So, liberal lawmakers want to decide when enough is enough. When corporations realize that they have to compete, not only at the market, but also in their information disclosure to the investor, then it's been enough. When investors decide that they can trust corporate governance, it's been enough. When I've had enough, I'll decide who is going to get my money, and chances are, they're going to have to do a lot more than jump through a few regulatory hoops to get at it.

Don't be afraid, it's the free market system, and everything is going to be just fine.

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Mike Freeman is an Adjunct Scholar at Frontiers of Freedom, a non-profit, non-partisan public policy institute dedicated to protecting the constitutional rights of all Americans and restoring constitutional limits on the extent and power of government. You may email the author at mfreeman@ff.org