18 comments

  • ericbarrett 8 days ago
    The eight congressmen:

    Tom Emmer (R-MN)

    Warren Davidson (R-OH)

    Byron Donalds (R-FL)

    Ted Budd (R-NC)

    Josh Gottheimer (D-NJ)

    Jake Auchincloss (D-MA)

    Ritchie Torres (D-NY)

    Darren Soto (D-FL)

    The signed letter: https://emmer.house.gov/_cache/files/0/c/0c7fc863-7916-4b19-...

    • scaredginger 8 days ago
      Why do they keep telling us bipartisanship is dead?
      • godzillabrennus 7 days ago
        80% is still agreed upon by the uniparty. It’s the fringes on either side that make it so the government can’t agree on the other 20%.
        • mushbino 7 days ago
          That's how they market it anyway
      • Xeoncross 8 days ago
        I think you'll find a lot of the things they tell us are wrong
      • funstuff007 7 days ago
        because both parties can agree that the B in BIPOC stands for billionaires.
      • smitty1e 8 days ago
        Because once Cthulhu devoured the Ds and Rs there was no "bi", only bones.
    • qup 7 days ago
      If one of the Ds or Rs was flipped, we could all condemn the most-guilty party with great conviction.
      • smt88 7 days ago
        I don't know anyone with basic knowledge of Congress who doesn't understand that lobbying heavily influences both parties, although not at all equally.
        • dotancohen 7 days ago
          Possibly, but what percentage of the population actually has the basic knowledge you presume?
          • smt88 7 days ago
            A large percentage. There's a reason Trump's “drain the swamp” slogan resonated with so many people.
    • constantcrying 7 days ago
      Very glad to see that in the US political divisions can still be overcome and there can be a bipartisan effort to allow criminals to hide from the scrutiny of the SEC.
    • mc32 8 days ago
      Their parties should kick them out and replace them with more principled people.
      • tartoran 8 days ago
        That would be ideal but in reality these party members raised money for the party so.. they’re in 0 trouble as far as their party is concerned. The system is a farting contest that enables this behavior. Solution would be to do away with the 2 party system and make parties more responsible with consequences as being completely voted out if corruption isn’t handled. Now both Reps and Dems are corrupted and they known we have no other choice
        • akudha 7 days ago
          Countries like India have multi party system. That doesn’t seem to have slowed corruption/bribery at all. How would it help in the U.S?

          In a way, corruption is the U.S is worse because it is legalized (campaign contributions). If there were 25 parties instead of 2, it would be a bit more work to find out who to bribe, but I guess it is still doable

        • s3r3nity 8 days ago
          undefined
          • oneplane 8 days ago
            If you have a government with a billion people in it, but none of them are allowed to do anything with investments or even hold/have 'extra' jobs while serving society, you reduce or remove the problem all the same.

            A teeny tiny government with 1 person in it can still mess with investments on a global scale all the same if they are allowed to do so. It 'fixes' nothing.

            The size and scope of a government is not what makes bad performers perform badly. It's bad people combined with bad policies. How bad is a different topic (there is no absolute 'badness', but there are definitely differences).

            • koolba 7 days ago
              > The size and scope of a government is not what makes bad performers perform badly. It's bad people combined with bad policies. How bad is a different topic (there is no absolute 'badness', but there are definitely differences).

              The larger the size and scope, the more opportunity there is for bad actors. More cracks to slip through. More tills to dip into.

              It’s not the factor that makes a person corrupt, but the bigger the government, the more room there is for more corrupt people.

              • polygamous_bat 7 days ago
                As you increase the number of samples, you reduce the variance. So a small government of, say, 1 person, can either be 100% corrupt or 100% pure, but a larger government would approach the population level of corruption in expectation. Why is a larger governance with each individual holding less power less desirable than fewer individuals holding more power?
              • kylebyproxy 7 days ago
                By the same token, bigger government allows more room for oversight and principled actors to dilute the effects of the unscrupulous ones.

                As others here have alluded to, our problem is quality, not quantity.

              • themitigating 7 days ago
                But you're ignoring other variable affected by the size of government.

                I also want to point out the various dictatorship that have bankrupted countries. Sadam Hussain, various kings and queens over time , etc

                So you can't prove that a smaller government would be less corrupt

          • belltaco 7 days ago
            >EDIT: lol heaven forbid you propose smaller government with legitimate facts on HN lest you get downvoted

            How would smaller government have helped the FTX situation rather than make things like that much more common and worse?

            >The fact that the greatest investor in the US is Nancy Pelosi, AND she actively prevented legislation limiting insider trading by US Congress Members, should tell you that the government is not going to just get better by hoping the right people are voted-in. You need to systemically cut off their power and give that power back to the people.

            Restricting Congress members from trading would be big government and more regulations, not small and fewer.

            • MikePlacid 7 days ago
              > How would smaller government have helped the FTX situation rather than make things like that much more common and worse?

              What FTX situation? I have not given a cent to FTX, my kids have not given a cent to FTX, nobody I personally know have lost anything with FTX. More regulation (which in this case I don’t need) will cost me money spent to enable and enforce it.

              Now, exactly what regulations we need to prevent companies from spending customers’ money on executive homes? All regulation you need to prevent this is on the books for some hundred years.

              • polygamous_bat 7 days ago
                > What FTX situation? I have not given a cent to FTX, my kids have not given a cent to FTX, nobody I personally know have lost anything with FTX. More regulation (which in this case I don’t need) will cost me money spent to enable and enforce it.

                "Empathy is the capacity to understand or feel what another person is experiencing from within their frame of reference, that is, the capacity to place oneself in another's position." [0]

                [0] https://en.wikipedia.org/wiki/Empathy

                • MikePlacid 7 days ago
                  A List of Investors Whose Money in FTX Is Gone After Biggest Ever Crypto Fraud https://gsiexchange.com/a-list-of-investors-whose-money-in-f...

                  Empathy is a two-way street. Could you please ask these biggest and “smartest” investors to have some empathy to me, so they would do their homework before allocating huge amounts of capital? Instead of asking for more of my hard-earned dollars to improve… exactly what?

                • leereeves 7 days ago
                  How much empathy should we have for gamblers in an unregulated casino known to be filled with criminals?

                  There are so many people in the world more deserving of empathy.

              • kelnos 7 days ago
                Regulations don't mean anything if there aren't enough resources to enforce them. You're not going to get those resources with smaller government.
                • MikePlacid 7 days ago
                  My “hard-earned engineering wisdom” says: if you can’t use the existing resources effectively, pooling more people in will make the situation worse, not better.

                  Look at the list of the biggest FTX losers (I’ve just submitted it to the thread). These people have enough resources to police themselves effectively. I would agree to add taxpayers’ (mine) money to the picture no sooner than I see people who are allocating huge amounts of money without any homework going to jail.

            • wombatpm 7 days ago
              I don’t want to restrict them. I want real time total transparency for then, their trusts, their LLCs, their children, spouses, siblings. I want to know what they buy and when, I want to know contracts they sign and deals they make.

              When we have leaders living under that kind of microscope, maybe I’ll start trusting them.

              • themitigating 7 days ago
                So what if they tell their friends what to buy and sell?
          • lanternfish 8 days ago
            Now, I understand that there are very valid logical supporting arguments for small government, but let me get this straight:

            In a situation where massive fraud was committed by a corporation because the government inaccurately blocked government oversight, your solution is to decrease the size of the government... presumably meaning the oversight never would have been attempted in the first place.

            Crypto is exactly where libertarian advantages should be manifesting - the advocacy of a small government is exactly _more_ situations like FTX.

            • SailingSperm 7 days ago
              >the advocacy of a small government is exactly _more_ situations like FTX. Arguably not true. The presence of large government and pervasive regulation may behave like the bike helmet paradox (Where cyclists feel they are able to take more risk while wearing a helmet, and motorists drive more carefully around helmet-less riders). Smaller gov in this case may lead to individuals feeling less like the government has vetted xyz investment opportunity and therefore may feel a need to do their own due diligence more thoroughly.
              • themitigating 7 days ago
                The amount of risk taking obviously has some increase in the number of cyclists that get into accidents. However the outcome of the accident is more important.

                So for each accident: how bad was in the injury, cost, permanent damage, and recovery time. Then compare that between both groups.

                For example it could be that although wearing a helmet increases the risk of an accident by 15% it decreases the risk of serious brain injury or long term damage by 60%. If that were the case then the helmet is beneficial.

              • polygamous_bat 7 days ago
                > Arguably not true. The presence of large government and pervasive regulation may behave like the bike helmet paradox (Where cyclists feel they are able to take more risk while wearing a helmet, and motorists drive more carefully around helmet-less riders).

                It's a paradox for a reason -- it is counterintuitive. Do you have studies or proof that "small government" may be helpful here, or is this a position that you hold from before that you are justifying here?

          • rqtwteye 8 days ago
            She is also the biggest fundraiser and therefore really important for the party.
          • themitigating 7 days ago
            "The fact that the greatest investor in the US is Nancy Pelosi"

            Is that a legitimate fact? I'm pretty sure Warren Buffet is better than her, maybe he's not the best but the point is you lied then got mad when downvoted

          • nathanaldensr 7 days ago
            You should expect to be kneejerk-destroyed from those who suffer from cognitive dissonance. It's what they do.
      • nradov 8 days ago
        Political parties have no legal authority to expel a member from Congress. Parties are voluntary private organizations with no formal role in any branch of government. The most the parties can really do to punish a politician is to withdraw financial and organizational support, which might make reelection difficult.
        • koolba 8 days ago
          Both the House and the Senate make their own rules, and that includes the ability to unseat a member. If they really wanted to, they could (but they won’t).
          • fshbbdssbbgdd 8 days ago
            Huh, I’m surprised one party who controlled the House or Senate never decided to just kick out all their opponents, if they are legally allowed to.
            • koolba 7 days ago
              It’s an escalating game of chicken. You can see it happening in the new Congress with public statements from the Republican incoming majority leader to remove certain Democrats from committee assignments (e.g. removing Schiff from the intelligence committee).

              Not that long ago that was unheard of and either party could seat whoever they’d like in a committee. But similar to how the Democrats killed the executive appointment filibuster, they killed that as well by refusing to seat Republicans on the Jan 6th and removing some from other committees .

              Now it’s going to come full circle. I wouldn’t be surprised if it eventually gets to unseating or refusing to seat a controversial figure.

              • nradov 7 days ago
                Congress can't refuse to seat a controversial figure. They can only unseat after the fact, and that requires a 2/3 vote.

                https://supreme.justia.com/cases/federal/us/395/486/

              • MichaelCollins 7 days ago
                Removing each other from committees is a far cry from kicking each other out of Congress. That has only happened twice since the 19th century, and both times it came after a criminal conviction. Merely being an absolute idiot isn't enough to get a 2/3rds vote to kick out a congressmen because that would be mutually assured destruction; they all know they're all absolute idiots so they don't expel each other out for that.

                Also,

                > Both the House and the Senate make their own rules,

                The rules for expelling congressmen are set in the US Constitution, they don't just make it up as they go. Unless you're talking about their ability to amend the US Constitution, but that's even less likely than kicking these guys out the normal way.

                The best way to get them kicked out would be to have them convicted for bribery/corruption, then you might get a 2/3rds vote to expel them.

            • coffeebeqn 8 days ago
              What would be the upside? They are already fairly powerless in the opposition and this would be a huge scandal
      • tsol 8 days ago
        The thing about democracy is, even if the people make a bad choice it's still democracy
        • sbuttgereit 8 days ago
          From "Teller Reveals His Secrets" (https://www.smithsonianmag.com/arts-culture/teller-reveals-h...)...

          "7. If you are given a choice, you believe you have acted freely.

          [...]

          When I cut the cards, I let you glimpse a few different faces. You conclude the deck contains 52 different cards (No. 1—Pattern recognition). You think you’ve made a choice, just as when you choose between two candidates preselected by entrenched political parties (No. 7—Choice is not freedom)."

          It may still be democracy, but the task of the people isn't to pick the best or most desirable policy/candidate/etc. It's to pick from the presented selections. If all choices are bad, nothing good will come of it no matter what you call it. Add an option for "None of the above/Do-over" and I'll have more faith in democracy.

          • kodah 7 days ago
            > Add an option for "None of the above/Do-over" and I'll have more faith in democracy.

            I would really love this and to end PACs.

          • themitigating 7 days ago
            Wouldn't misinformation also be a similar situation. If you make a choice based on misinformation or incomplete information, is that democracy.
        • rjzzleep 8 days ago
          "The thing about democracy is, even if the people abuse their power it's still okay" - well, not much different from a non-violent dictatorship then.
          • rayiner 8 days ago
            No, it’s exactly the opposite. A system that puts unelected prosecutors of “abuse of power” above elected officials would be a non-violent dictatorship.
          • dylan604 8 days ago
            There are plenty of people that are arguing for just that, and they already have the person to put in charge picked.
            • kelnos 7 days ago
              Maybe that's what they're arguing for, but the people they've picked absolutely would not be non-violent.
      • JumpCrisscross 7 days ago
        > parties should kick them out and replace them with more principled people

        Their parties could evict them. But they’d retain their seats. Their voters gave those to them.

        • justin66 7 days ago
          If their parties had something like a consensus, under the constitution congress could vote to expel them for ethics violations. Of course, congresspeople don't like to punish congresspeople for ethical lapses too vociferously or too frequently, for some obvious reasons...
      • themitigating 7 days ago
        If they punished them, especially in a way that would cause then not be funded in their next election, they could just switch parties.
        • HelloNurse 7 days ago
          Which would make the party that expels them look good, and the party that takes them and their funding on board look bad.
      • Consultant32452 8 days ago
        No matter who you vote for, the government wins every election.
        • themitigating 7 days ago
          What does this even mean? The government (the elected portion) isn't an entity outside of the people that are elected.
      • rodgerd 8 days ago
        Like... they guy running on whether he wants to be a warewolf or vampire? The lady worried about Jewish space lasers?

        Just getting people who are sufficiently in touch with reality that they're merely corrupt seems like a win at this point.

        • blamazon 7 days ago
          To be fair, that werewolf or vampire thing was the most cogent part of the campaign so far.
          • rodgerd 7 days ago
            I would like to disagree with you.

            I can't, but I'd like to.

      • joxel 8 days ago
        Au contrare, Ted budd just got promoted to senator.
      • MichaelCollins 7 days ago
        This comment makes no sense in the context of America. I guess you're from a country with some sort of Parliamentary system where governments are formed when a party is elected?

        In America, parties aren't elected and don't form governments. Accordingly, an American political party cannot kick out a congressman, much less replace one. To remove a congressman requires a two third vote (from congress, not from a political party); this never happens in the modern era without a criminal conviction as the impetus. And nether congress or a political party can simply bring in a new congressman; you'd need another election for that.

        • lostmsu 7 days ago
          It still can be done for the next term. AFAIK there is no limit on terms and people stay in congress far too long for my taste.
    • ekianjo 7 days ago
      Politicians right and left have no problem with taking a big check to further their own interests.
    • googlryas 8 days ago
      How much was donated to them versus other senators?
      • HarryHirsch 8 days ago
        A sufficient amount of money, clearly.
  • dylan604 8 days ago
    "The March letter from eight House members—four Democrats and four Republicans—questioned the SEC’s authority to make informal inquiries to crypto and blockchain companies, and intimated that the requests violated federal law."

    This wasn't an investigation into just FTX. This was a broader investigation into crypto companies, plural. The current post title of "Inquiry into FTX" seems to be editorializing. Dang must be slow on the tryptophan to not post the usual HN guidelines reprimand

    • alsetmusic 8 days ago
      It’s the title of the article which makes it appropriate here. That it’s a bad title, however, is not in dispute.
      • peyton 8 days ago
        I mean there’s zero mention of FTX in the letter. Perhaps a question mark is in order.
      • themitigating 7 days ago
        I wouldn't blame the poster but the source which is using an extremely manipulative headline.
  • spir 8 days ago
    There are politicians and media publications protecting Sam Bankman-Fried's criminality, but these congressmen aren't among them.

    The letter in this article was written in March. FTX's long-term fraud has only been known since early November.

    • Dylan16807 8 days ago
      You don't have to know about specific bad actions to shield the entity that is doing them.
      • JamesianP 7 days ago
        But if you fight against overzealous enforcement you will necessarily be shielding some bad actors along with the good.

        Not that I'm personally against the SEC (and other agencies) crossing into crypto and interpreting their mandate broadly, rather than being overly conservative and waiting for new laws while the scammers run wild. But in other areas these paperwork demands could be a huge burden...

      • themitigating 7 days ago
        True but it changes the amount of guilt right?

        Maybe they were just helping companies donating to then, the letter is about cryptocurrenty in general.

  • racked 8 days ago
    Yes, the crypto world is a hornet's nest, but the non-crypto world is ruled by bankers with an ever-increasing thirst for control over our lives. (Read up about the Fed's new CBDC plans)

    As far as I'm aware, Monero and cash are the only practical ways to pay anonymously.

    So, who are worse? The congressmen who (perhaps in this case naively) tried to avoid overregulating crypto, or the remaining congressmen who continue to condone an economy completely manipulable by private bankers by way of the Federal Reserve?

    • kelnos 7 days ago
      Intent matters. Even if these congresspeople are correct that the SEC shouldn't be doing what they're doing, if the reason the congresspeople wrote that letter is because they received "donations" from cryptocurrency companies or PACs, then I think we should still give it some scrutiny.
    • brian-armstrong 8 days ago
      Regulating a sketchy Ponzi scheme with vaguely crypto trappings != regulating crypto
    • throwaway1777 7 days ago
      They both suck and both should be criticized. But also both crypto and banks are diverse and not all bad.
  • Animats 7 days ago
    "Enforcement powers, while conceptually broader with respect to non-SEC regulated entities, are still circumscribed by statute, federal judicial review, congressional oversight and the Commission’s own policies and procedures for initiating and conducting inquiries and investigations."

    Now that's being squishy-soft on crime. That's the point to make when those members of Congress come up for re-election. They're soft on crime.

    The basic law the SEC enforces, the Securities Exchange Act of 1934, is pretty clear on what's a security. The Supreme Court has clarified that. Investment of money, expectation of profit, common enterprise - it's a security. That's called the Howey Test. It's also been established that what you call it or how it works doesn't matter. There have been, over the years, many imaginative schemes cooked up to get around this. The Howey case involved tradeable orange grove harvesting rights in Florida. That was held to be a security.

    The crypto crowd has been yammering for years "but this is different". Well, it's not.

    The scams around crypto are classic. It's usually insiders stealing the money. The crashes are also classic. It's someone being over-leveraged when something goes down. This is not financial innovation.

    • BuyMyBitcoins 7 days ago
      >”The crypto crowd has been yammering for years "but this is different". Well, it's not.”

      In what way? Some cryptocurrencies have been declared securities, while many have not. Those such as Bitcoin and Ethereum have been around for long enough that if they were going to be ruled as securities via Howey, that would have surely been done by now.

      • Animats 7 days ago
        That was done years ago. The SEC cracked down on initial coin offerings back in 2018. They're still working down the backlog.[1] The "cyber" enforcement staff was doubled a few months back to catch up.

        The SEC does not consider Bitcoin to be a security because there's no "common enterprise". It's distributed more like a mined commodity. Miners are competitors. But where there's an issuer, or "minting", or "pre-mining", or anything like that, you can buy it, and it's expected to go up, it's clearly a security.

        Etherium is in an interesting position with the shift to proof of stake. That may have made it a security, because it's now controlled by voting owners, just like a stock. So now there's a "common enterprise", unlike in the "mining" phase.

        The big question now is exchange regulation. Are Bitcoin exchanges and brokers going to have to register with the SEC, pay for and be covered by SIPC insurance, and be regulated by FINRA? After FTX, that's probably coming. FTX acted like a retail broker, after all. Nobody runs Super Bowl ads or buys stadium naming rights for something sold only to institutional clients.

        The law in this area looks at the economic realities, not the form. If it looks like a security, is marketed like a security, and is bought and sold for the same reasons as securities, it's a security. Doesn't matter what you call it.

        [1] https://www.sec.gov/spotlight/cybersecurity-enforcement-acti...

      • JumpCrisscross 7 days ago
        > that would have surely been done by now

        We are getting damn close to that being done through statute in the U.S.

  • MetaMonk 8 days ago
    "Blockchain Eight" when you coulda had "Chain Gang"? Cmon.
    • IfOnlyYouKnew 8 days ago
      It's a reference to the "Keating Five".
      • MetaMonk 7 days ago
        Didn't know about that scandal, but it's also just standard to uncreatively (but tersely) name important events etc. with a structure of <noun/adjective> <number> (Boston Six, Gang of Four).
  • skippyboxedhero 7 days ago
    The SEC tried to stop the SEC's inquiry into FTX.

    Gensler said earlier this year that the SEC should be regulating FTX. SBF unleashes his torrent of mid-term money and then Gensler was saying up until FTX went bust (he was reportedly lobbying for them a few weeks before) that it should be the CTFC's job (which was the position that FTX were lobbying for as they had also bought a few people at the CTFC).

  • AnimalMuppet 8 days ago
    In March. And not FTX specifically, but crypto in general.

    So, as d1str0 said, yes, very inflamatory (and misleading) headline.

    • encryptluks2 8 days ago
      The headline is still accurate, as stopping SEC inquiry in crypto would have the same effect.
      • AnimalMuppet 7 days ago
        Would an inquiry in March have prevented the FTX mess? Maybe. It would have been good to at least give it the chance.

        But in the current situation, the headline reads like these 8 tried to stop an inquiry specifically into FTX after the collapse, which is totally not what happened.

      • themitigating 7 days ago
        It's accurate but extremely manipulative because it implies this the congressman were directly helping FTX.
      • MichaelCollins 7 days ago
        Accurate maybe, but very imprecise.
  • neilv 8 days ago
    Let's not Friday (Holiday) News Dump this possible story.

    If there's something to it, next week people will have more time to look into it, without it spoiling their turkey appetite.

    • themitigating 7 days ago
      Not everyone celebrates Thanksgiving
      • hinkley 7 days ago
        If the topic is a US domestic matter, most of the people who need to pay attention do.

        This idea that having accurate information about things happening on the opposite side of the world is going to change anything? You don't have to think about it for more than two seconds to see that's not true. It's an Illusion of Control.

        Exposing something is only the first step do changing it. But you can expose things and not change a damn thing.

  • d1str0 8 days ago
    This is quite an inflammatory title by HN standards.
    • UberFly 7 days ago
      It's the same title as the article, but yea, click bait title all the same.
  • jmpman 8 days ago
    Just like the Keating Five. These politicians should be vilified.
  • ourmandave 8 days ago
    • dragonne 7 days ago
      FYI this site isn't paywalled, it just has an obnoxious popup.
  • yalogin 7 days ago
    When it comes to doing shady things and not having the backs of regular people there is a lot of unity and bipartisanship in congress.
  • zx8080 7 days ago
    Tell me it's not a corruption.
    • themitigating 7 days ago
      I can tell you the headline is manipulative BS because they were questioning the ability of the SEC to investigate these types of companies in general and they didn't specifically mention FTX
  • rdxm 8 days ago
    undefined
  • egberts1 8 days ago
    Paywall
  • woodpanel 7 days ago
    You know things are looking bad if out of the gazillions of $ FTX laundered into the DNC they front-run their "reports" with the handful Republicans which were allowed to nibble at the trough.

    Meanwhile, SBF is still not in jail and on the contrary even invited to speak: https://twitter.com/andrewrsorkin/status/1595517635441090565