U.S. Business Stars Discuss Rules, World Market

Two former Federal Reserve chairmen, a former Treasury secretary, numerous CEOs and the fabled investor Warren Buffett were among the participants in a conference on the U.S. economy Tuesday. Treasury Secretary Henry Paulson convened the session to discuss proposed regulation changes.

The conference of government and finance leaders came amid growing criticism from business groups of tighter regulations ushered in by the Sarbanes-Oxley law five years ago.

The participants at the event, held at Georgetown University's Gaston Hall, simultaneously expressed confidence in the U.S. economy and worry about its ability to remain competitive in the future.

There is consensus on the need for more — and better — education in math and science. And there is agreement too, on the need for immigration reform.

On the issue of regulation, former Fed chairman Alan Greenspan said that, despite the best efforts of the United States to keep up, global markets are moving faster and becoming more complex.

But the issue that many of the business leaders came to talk about was much more specific. Business groups like the U.S. Chamber of Commerce have stepped up their criticism of the regulatory crackdown put in place after the accounting scandals at Enron, Worldcom and other companies.

The Sarbanes-Oxley rules have had some unintended consequences, says former Treasury Secretary Robert Rubin, who said he is particularly concerned about a requirement that CEOs sign a statement guaranteeing the accuracy of their company's financial statements.

Rubin said "the problem is, five years later, if something goes wrong, you're going to be challenged in a court in which those judging what you've done know very little about the context" of what happened.

Hoping to bolster the case for change, the Chamber of Commerce released a report with a number of recommendations. It encourages publicly traded companies to stop issuing quarterly earnings guidance. That, the Chamber says, would discourage companies from cooking the books to meet Wall Street expectations.

The Treasury is expected to use some elements from the conference to develop specific steps to keep U.S. markets from falling behind.

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