If you fall within the 61% of Americans who own stock in a 401(k), IRA, mutual fund, or other investment account, you should be very concerned about the schemes that President Donald Trump and Tesla CEO Elon Musk have planned for the Securities and Exchange Commission. The SEC is tasked with policing Wall Street and large corporations in order to ensure that companies tell investors essential information and investors are protected from fraud and unfair securities trading.
Without a strong SEC, there could be widespread speculation, fraud, and a worldwide loss of trust in the integrity and opportunities of U.S. securities markets.
Trump, Musk, and their Wall Street allies could take America back to the 1920s, a time when unprecedented speculation, encouraged by banks and brokers, ran rampant in capital markets and led to the Great Stock Market Crash of 1929. As a result, stocks lost approximately half their value, decimating the savings of millions of American families and businesses and contributing to the Great Depression.
In the midst of that economic depression, President Franklin Roosevelt worked with Congress to establish the Securities and Exchange Commission. Because of the SEC’s diligent efforts, American capital markets emerged from the Great Depression, quickly recovered, and went on to become the largest and most trusted capital markets in the world today.
Yet, Trump and Musk have spent the last month rapidly dismantling the most important protections investors and consumers rely on to protect them from the unfettered profit-seeking of banks, corporations, private equity funds, and crypto firms.
Trump’s acting SEC chair has already disbanded many enforcement efforts aimed at fraud and securities violations by the crypto industry; made it easier for company executives to ignore their own shareholders’ proposals; stopped collecting data critical to policing market manipulation, including by foreign bad actors; allowed large firms to delay disclosing certain trading activity that is potentially abusive and will now remain hidden; and taken steps to roll back a rule that would have required companies to disclose climate-related financial risks, at a time when thousands of homes and businesses have been destroyed by flooding and wildfires that were fueled by climate change. And Trump himself issued an executive order that attempts to subject independent agencies, including the SEC, to White House oversight and likely political interference.
Meanwhile, the richest man in the world and his DOGE team are seeking entry into the personal records of millions of American consumers at the Social Security Administration, the Internal Revenue Service, and other agencies, putting Americans’ personal information at risk. And the only agency whose sole mission is to protect consumers’ financial transactions with banks and credit card companies, the Consumer Financial Protection Bureau, has ground to a halt.
Trump and Musk’s DOGE are poised to defang the SEC further, potentially shielding companies (including their own, possibly) from SEC enforcement actions. The integrity and transparency the SEC ensures within our capital markets is in jeopardy.
Allowing Musk’s DOGE team to inject itself into the SEC poses significant risks because of the agency’s access to unique, non-public financial data from individuals and companies, which could be misused for personal gain or vendetta.
Here’s what American investors should know. Without a strong SEC, your retirement savings are at greater risk. The companies in which you invest may tell you less and get away with more. The companies you pay to be your broker or investment adviser may be more likely to rip you off. A weak SEC could harm our markets, as investors in the U.S. and abroad, who have long gravitated to our markets because of their integrity and rules, could instead shun them in favor of more reliable opportunities in other countries. And a weak SEC would almost certainly allow more terrorists to obtain financing in our capital markets and criminals to launder illegally-obtained funds, putting our national security at risk.
If the rest of the world no longer trusts our markets, that would reduce the capital available to keep our economy going. The schemes of Trump and Musk to weaken investor protections will enrich them and their allies at the expense of the rest of us.
The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.
Read more:
- How the Trump admin transformed the U.S. into the financial Wild West in a matter of weeks
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- Federal budget cuts threaten to decimate America’s AI superiority—and other countries are watching
