What's their game?
Buried in bills recently passed by the House and Senate is a provision to
"privatize" the Electronic Data Gathering, Analysis and Retrieval (EDGAR) system
of the Securities and Exchange Commission.
Not surprisingly, SEC systems officials are scratching their heads over the meaning of
this provision, because most work for EDGAR already is done by contractors.
As we reported in our July 8 issue [Page 69], the question for the SEC hinges on the
difference between "private" and "outsourced." With such terms being
bandied about with increasing frequency, it's a good time to define them precisely.
To me, privatizing implies that the operators of a system become the owners, and are
not necessarily responsible to the original agency. In many cases, privatization means
creating a government-owned corporation.
Outsourcing a function means the agency still controls it.
Does Congress mean to create a sort of "EDGAR Service" similar to the Postal
Service? Nobody (including Congress, I suspect) knows, and that's part of the problem.
But there's a more important question here. Simply: What is the objective of
privatizing EDGAR? The way the provision is written seems to fly in the face of the
approach to information technology intended by the Information Technology Management
Reform Act, the so-called Cohen Bill--our generation's Brooks Act.
Cohen and others on the Hill profess frustration at what they perceive as the inability
of many agency officials to answer the simple question, "What are we really buying
with this system?" The whole CIO act and its unfolding implementation are geared, in
part, to creating meaningful performance measurements for systems projects. A reasonable
Therefore, it's also reasonable to expect that when Congress legislates down to the
detail of a particular data gathering system, that it be specific about what this effort
should produce. Yet there's nary a clue in Rep. Jack Fields' HR 3005 about this, much less
what is meant by "privatize."
Another point: EDGAR is no Tax Systems Modernization, no FAA modernization. Shaky
initially, EDGAR works, and it's eliminating tons of paper filing. It is hardly a troubled
system or an endless money sinkhole.
The SEC deserves a clearer explanation from the Hill.