Henry Waxman (D-CA) is cancelling the tongue-lashing for CEOs that adhere to generally accepted accounting principles:
A House Energy and Commerce Committee spokeswoman tells me that Chairman Henry Waxman, D-Calif., has indeed cancelled the April 21 subcommittee hearing in which CEOs were to testify about Obamacare. So far, the only indication of this change appears on the committee’s website is on the Republican minority ranking member’s site. In fact, the hearing still appears on Waxman’s committee calendar for that day. . .
The CEOs, required by law to be honest about earnings projections, re-stated their bottom lines in reaction to Obamacare’s passage, earning the ire of Waxman and other Democrats.
Hearings on this matter would likely have proved an embarrassment to the Democrats and helped drag out discussion of Obamacare’s unexpected ill effects.
It’s a pity; I was looking forward to the heaings. They would have been a serious embarrassment for Democrats, since the CEOs were doing precisely what is required of them by law. As Megan McArdle explained at the time:
Accounting basics: when a company experiences what accountants call “a material adverse impact” on its expected future earnings, and those changes affect an item that is already on the balance sheet, the company is required to record the negative impact–”to take the charge against earnings”–as soon as it knows that the change is reasonably likely to occur.
This makes good accounting sense. The asset on the balance sheet is now less valuable, so you should record a charge. Otherwise, you’d be misleading investors.
The Democrats, however, seem to believe that Generally Accepted Accounting Principles are some sort of conspiracy against Obamacare, and all that is good and right in America.