The SEC Chief Economist, recently, suggested that the SEC include more economic cost-benefit analyses when considering new rules.

These comments were the result of recent United States Court of Appeals for District of Columbia Circuit decisions striking down SEC’s regulations because the Commission had failed to conduct adequate cost-benefit analyses.  Such challenges are becoming more frequent, requiring the Commission to re-visit rule making that had previously been approved.  The SEC’s Chief Economist seems to be proposing a more formal role to allow the SEC economists to opine on issues before the rules are approved. 

In sum, the SEC will have a very challenging balancing act in the next year, regarding cost benefit analyses and the use of SEC Staff economists.