“What I Wanna Know” is a new series from CJR, in which we invite outside experts to propose questions about the ongoing economic crisis and the many efforts to mitigate it, in the hope that journalists find them thought-provoking and helpful as they cover this sprawling story.

Bevis Longstreth is a retired partner with Debevoise & Plimpton LP. From 1981 to 1984 he was a member of the Securities and Exchange Commission.

1) To Securities and Exchange Commission chair Mary Schapiro: From its formation in 1934, the SEC has had the statutory power to adopt, change, and interpret accounting principles and require their use by publicly traded corporations. Having chosen to delegate this power to private bodies, such as the Financial Accounting Standards Board, the SEC has only on occasion directly overruled the FASB (or its predecessors). The FASB has recently, under pressure from some members of Congress and from an army of lobbyists representing banks, changed its mark-to-market rules to permit the banks to mark up assets for which there is not an active trading market to higher levels, levels that management thinks the assets would trade at if such a market existed. The change was rushed through without soliciting comment. Where was the SEC leadership in this process? How do you reconcile the change, which will render bank financials deceptive and misleading, with the SEC’s main mission of protecting public investors?

2) To Congress and President Obama: The Federal Reserve Board is self-funded, which helps it maintain independence from the Congress and the Executive Branches as well as from the financial institutions under its jurisdiction. The SEC, on the other hand, must seek annual appropriations from Congress to carry out its duties. All fees it collects, which far exceed its budget, must be turned over to the Treasury. To help the SEC avoid agency capture by those it regulates and undue influence from the Congress, two threats to its effectiveness that a careful reading of history will demonstrate have been too often realized, do you think the SEC should be self-funded like the Fed?

3) To Congress and President Obama: Auditing is a “public utility” function—i.e., affected with the public interest. The number of large private audit firms capable of handling mid to large sized public corporations has declined to only four, which are now admitted to be “too few to fail.” In addition, pressure continues to grow for capping liability for audit failures, no matter how egregious. The remaining firms are adamant in opposing a utility-like limit on their profit margins. Do you believe that the profit motive is fundamentally at odds with the audit function, at least where an oligopoly exists, liability is capped and profits are unconstrained and unknown, and if so, would you favor having Federal government auditors perform audits of public corporations, along the lines of bank examiners?

Bevis Longstreth is a retired partner with Debevoise & Plimpton LP. From 1981 to 1984 he was a member of the Securities and Exchange Commission.