For almost 20 years, the Tower Amendment has blocked a healthy, full-fledged development of the municipal bond market, and we're happy to see that the incoming chairman of the House Banking Committee is going to introduce legislation on Jan. 4 to repeal it.

The Tower Amendment, which was added in 1975 to the Securities Exchange Act of 1934, bars the Securities and Exchange Commission and the Municipal Securities Rulemaking Board from requiring municipal bond issuers to register their bonds. So the authorities have had to back into the matter, requiring underwriters to distribute official statements describing unregistered municipal bonds. The system is a confusing Rube Goldberg contraption, and it has resulted in serious information gaps -- as Orange County's bankruptcy proves.

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