To SEC or Not to SEC?

It's safe to assert that it's been a bad year for the Securities and Exchange Commission, and now the power -- perhaps even the existence -- of the agency that missed Madoff (or ignored his mischief) is at stake.

Unsurprisingly, SEC Chair Mary Schapiro is objecting to a plan being considered by the Obama administration to create a new financial watchdog to protect consumers, which would reportedly reduce the SEC's authority.

From the New York Times:

"The proposal the administration was considering would centralize the enforcement of laws that protect consumers of financial products, such as credit cards, mortgages and mutual funds. That effort currently is spread across a number of federal and state agencies, including the SEC, with oversight of mutual funds and other investments, the Federal Reserve and Federal Trade Commission."

Is this a good idea? Should the government instead choose the option reportedly favored by Schapiro, which would leave the SEC and other agencies intact, pulling members from several to sit on a "systemic risk council" charged with monitoring the financial system? Or should we revisit the Treasury Department's Blueprint for Financial Regulatory Reform, offered up last June before the subprime crisis turned into the economic crisis?

For those who don't remember (a lot has happened since then!), that plan sought to slash the number of regulatory agencies that police Wall Street to three: one to regulate banks, another to oversee consumer protection and business practices, and the third -- the Federal Reserve -- to regulate any aspect of the markets to ensure stability.

Which brings up another point: Should the part-public, part-private printer of all our green be its regulator, too? Because that's the option the White House is reportedly leaning toward.