It seemed reasonable enough: Protect the little guy from big risks in hedge funds. But the public comments suggest little guys don’t want any help. Fortune Magazine reports.

You almost have to pity the poor SEC. Recently, the commission was all but accused of a cover-up by Senators Grassley and Specter in the matter of Gary Aguirre.

(You may recall that Aguirre, a former SEC lawyer, complained that he was fired by the commission for complaining that an insider trading investigation of hedge fund giant Pequot Capital was squashed for political reasons.)

Before that, Phillip Goldstein, a hedge fund manager few had heard of, had the temerity to sue the SEC over its controversial 2004 rule that forced managers to register with the commission. And Goldstein won!

The latest is the furor over the SEC proposal, made in December, to lift the minimum wealth required to invest in hedge funds. In 1982, the bar was set at $1 million in net worth; the SEC proposed adding to that a requirement that a would-be investor also have $2.5 million in investments.

“We are therefore proposing to define a new category of accredited investor, which is called an ‘accredited natural person,’ which is designed to help ensure that investors in these types of funds are capable of evaluating and bearing the risks of their investments,” wrote the SEC.

Who could quibble with the SEC on this one? After all, everyone, from politicians to the press, both here and abroad, has been shrieking in increasing apocalyptic terms about the myriad dangers that big, bad hedge funds pose to poor, small investors. Why not protect those poor, small non-accredited and presumably unnatural people from themselves?

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