But the argument that gets made most often on the flip side is that "the law is perfectly clear, it's not the SEC's job to indicate what's illegal", which stands in contradiction with what you're saying (which I agree with).

The fact is, there's lack of clarity abound; the SEC is obviously lacking clarity and feeling their way around, yet they take the stance I mentioned, that the law is already clear, and they don't need to engage with the community and other regulatory bodies to create clarity.