Troubles at the FCIC

Today, the Financial Crisis Inquiry Commission — the bipartisan panel examining the causes of the financial crisis that plunged the country into recession — is up with another round of hearings. The FCIC is due to complete a comprehensive report, à la the Pecora Commission that studied the 1929 crash, by Dec. 15. But The New York Times reports not all is well:

In May, the commission’s executive director was moved aside and succeeded by an economist from the Fed, a decision that drew criticism since the central bank is an object of the investigation because of its leading role in handling the crisis. In addition, five of the commission’s 14 senior staff members have resigned, including Matt Cooper, a journalist who was drafting the report.

Moreover, the commission’s chairman, Phil Angelides, and vice chairman, Bill Thomas, are finding it challenging to maintain support from all eight other commissioners. While squabbling within the panel has not broken into open dissent, several commissioners are divided over how much to blame specific individuals and banks, how and when to release the documents it has gathered and whether to make available testimony of government officials and bank executives it has interviewed privately.

In a joint interview by phone on Tuesday, Mr. Angelides, a Democrat, and Mr. Thomas, a Republican, said that the turnover’s effects had been exaggerated and that they were optimistic about a consensus.

“We’re doing our very best, and we will do our level best,” said Mr. Angelides. He said he had spoken recently with Thomas H. Kean, the former New Jersey governor who led the 9/11 Commission, which produced an acclaimed report that was a surprise best seller. “Several weeks out, they doubted whether they would get any kind of agreement on anything,” Mr. Angelides said.

The FCIC has always been something of a lame duck. It will complete its work months after the financial regulatory reform bill became law, and will have done little to help legislators draft the bill. Moreover, its report will come out after dozens of other books and reports on the financial crisis — long after government, journalism, economics and Wall Street itself got a handle on, if not a perfect understanding of, just what tipped banks into chaos.

That said, the FCIC is performing an enormously important function in demanding answers of the Wall Street titans responsible. It used its subpoena power, for instance, on Warren Buffett. And today, the FCIC is speaking with Dick Fuld, the now-reclusive former head of Lehman Brothers, whose spectacular collapse kicked off the worst of the credit crunch.