Maybe Congress Will Investigate the Mortgage Crisis After All
In the wake of the Great Depression, a Congressional panel known as the Pecora Commission investigated Wall Street’s actions and set the stage for financial regulation that lasted for decades. Last week, we noted that despite calls from some on the left, a new Pecora-style probe would be unlikely, given that Congress itself undid many of those same regulations and contributed in a substantial way to the subprime crisis.
But not so fast. Sam Stein at The Huffington Post reports that Congress may move soon on an investigation modeled after the Sept. 11 commission to examine the financial meltdown:
The House of Representatives came to agreement on Monday afternoon on the establishment of a 9/11-styled commission that would be independent of Congress and granted the power of subpoena to investigate the origins of the financial crisis.
Aides on the Hill said that the House will likely vote on the measure Wednesday, adding that the chances of passage were high. The office of the bill’s cosponsor, Congressman Darrell Issa, said the legislation would be similar to that recently passed by the Senate.
The concept of the commission is pegged to the investigative body that looked into the intelligence collapse precededing the terrorist attacks on 9/11.
The key, in this case, is that the body – eight or (likely) ten members, split evenly by party affiliation – would have the power of subpoena, compelling the key players to testify. “It is,” said one staffer involved in the creating of this legislation, “essential.”
If a commission does get approved, look for it to be extremely busy. There’s plenty to investigate, from securities fraud to all the political moves to strip financial regulations. This may not mark the return of the Pecora Commission, but it could come pretty close.