Tuesday, October 27, 2009

Commission Impossible

How the Angelides Commission can crack open the Wall Street scandal—if it dares.

By Eliot Spitzer

Commissions are often created to defer tough decisions; to forge a consensus around a hard solution to a genuine problem; and, rarely, actually to delve into underlying facts. The Angelides commission, officially chartered by Congress this summer as the Financial Crisis Inquiry Commission, has the chance to be that third kind of commission, gathering the missing empirical data on fundamental questions that can guide future decision-making.

We already know an awful lot more about what happened last year than we did in 1932, when the legendary Pecora commission was created to investigate the Wall Street crash. We know the fundamental violations of sound banking practice and regulatory failures that brought us to the precipice. Yet there are still critical areas that would benefit from the commission's detailed analysis: four structural issues that have not yet received adequate attention and one particular transaction that is still highly ambiguous.

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