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Today was the day I finally lost it. After hundreds of hours spent on Congressional committee hearings (listening to audio streams or reading transcripts), after over 40 oxdown hearing diaries since September and more than 100 hearing postings before that (starting when scarecrow asked me to include hearing info in the thread of his Monday morning posts), today’s House Financial Services Committee hearing with Geithner, Bernanke and Dudley was just too much.

I’m sick of watching hearings organized into 5 min question periods designed for sound bites and YouTube clips. I’m sick of watching ignorant Congress Members who can’t be bothered to stay for the whole hearing ask questions which if we’re lucky were written by a competent aide (which means the Congress Member doesn’t know enough to ask effective follow up) or if we’re not lucky are faux outrage grandstanding for a YouTube clip. I’m sick of watching witnesses permitted as Geithner, Bernanke and Dudley were today to distract, delay and in the end obscure when we are in such need of transparency and accountability.

Enough already.

Message to Congress: We’re in an economic crisis. A crisis that began a year and a half ago and that you have yet to show any interest in understanding let alone taking effective action to address. That has got to change. Right now. No more business as usual. It’s time to put aside your egos and your plans for re-election because it’s way past time for you to focus on what needs to be done for the millions of people who depend on you.

I know I’m not alone in being frustrated because rarely have I had to listen to a hearing alone (and for that I am profoundly grateful). So I’m going appeal to all my dear fellow hearing watchers: What do you think needs to be done? What should we be demanding from the committees?

Yesterday I called both the House Financial Services and the Senate Banking, Housing, and Urban Affairs Committees and was told that there are no rules or other impediments for having committee counsel (or other committee staff) do the questioning during hearings. That’s something I think we need – knowledgeable, experienced lawyers questioning the witnesses. And they should have a support staff that includes the best investigators that can be found. When I mentioned this to William Black during his visit here yesterday he replied, as he had to several other questions, that what we need is our own Pecora investigation (something that John Anderson also recently suggested). From Wikipedia:

Following the Wall Street Crash, the U.S. economy had gone into a depression, and a large number of banks failed. The Pecora Commission initiated major reform of the American financial system. As Chief Counsel, Ferdinand Pecora personally examined many high-profile witnesses that included some of the nation’s most influential bankers and stockbrokers. As the Commission’s first witness, Richard Whitney, president of the New York Stock Exchange, declared that "The Exchange’s refusal to pay heed to popular demand for reform was simply a manifestation of courage to do those things which are right, regardless of how unpopular they may be for the time being." Other important members of the Wall Street financial community to give testimony before the Commission included investment bankers Otto H. Kahn, Charles E. Mitchell, Thomas W. Lamont, and Albert H. Wiggin, plus celebrated commodity market speculators such as Arthur W. Cutten. Given wide media coverage, the testimony of the powerful banker J.P. Morgan, Jr. caused a public outcry after he admitted under examination that he and many of his partners had not paid any income taxes in 1931 and 1932.

As reiterated by SEC Chairman Arthur Levitt during his 1995 testimony before the United States House of Representatives, the Pecora Commission uncovered a wide range of abusive practices on the part of banks and bank affiliates. These included a variety of conflicts of interest such as the underwriting of unsound securities in order to pay off bad bank loans as well as "pool operations" to support the price of bank stocks. The hearings galvanized broad public support for new securities laws. As a result of the Pecora Commission’s findings, the United States Congress passed the Securities Act of 1933 and the Securities Exchange Act of 1934, instituting disclosure laws for corporations seeking public financing, and in 1935 formed the SEC as a means to enforce the new Acts.

In 1939 Ferdinand Pecora published his memoirs that recounted details of the investigations. Titled "Wall Street Under Oath", Pecora wrote: "Bitterly hostile was Wall Street to the enactment of the regulatory legislation." As to disclosure rules, he stated that "Had there been full disclosure of what was being done in furtherance of these schemes, they could not long have survived the fierce light of publicity and criticism. Legal chicanery and pitch darkness were the banker’s stoutest allies."

Of course, the key to this kind of real investigation is who would lead it. William Black told us "Jack Blum and Saul Wisenberg (Dem., Rep) as counsel. Hire Dick Newsom and Chris Seefer as your key investigators".

Sounds good to me.

I’m considering calling up every single member of the House Financial Services Committee and the Senate Banking Committee tomorrow and demanding that they take the necessary steps to begin our own Pecora-type investigation: the Blum-Wisenberg investigation. In the mean time they could immediately make the hearings more effective by 1) staying for the entire hearing – they might learn something, 2) giving their time for questioning the witnesses to the most appropriate committee staff person and 3) dispensing with the 5 min rule.

What do you think?