The Senate is currently trying to pass financial reform legislation, even though many observers wonder if this isn’t somewhat premature given the lack of understanding about the causes of the ongoing financial crisis.
The bi-partisan Financial Crisis Inquiry Commission was hand picked by congressional leadership to deliver a report explaining what happened, but that report won’t come in until December. Meanwhile, Congress is busy making new regulations for the financial industry.
Speaking to the Examiner editorial board, the chairman and vice-chairman of the Financial Crisis Inquiry Commission explained their work would prove vital regardless of what Congress does in the immediate future.
“This debate over how to change our financial system is really just beginning in this country, because true changes don’t just come with a piece of legislation. They are a result of how regulators enforce laws, they are a result of market behavior,” said FCIC Chairman and former California Treasurer Phil Angelides. “And so for example, I’d make two observations. Even if the legislation currently on the docket is passed and signed into law, it will be a piece of legislation that regulators will have to implement and enforce for years to come and our work will be very helpful in providing an understanding of what has occurred.”
But aside from being beneficial for implementing regulations ex post facto, FCIC Vice-Chairman and former Rep. Bill Thomas, R-Calif., suggested that the commission’s timetable was in contrast to the urgent pace of the Senate’s action, which is dictated by political motivations.
“As you’ve noticed, the promised time tables on almost anything [related to financial reform legislation] aren’t being matched, and even now, you had basically a commitment to Sen. Lincoln that they were not going to move the whole derivatives split amendment until after the Arkansas primary. And as a matter of fact, either she was going to win or lose – turns out she didn’t, they’re in a runoff to Jun 8,” Thomas told the Examiner. “I hope you guys read your paper about Sen Dodd’s two year study [on Lincoln's derivatives reform amendment] – that’s called a punt. And anytime you have a punt in this they’re dealing with politics: who gets what, when, and how. And they may even not get to it. They wanted to rush the judgment terms in cutting off debate on cloture, they can’t even get the votes on that. So, first of all, assuming that they’re moving through this in any kind of reasonable fashion means that politics is working smoothly, and I frankly don’t see that…yet.”
The Senate did end up voting for cloture on financial reform less than an hour after the Examiner spoke to Angelides and Thomas.