It will never happen because the very people who would presumably be doing the investigating have the most blood on their hands, but if any aspect of this financial crisis should be investigated it should be Congress itself. Members of Congress will no doubt claim “I didn’t know” or “I was hoodwinked like everyone else” but the fact of the matter remains that they were charged with making the laws that oversaw Fannie and Freddie and they should have known rather than pretending they were authorities on the subject and not actually knowing what was going on or worse, excusing it.
“Mr. Chairman, we do not have a crisis at Freddie Mac, and in particular at Fannie Mae, under the outstanding leadership of Mr. Frank Raines. Everything in the 1992 act has worked just fine. In fact, the GSEs have exceeded their housing goals. . . .”
It’s about time that the American public demand that Congress take a backseat role in regulating things they simply don’t intellectually grasp. The credit markets are specialized and we should empower our regulatory agencies to hire professionals who understand these markets, and Congress should empower those individuals to do their jobs rather than arm chair quarterbacking for sound bites, Sunday morning news shows, and for their own ego gratification.
Furthermore, when Representatives and Senators who are in charge of committees responsible for industries like banking and finance fail in their duties, they should suffer consequences. The voters will hopefully punish them at election time, but more immediately the Speaker and Majority Leader in the House and Senates respectfully should fire them from their leadership position. Instead we have Senator Dodd and Rep Frank still on center stage despite the fact that they are an embarrassment to the Congress at this point, with zero credibility and serious chutzpah remaining.