Merely one month ago, the Financial Crisis Inquiry Commission — commonly referred to as Pecora 2 — held its first meeting.

Hopes were high, as Phil Angelides, former California State Treasurer and Chair of the Commission, outlined the commission’s goals: to provide an “unbiased accounting” of the root causes and events behind the recent market meltdown on Wall Street, and optionally, to advise on future remedies and reforms.  (For those unaware, the original Pecora Commission investigated the causes of the stock market crash of 1929.)

Can the commission muster enough firepower to get the job done with Wall Street fiercely resistant to any investigative inquiries and Washington conservatives pointing to Freddie Mac and Fannie Mae as the obvious culprits?

What’s your take? Compare what Zach Roth has to say in TPM (Talking Points Memo) with Tim Fernholz’s observations in The American Prospect.[column width="47%" padding="6%"]

Zachary Roth asserts:

The Republican-appointed Vice-Chair, Bill Thomas, an “acutely partisan supporter of big business” and “whose support is required by law for the commission to perform several other key functions, like hiring staff” looks like the most ominous sign for the commission.

More talking points:

• “From the start, Congressional Republicans managed to game the rules of the commission so as to allow their appointees to effectively hamstring it.”
• Although the newly established commission has subpoena authority…“the final bill requires that for it to do so, at least one of the commission’s Republicans must vote in favor — a change from the original language, which required only a majority vote or the agreement of the chair and vice chair…Republicans threatened to withdraw their support for the whole idea of a commission if this change wasn’t made.”
• “None of the three rank-and-file Republican appointees seem like good candidates to break ranks.” He refers to Peter Wallison, a fellow at the American Enterprise Institute; Doug Holtz-Eakin, John McCain’s top economic adviser, known for declaring that  the fundamentals of the economy were strong; and Keith Hennessey, former economic adviser to President Bush and former aide to Sen. Trent Lott.

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Tim Fernholz disagrees:

Bill Thomas, Republican Vice-Chair on the Commission, was surprisingly congenial and admitted that regulatory reform was inevitable and that “making it work correctly was critical.”

More talking points:

• The more conservative members on the commission seem more open-minded than their peers on other Congressional panels (save Peter Wallison, who could serve as the “poison pill” in the mix).
• The appointment of Thomas Greene as Executive Director of the Commission bodes well. “Greene, a lawyer, has done complex investigatory work both in Washington, D.C. and in California, coordinating anti-trust and securities investigations in a variety of venues. The appointment is critical; recall that the Pecora Commission was named after its executive director, Ferdinand Pecora, not the members of congress who constituted the actual committee.”
• The commission addressed concerns that their work would be irrelevant by the time they turn in their report in December 2010 in this way: “[T]hey noted their intentions to release regular working documents and continue holding public hearings, the fact that regulatory reform, even if a major overhaul is passed early next year, will be a continuing process, and that future regulators will require a blueprint of the past crisis in order to avoid the next one.”

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