Issa Cancels FCIC Hearing As Dems Expose GOP Commissioners

July 13, 2011 1:00 pm ET — Matt Gertz

Darrell Issa

Political Correction was confused earlier this week to learn that a House Oversight subcommittee hearing scheduled for today on "What Went Wrong At The Financial Crisis Inquiry Commission?" had been postponed indefinitely. Now we know why. In a devastating report released today, the committee's Democratic staff takes apart the various attacks that committee chair Rep. Darrell Issa (R-CA) has leveled at the FCIC over the past months, and points to partisan activity and conflicts of interest on the part of the Republican commissioners.

The FCIC released its final report on "the causes of the current financial and economic crisis" in January. The five Democratic commissioners put much of the blame on the failure of the "captains of finance" to see warning signs and "question, understand, and manage evolving risks." Three of the GOP commissioners dissented, attributing the crisis to a wide array of factors, while GOP commissioner Peter Wallison issued a separate dissent blaming federal intervention into the housing market.

After reviewing more than 400,000 FCIC internal emails, the Democratic staff reports:

  • Wallison repeatedly sent emails to his GOP colleagues on the committee urging that their dissents not "undermine the ability of the new House GOP to modify or repeal Dodd-Frank."
  • Despite claims to the contrary that Wallison made in congressional testimony, the FCIC extensively reviewed his position that the economic crisis was caused by government housing policies, with all eight other commissioners rejecting that view.
  • Wallison was criticized by the FCIC's general counsel after leaking confidential commission documents to a colleague at the American Enterprise Institute in violation of the commission's ethics policy.
  • Republican vice chairman Bill Thomas and his staff provided an economic and political consultant who works at Thomas' law firm — which represents major banks — with a wide array of internal documents, in violation of the commission's ethics policy.

The staff report also rebuts Issa's prior attacks on the FCIC with regard to its financial management, staffing, timing of the report's release, and the disclosure of certain information.

With this report well underway, on July 1, ranking member Rep. Elijah Cummings (D-MD) asked Issa for bipartisan staff interviews of Thomas and Wallison, as the committee has already completed or scheduled interviews of Democratic commissioners and two senior staffers. Rather than approve such interviews, Issa postponed the hearing.

That's the sort of decision you make when your focus is on partisan posturing and attacks, not getting to the bottom of what actually happened.