American Voters Want Congressional Investigations: Will Democrats Seize the Opportunity for 2010?

Plans are already being made for the 2010 elections for the U.S. Congress, and the Democrats would appear to have some advantages. They have a popular president, a 6-percentage-point lead in party identification and 9 points for a generic Congressional ballot. Majorities of the electorate see both Obama and the Democratic Party as pushing for a change from the failed policies of the past. The Republicans seem divided and confused over a recovery strategy, plagued by high-level defections (such as Senator Arlen Specter) and spokespeople (such as Rush Limbaugh and Dick Cheney) that seem too extreme to win over the necessary swing voters.

But the president's party almost always loses Congressional seats in non-presidential-year elections. And if next year's elections reduce the Democrats' margin, it would be even more difficult to make progress on important reform legislation, such as health care. At the end of the day, the ability to deliver reforms that actually improve the lives of the majority of Americans will most likely determine their long-term success as a political party.

The 2010 elections will very likely be about who gets blamed for the current economic disaster. Even if the economy is recovering in the latter half of next year - and that is a big "if" - it will not feel much like an economic recovery for most Americans. The labor market will still be very weak, with unemployment projected to pass ten percent and rising in the second half of next year. Millions will have lost their homes and their jobs, and many millions more will have lost most of the equity that they had accumulated in their homes - the main source of retirement savings for most households. The party that gets blamed for the mess will be most likely to lose seats in Congress.

The Democrats have a chance to defy electoral history and increase their Congressional lead next year, and perhaps even push the GOP toward the status of a permanent minority party. Celinda Lake, one of the Democratic Party's leading pollsters and political strategists, has recently found that 71 percent of voters want Congress to hold investigations into the "events leading up to the Wall Street financial crisis." More importantly, the proportion is just as high among swing voters.

A Congressional investigation, if done right, would probe the errors, excesses, fraud, corruption and other abuses that led to the country's worst recession since the Great Depression. There is plenty of blame to go around, but much of it would probably land on Wall Street and the country's bloated financial sector. The vastly overpaid executives, who made ever-increasing bets on the proposition that obviously over-valued house prices would continue to rise indefinitely, would come under fire.

Some of them were rewarded for their failures with high positions in government: for example, President Bush's Treasury Secretary Hank Paulson, who made $164 million in 2006 at Goldman Sachs during the peak of the housing bubble, helping to steer the economy into an iceberg and then coming to Congress to ask for a blank check of $700 billion to bail out his Wall Street friends.

The most important policy makers, such as Fed Chairman Alan Greenspan - who has to some degree fallen from grace - but also current Chairman Ben Bernanke, might also be asked to explain how they failed to notice the biggest asset bubble in the history of the world as it swelled over a period of several years to obviously threatening proportions.

The obvious analogy to such an investigation would be the famed Pecora commission during the 1930's, as some have pointed out. It was named for its intrepid chief counsel Ferdinand Pecora, who went after the Wall Street titans of that era and helped pave the way for the nation's most important financial regulatory reforms, such as the Glass-Steagall Act of 1933.

The Democratic Congressional leadership thus has a chance do something that could promote badly needed reforms, is desired by an overwhelming majority of voters, and could give them a big political boost. But do they have the guts to do it? We will soon find out.

This column was published by The Guardian Unlimited on June 18, 2009.

Comments

[drh002]

Yes this makes perfect sense. Lets find someone to pin the downturn in the business cycle on. Brilliant. I mean this whole recession thing has never happened before. This so called business cycle is completely unprecedented. The recession is a neo-con conspiracy to deprive the proletariat of wealth! Under no circumstances was this caused by the idiotic lending practices of Fanny Mae and Freddy Mac.
This recession is so bad that we should abandon our free-market oriented capitalist system and embrace the example of socialist France and Germany, never mind that their unemployment at the height of the business cycle was as high as our unemployment during the recession.

I'm sorry I can't continue charade suffice to say that this whole "find who is reponsible for the recession" is a waste of time. It is the business cycle exacerbated by the moronic maneuvers of big government.

[pfrogger]

everybody needs to calm down.
as Noonan said "we need to just keep walking". nothing to see here.

the most important part of this country, Wall Street, is OK and getting better.
so what if they caused this financial crisis?
so what if the execs made millions from the bailout, kept their jobs, and bonuses?
so what if the lower tier people, who had no hand in the decisions leading to the crisis, were the ones fired?
so what if millions lost their jobs, homes, retirement nest eggs, and life savings thanks to Wall Street?

Wall Street has already lobbied politicians so that the politicians have enacted no new laws. credit card % caps - nope. fair housing renegotiation - nope.
true regulatory reform - we're told it's coming, but seriously how good will it be? based on current history, it'll be token regulatory reform. the Fed didn't see, or prevent this financial crisis, and yet they will be given an unprecedented increase in powers. regulatory reform is a joke, and Wall Street will continue along its current path. sorry folks, but frankly they do own the place. isn't it obvious?

[jmpurser]

I think an increasing number of people are taking a long hard look at the Democrats and asking two questions:
1) Where were you during the 30 year GOP rampage of destruction of our nation?

2) Now that you're in charge with barely a vestige of an opposition party why are you STILL utterly incapable of doing the right thing?

If the Democratic party can't come up with some reasonable answers to these questions soon they're going to go the way of the GOP as Americans search for a real party to represent them.

[Dbos]

Our great country is on fire and all congress can do is fiddle.

[SCG]

Investigations? They're too busy wining and dining with the very malefactors which drove our economy to the abyss. (see Giethner's recent past ) Are they going to bite the hand that feeds them campaign funds and speech fees?

The most we'll get is some sort of Kabuki theater. Lots of grand standing waving around signifying nothing. The press eats it up.

[whocan]

The Democrats have been in power in congress since 2006...... No way will they investigate

[olmossy]

In power not counting Dub's famous VETO pen.

[jmpurser]

With "leaders" like Pelosi and Reid you're NEVER "in power".

[Rmath]

Voters have short memories. They tend to place all the blame within the last few years. But the cult of wholesale deregulation and the dismantling of agencies and safeguards meant to protect investors truly began with Ronald Reagan.

[stuporman]

like the public health care option, the people want it so there is no way it will be considered. now if the wealthiest americans would lobby to have themselves investigat­ed....

[dynwitch]

Ain't gonna happen. Unfortunately.

[wrencher]

How much do you want it?

Start sinking Democrats' and Obama's numbers and there will be investigations, hearings and prosecutions of BushCo.

It's in your hands.

[BobLablah]

No way will Dems do an investigation because Barney Frank and Chris Dodd would be implicated as primary contributors.

[TexasDem0]

The Democrats' majority would be even larger if we had a public financed election system, with all verifiable ballots. Let's get some of the stimulus money allocated for that goal.