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Today I wrote a letter to Senator Christopher Dodd (D-Ct), Chair of the Senate Banking Committee, urging him to (1.)initiate oversight hearings into the credit and subprime crises, and (2.) to draft a letter to the United States Department of Justice requesting that they begin an immediate investigation into possible abuse, fraud, and criminal wrongdoing.
Over the past few weeks, it has become increasingly clear to me that as the Federal Reserve Bank of the United States charters new policy territory in intiatives it has undertaken to resolve the financial crisis increased oversight and assessment is necessary.
What is particularly worrisome is that the Fed's actions, like the credit crisis itself, is in many ways unprecedented. Therefore, it is sound public policy to provide oversight to determine if the new policies are having the desired effects and to gauge the full scope of the crisis itself. Because of the extremely sophisticated use of securities and derivatives, no one is quite sure the extent of the problem, including the major financial houses who hold these securities and derivative instruments.
That the government needs to be acting in the broad public interest, and not solely in the interest of elite institutions, is self-evident. Providing such oversight will also provide the additional benefit of guiding both legislators and policymakers in future actions if required. What is manifestly unacceptable, and contrary to the public interest, is that the federal government continue to take blind action without a methodical process to measure and assess economic and policy outcomes.
Moreover, the time is long overdue for the government to begin to take some assessment of what if any criminal activity may have been involved in the credit, financing, and lending processes which have led to the current crisis. The public should expect quick and vigorous action to detect and end any such criminality.
I urge you to contact Senator Dodd to express your views on what initiatives his commiittee might take on this matter. I would, of course, also welcome letters in support of the actions which I have called for in my correspndence with him and other US Senate Banking Committee Members.
Here is the link to Senator Dodd (D-Ct):
http://dodd.senate.gov/index.php?q=node/3128&cat=Opinion
Here is a link to the US Senate Banking Committee:
Thank you.
