Johnny Isakson and ‘CSI: Wall Street’

Many of you thrill to the rubber-gloved glamour of “CSI.” Enough that we also have the gore-spattered clone “CSI: Miami” — and even “CSI: NY.”

By Jim Galloway, Atlanta Journal-Constitution — Jan 25, 2009

U.S. Sen. Johnny Isakson wants one more forensic spin-off. Let’s call it “CSI: Wall Street,” a can’t-miss crime-scene drama with a riveting story arc: Who done in the corpse that is now your 401(k)? Who left fingerprints on your now-empty piggy bank?

And who, when you’re a brittle 78 and shuffling off to that job at Wal-Mart — your retirement reduced to a cushioned rubber mat at the store entrance, will deserve your muttered curse for bringing on the Crash of ‘08?

The Georgia Republican has paired with a Democrat, Kent Conrad of North Dakota, to demand an investigation into the near-collapse of the nation’s banking system and the evaporation of trillions of dollars.

They would style it after the bipartisan and independent 9/11 Commission, with subpoena powers and instructions to pass on to prosecutors any evidence of wrongdoing. Like its 9/11 brother, the Financial Markets Commission would have 12 months to do its job.

The idea alone is a sign of a new day in Washington. Many Republicans opposed the formation of the 9/11 Commission, fretting that it would be used to hammer the Bush Administration.

But there is no Bush Administration left to protect. “This is not a fishing expedition. This is an expedition to find out where the blame lies and let the chips fall where they may,” Isakson said in an interview. “We did not limit how far back the commission could go, because I think some of the decisions may have been made as far back as the ‘80s.”

And remember, the senator said, the recommendations of the 9/11 Commission turned out to be quite useful — and popular, too.

Just as refreshing is the possibility of renewed Washington faith in the concept of action based on actual fact. Steaming tureens of legislation are about to be thrown against the wall, just to see what sticks, Isakson said. It might just be worthwhile if Congress were to discover the problem before launching the solution.

“As you peel the onion back, you start learning an awful lot of things,” he said. For instance, we know that mortgages were handed out to many who couldn’t afford them. And that Fannie Mae and Freddie Mac encouraged this “to create liquidity so we could raise the number of homeowners,” Isakson said.

But what led Moody’s Investors Service, one of the great referees of Wall Street, to rate these bundled-together husks as worthy of investment? What was Moody’s interest and where is the accountability? the senator asked.

Last summer, in the lead-up to the collapse, commodity futures became another bubble that compounded the damage — a place to recover losses in a declining market. Remember $5-a-gallon gasoline?

“If you peel back the onion, it was driven because people like the Princeton [University] endowment fund and the Harvard [University] endowment fund were induced to take their money and invest it in a speculative market,” Isakson said. “Why would a Princeton endowment fund buy pork bellies?”

Then there were the hedge funds that were allowed to bet in favor of a decline in the stock market, reinforcing the drop. And the financial instruments that were created and traded in the dark for years. The list goes on and on.

An investigating commission is justified because, though the current financial collapse lacks the bloodshed of 9/11, the economic impact is just as devastating, Isakson said.

But there is a subtle, political difference between then and now. When the concept of a 9/11 Commission was pitched, everyone involved knew that — while this government agency or that one might be faulted — ultimate responsibility lay with a set of monsters that death had put out of reach.

This economic catastrophe is self-inflicted, and its authors wander among us, with both money and lobbyists. And Washington hasn’t changed that much.