Yeah, I've been trying to understand where Obama's coming from with his new "investigation" into mortgage fraud.
Firstly, this change of policy has to be the end of the obviously lying meme that everything the banksters did was legal. If it were legal, then there wouldn't be a need for an "investigation". If the crime was so enormous that it requires an independent investigator, why aren't we getting one? Obama was careful to announce that Schneidermann would not be independent, but rather placed under Holder.
The second is a more obvious question: if this is something that has needed to be done for three years, but we're just getting to it now, how is AG Holder keeping his job? How is Geithner keeping his?
There's a discussion of some of the details at Calculated Risk here. They know some of the players who will be with AG Schneidermann, which I don't. Their summary:
So get this: this is a committee that will “investigate.” The co-chair, Lanny Breuer, along with DoJ chief Eric Holder, hail from white shoe Washington law firm Covington & Burling, which has deep ties to the financial services industry. Even if they did not work directly for clients in the mortgage business, they come from a firm known for its deep political and regulatory connections (for instance: Gene Ludwig, the Covington partner I engaged for some complicated regulatory work when I was at Sumitomo Bank, later became head of the OCC). We’ve written at length on how the OCC is such a shameless tout for the banking industry that it cannot properly be called a regulator. Similarly, the SEC has been virtually absent from the mortgage beat, no doubt because its enforcement chief, Robert Khuzami, was general counsel to the fixed income department at Deutsche Bank. That area included the trading operation under Greg Lippmann who we have described as Patient Zero of so called mezz CDOs, or to the layperson, toxic mortgage paper that kept the subprime bubble going well beyond its sell date. And we don’t need to say much about the DoJ. It has been missing in action during this entire Administration.
President Obama seems to be a good person, and I'd sure enjoy the opportunity to have a (gluten-free) beer with the man. But the defining characteristic of his Administration has been impunity for connected actors and putting the hammer down on whistleblowers. We as Americans should expect any energy he puts into the mortgage crisis to be a whitewash, a repeat of Obama's approach on the illegal torture committed by members of the Bush Administration. This is a transparent election year stunt, full of sound amd fury but signifying nothing. The Oligarchy will maintain its hold. And if the commission is too obviously useless, Gingrich will still be able to make a name for himself running to Obama's left on the economy. The only real question is whether or not the Netroots will allow itself to be chumped again.