Pelosi Calls for Commission to Investigate Wall Street

With an eye toward quelling the populist anger roiling across the nation, House Speaker Nancy Pelosi today called for the creation of a commission to root out the causes of Wall Street's meltdown patterned after an obscure Depression-era committee.

In San Francisco to speak about her book encouraging the rise of women in society at a gathering for the Commonwealth Club of California, Pelosi said Americans are angry with the economy and bonuses given to AIG, and at least 75 percent of them want an investigation into the missteps that led to this recession.

"That's what we would do with this commission, is to make sure it does not happen again," she said.

Pelosi spoke with Treasury Secretary Timothy Geithner this morning about the plan to emulate the Pecora Commission created in 1932. That commission, named after Deputy District Attorney of New York County Ferdinand Pecora, followed two failured attempts but ultimately benefited by Franklin Roosevelt's election to the presidency. The commission's findings led to the Securities Act of 1933 and the creation of the Securities and Exchange Commission – itself alleged by many to have been lax in regulating Wall Street (with Bernard Madoff's infamous Ponzi scheme being the poster boy for this age).

“Some people can tell you one piece of it. Others can tell you another piece of it. It's really hard to know. Do you understand it?” Pelosi asked rhetorically. “We need a clearer understanding of how we got here.”

Pelosi is not the first politician to allude to the Pecora Commission in recent weeks. Democratic Sen. Byron Dorgan called for a new iteration of the committee along with the resurrection of the Glass-Steagall Act, which separated commercial and investment banking. Many believe its repeal in 1999 was the impetus for banks and investment firms like Citigroup and Travelers to merge and allow the subprime credit markets to run rampant. (Wells Fargo Chairman Dick Kovacevich gave the banks' side of the deregulation story in a speech to The Commonwealth Club in 2008. Click here to view video.) A New York Times editorial last month also called for a Pecora-like commission to be created.

Besides making news with her call for a Wall Street investigation, Pelosi had a full schedule. Earlier in the day, appearing on the local Fox affiliate KTVU, Pelosi characterized an upswing of “Tea Party” tax protests as window dressing for elite conservative interests that mainly wanted lower taxes, mocking them as “Astroturf” or fake “grassroots.”

The Speaker also drew upon her personal biography to encourage woman to continue reaching for more positions of power. Her book, Know Your Power: A Message to American Daughters urges women to get involved in all aspects of community service. Pelosi is the daughter of the Baltimore establishment and said she found politics both exciting and distasteful. “It taught me I didn't want to be a part of it,” she said.

While raising five children with husband Paul Pelosi – who incidentally spent the speech doting over their newest grandchildr – she slowly became immersed in Bay Area politics with her big break occurring in 1976 when she secured Maryland for a youthful Jerry Brown in the Democratic presidential primaries. Pelosi joked, though, that the then-governor of California had a problem with saying, “thank you,” but he nonetheless found time to praise her for delivering Maryland to his campaign.