KeithHennessey.com

Conventional wisdom says the tenure of President George W. Bush was dominated by partisanship. This conventional wisdom ignores significant bipartisan legislative accomplishments led by President Bush. If President Obama wants bipartisan legislative success, he could learn a few things from his predecessor.

To understand the causes of the financial and economic crisis, I place a high priority on understanding why some firms failed, and why others would have failed but for direct government support. In our investigative work the commission needs to spend time on failure analysis. At the top of my failure analysis list are Fannie Mae and Freddie Mac.

Here is a working draft of questions I would like to ask the bank CEO’s tomorrow. I am focusing on the Too Big To Fail (TBTF) concept and how it changed perception and behavior.

The Financial Crisis Inquiry Commission staff has released the details and full witness list for our first substantive hearings this Wednesday and Thursday. Here are the panels and hearing details. In addition, I am asking for more help developing tough questions for the witnesses.

At the first substantive hearing of the Financial Crisis Inquiry Commission next week, four bank CEO’s will testify. What question do you recommend I ask these men about the causes of the financial crisis?

Chairman Conrad may get his commission, although I doubt it he will get it now. He may get his vote, although I doubt as an amendment to a clean debt limit bill. If he confronts Leader Reid over the debt limit, either in private or on the Senate floor, Reid has all the leverage. He can force Conrad to back down.

Under current law it is not legally possible to “use” returned TARP funds for a new stimulus proposal. The Administration and its Congressional allies want to describe their proposal this way to make it appear that their new spending does not increase the federal deficit and debt. Even if the TARP law is changed, new government spending is just that, new government spending. No matter what optical gimmicks are created, new spending will increase the deficit and debt.

If you’re advocating a policy to subsidize coverage for people who are now uninsured, I hope you’ll argue that the benefits to those uninsured are worth the higher costs to others. Don’t argue that we’ll save money overall, or that it will financially benefit those who are now insured. This one isn’t a free lunch.

I posted yesterday about Budget Director Peter Orszag’s claim of inherited deficits from his Tuesday speech at NYU, titled “Rescue, Recovery, and Reining in the Deficit.” Today I want to look at the rest of Director Orszag’s remarks.

Senate Majority Leader Reid’s floor speech last Monday was a broadside attack on the financial sector from the fourth most powerful person in Washington (Bernanke is #2.)

It is tempting to dismiss Leader Reid’s remarks as opportunistic demagoguery, but they forced me to think harder about my views on this important topic.