Senate Goes After Regulators Past, Present

The big Senate Banking committee hearing is underway on Capitol Hill, where Treasury Secretary Henry Paulson, SEC Chairman Chris Cox, Fed Chairman Ben Bernanke and Federal Housing Finance Agency Director Jim Lockhart face a number of angry Senators.

No one on the committee missed the opportunity to:

A) Lash out at Wall Street fat cats and

B) Lash out at Washington regulators who they said let the fat cats get away with their fat cattery.

Committee Chairman Sen. Chris Dodd (D-Conn.) and ranking member Richard Shelby (D-Ala.) opened the hearing by criticizing the proposed bailout and blaming former Fed Chairman Alan Greenspan among others.

Their stinging comments may be echoing those of some Americans who are venting about the Wall Street bailout.

"This plan is stunning in its scope and lack of detail, I might add," Dodd said. "It does nothing in my view to help a single family save a home."

Shelby recalled that he questioned Greenspan in 2003 about the rise in risky mortgages and the fact that more and more homeowners were spending half of their income to maintain their mortgages.

"At this very committee, he said that rising home prices would provide an equity cushion for borrowers," Shelby said.

Oops.

In the first half-hour of trading on Wall Street, trading is up across the board: the Dow is up nearly 80 points, with the Nasdaq and the S&P 500 showing gains, as well.

-- Frank Ahrens

September 23, 2008; 10:06 AM ET  | Category:  business
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Comments

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Isn't Shelby a Republican?

Posted by: around | September 23, 2008 10:24 AM

Yes. He's the same guy who, yesterday, said that it's the business of the board of directors, not Congress, to decide on executive compensation in private companies. Even those that have been bailed out with taxpayer dollars.

Posted by: magpie | September 23, 2008 10:39 AM

Shelby used to be a Democrat. The Republicans can have him.

Posted by: JoeDD3 | September 23, 2008 10:54 AM

Congress is also to blame. Why didn't Congress to something about in the very beginning? Alway waiting until the very last second. That's Congress - those "fat cats".

Posted by: Anonymous | September 23, 2008 11:05 AM

How dare they put out a bail out without safeguards and to not jail the fat cats that caused this!!!
Damit I am Mad!!
Why would anyone vote for McCain one of Bush'es rubber stamp!
Hes a liar and will extend Bush's policys.

Posted by: GHM | September 23, 2008 11:13 AM

Feet, meet fire. Fire, meet feet.

Posted by: T | September 23, 2008 11:15 AM

"Lash out at Washington regulators who they said let the fat cats get away with their fat cattery."

Hard to find anything to smile about in this mess, but this made me smile.

Posted by: pepperjade | September 23, 2008 11:20 AM

The economy is a disaster, the wars have no end in sight, energy is out of control, our briges, schools and infastructure are crumbling, yet no one is responsible? When
does the public begin holding politicians responsible for their actions? C.E.O. and C.F.O. of these investment banks should also face criminal and civil judgements. Now we are told by those who caused the banking nightmare that they can solve the problem, but need government or judicial oversight? When does the revolution begin?

Posted by: Revolutionary 1 | September 23, 2008 12:04 PM

Handshakes. Applause. Self congratulatory gestures. Finally the ovation and closing remarks.

It's a winner.

Posted by: Barbie | September 23, 2008 12:08 PM

Chris Dodd lecturing on fiscal responsibility ... HAHA ... pot calling the kettle black there. Also, why is it Wall Street's fault that people are spending half of their income to pay their mortgage? Excuse me, last time I checked, if you didn't have the money to pay for something, you didn't buy it. That includes a house. Sorry, but anybody that defaults on their mortgage should get evicted and let the bank repo the house - LIKE THEY SHOULD!

Posted by: OldArmy | September 23, 2008 12:31 PM

Couldn't agree more with Old Army. The problem is the government forced the banks to lend to people who did not have the income or assets to pay for the mortgage that they were given. It is time for Sens. Dodd and Schumer to accept some blame because they wanted the "poor" people to own homes. We need to go back to full asset and full income check (and not no income, no asset mortgages. The banks need to require a signficant down payment and not provide 100% or similar financing. It is time for Congress to get real and come to the conclusion that not everybody can own a home. Sorry.

Posted by: Ross | September 23, 2008 12:40 PM

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