Delaware Senator's Blame Placing a Bit Suspect

Senator Edward Kaufman (D-DE) is on the warpath. The junior senator from the First State wants those who were responsible for the mortgage meltdown and other assorted crashes that neutered the economy to be investigated and jailed if judged guilty. Here's what the good senator had to say:

The Wall Street collapse that precipitated today's economic crisis has many causes, from regulatory failures to recklessness and greed. But before Congress begins to write new rules, we must investigate any crimes that may have been committed, whether by local mortgage brokers or the biggest banks.

Hmmm...mortgage brokers, banks...someone is missing in this list and I can't quite put my finger on who it is. Give me a second or two while we read on and are treated to the stunning intellectual brilliance of Sen. Kaufman:

Let's enforce the laws that were on the books and throw those who broke them in jail.

Good idea and I just remembered who the senator forgot: His fellow senators and congressmen. Chris Dodd, Charles Rangel, Barney Frank, they all were responsible for this mess but the senator neglected to mention them. It must have been an oversight on his part. Okay, what about Franklin Raines, Jamie Gorelick and the rest of the crew who took huge bonuses while simultaneously cooking the books. That's fraud and those laws were on the books so let's throw them in jail as the esteemed senator recommends.

I am not prejudging anyone. We may well find that only a few cases involved outright criminal behavior. And we must take care that our anger does not cloud our judgment.

Nor am I prejudging anyone, Senator. I say we investigate them all starting with Raines and work our way around to "Friend of Angelo" Chris Dodd.

Mortgage brokers may have fraudulently solicited mortgages or engaged in predatory practices.

But, but didn't the government encourage the practice by relaxing regulations? Did not Democrats call the entire idea of auditing Fannie Mae and Freddie Mac an act of racism? Didn't President Bush and Sen. McCain sound the alert on the crisis that was building at both Freddie and Fannie in 2005 when Raines and Gorelick were cooking the books and accepting huge checks?

As the housing bubble burst, banks may have failed to disclose material information as they went from supposedly profitable to insolvent, leaving investors holding the bag.

They probably would have remained solvent had they not given sweetheart loans to congressman who sit on committee's that regulate them. Chris Dodd pops into mind as one who received such a loan.

Attorney General Eric Holder has emphasized that federal law-enforcement officials can understand exactly what happened and investigate the people and firms involved only by "drilling down" into the records of complicated financial transactions. Right now, the resources to do so are not there.

I say we do indeed investigate the people and firms and "drill down" into the records. Let's start with Countrywide and look at who exactly qualified as a "friend of Angelo". They shouldn't be that complicated when it comes to a certain US Senator from the great state of Connecticut. But where to get the resources?

We must dramatically increase the number and training of FBI agents investigating these crimes. Our bill authorizes $155 million a year for the Justice Department to hire fraud prosecutors and investigators in 2010 and 2011. It also provides $65 million a year for 190 additional FBI special agents and more than 200 professionals to fight white-collar crime.

Awesome! All that for only $155 million? Anytime I see a new spending bill that asks for millions instead of billions or trillions it's cause for celebration. I just hope we have $155 million left. If not we can just ask the next three or four Obama nominees to pay up on their past taxes and we'll cover that cost.

Prosecuting bad people won't put an end to all bad behavior. But it will make people in the board rooms, on the trading desks, and in the mortgage industry think twice before they look the other way, put greed over fiduciary duty, or deal from the bottom of the deck. At the end of the day, this is a test of whether we have one justice system in this country or two.

Or three when the House and Senate are added in. But of course, Dodd, Rangel, Geithner and the myriad other Obama cronies are not greedy, just mistake prone evidently.

This is not about vengeance or politics. For our economy to work for all Americans, investors must have confidence in the honesty and transparency of our financial markets. Our economy will flourish only when Americans again trust that everyone is accountable to the law.

Of course it's not about vengeance or politics, heavens no. I mean, Obama is above the fray and his attacks on Rush, Cramer and Santelli are not about vengeance and politics either.

It's true, "our economy will flourish only when Americans again trust that everyone is accountable to the law". that includes members of the House and Senate Mr. Kaufman.