"Financial Crisis Report: Democratic View"

MICHELE NORRIS, Host:

Now, to the commission's Democratic chairman, Phil Angelides.

Mr. Angelides, welcome back to the program.

PHIL ANGELIDES: It's always good to be with you.

NORRIS: Now, one thing I have to ask you since when we began this process we talked to you and Bill Thomas together and you had talked about bipartisanship in that moment. How is it that at the end of this process, there is so much dissent: two separate reports, two very different views of history?

ANGELIDES: Here's what I would say. If you look at the report we issued, it is a fact-based report. Of the 500-and-some pages, 490 pages are the actual evidence of the events that occurred in this financial crisis.

If there is a division here, I think it's a pretty fundamental one, and that is that the majority that adopted the commission's report came to the conclusion that this crisis was avoidable.

It was the result of human actions, inactions and misjudgments. And I will say that the dissent did indicate that they found areas of agreement with the majority's conclusions, but we do separate on the issue of avoidability. We don't think this needed to happen.

NORRIS: In your news conference this morning, you sidestepped an important matter, the matter of criminal prosecutions. Can't you at least give us some sense of how many criminal referrals you made to prosecutors?

ANGELIDES: So first of all take into account we are not a prosecutorial body. But we were charged by the law with if we found potential violations of law, we were to refer those matters to the attorney general or the appropriate state attorney general.

And I will just say on this matter that we did our duty. And as a matter of judicial fairness, it is now in the hands of prosecutors to determine whether any laws have been broken.

NORRIS: How many referrals did you make?

ANGELIDES: I really can't comment on that. It really is something that has to be handled with the utmost of judiciousness and fairness.

NORRIS: The folks who have written the dissent say that your report and its conclusions are oversimplifying the problem and the causes of the financial meltdown.

They say that you have to take into account what was going on globally, that there was too much cheap money, much of it coming from Asia, and that other countries were also experiencing a housing bubble, and that should be - and that that should be taken into account in trying to understand what happened in this country.

ANGELIDES: And we did do that. If you look at the report, we did examine international capital flows. We examined foreign investment in this country. We examined how defective subprime securities were exported from the U.S. to European banks.

But we also came to the conclusion that just because you have a lot of money in the system doesn't mean you're doomed to have a crisis. But we also don't take the view that we're just fated to have happen in this country what will happen. I mean, that's a view that essentially dooms us to a repeat of the crisis.

NORRIS: Mr. Angelides, Congress has already passed the Dodd-Frank Bill to overhaul financial regulation. As detailed and specific as this report is, don't you worry that it's arriving a bit too late to have any kind of effect on the political debate or on policy?

ANGELIDES: Well, I believe there's a conscious effort right now to, in a sense, rewrite history, to take a - to view this as a bump in the road, or the quote-unquote "stuff happens" theory. I think our report, as it turns out, will be very timely.

The financial system in this country is almost unchanged from the eve of the crisis. In the 1930s, it took a decade to reform our financial system. This nation has just begun its examination of what went wrong, and I hope that our report is not the last word. And I hope that our report is looked at by the president, by the Congress, by regulators in determining what more needs to be done and what needs to be done to implement the laws that are on the books.

NORRIS: Mr. Angelides, thank you very much for speaking with us.

ANGELIDES: Thank you very much, Michele.

NORRIS: Phil Angelides is the Democratic chairman of the Financial Crisis Inquiry Commission.