The Angelides Commission starting tomorrow is a key moment in the financial crisis. If it turns out to be a Pecora II, it could help force real change on the politicians and their banker patrons.

Much will depend on how the financial press chooses to cover the investigation. Will it focus on the news it makes and deepen our understanding of the crisis? Or will it fall into Politico-style horse-race coverage of which politician is benefiting from “populist” sentiment or which banker looked best hopping out of his Gulfstream?

Since the press is largely reactive by nature, that will depend on the quality of the commission and the amount of news and—let’s face it—drama that come out of its hearings. But the press has a key role in making sure the commission does its job. It can get answers to questions the press cannot since it will have subpoena power and, as Frank Rich put it Sunday, tell “the full story of how Wall Street gamed and inflated the housing bubble, made out like bandits, and then left millions of households in ruin.”

So how can the press help here? Andrew Ross Sorkin’s column in The New York Times is a good place to start.

Sorkin has several questions for the Angelides Commission to ask and they’re all good. Numero uno goes to Goldman Sachs on how it bet against the very CDO’s it was creating and selling to greater fools:

In the process of selling them to institutional investors, however, your firm lobbied ratings agencies to assign them high ratings as solid bets — even as your firm planned on shorting them.

Could you explain how Goldman bet against these C.D.O.’s while simultaneously trying to persuade ratings agencies and investors that they were good investments? Were they designed from the outset to be shorted by Goldman and possibly select clients? And were those clients involved in helping design these transactions? What explicit disclosures did you make to Standard & Poor’s and Moody’s about your plans to short these instruments? And should we continue to allow transactions in which you’re betting against what you’re also selling?

These are all excellent questions and if we’re lucky we’ll get to see Lloyd Blankfein squirm on the hot seat tomorrow on CNN while trying to answer them. And if we’re really lucky we’ll get to see this other Sorkin question put to the Wall Street chieftains:

Again, for the group: Over the last year, your firms have actively used the Federal Reserve’s discount window to exchange various investments (including C.D.O.’s) for cash. You probably have a better idea than most about what those assets now sitting on the Fed’s balance sheet are worth.

Given the growing calls for regular audits of the Fed (an idea being resisted by the likes of the chairman, Ben Bernanke), do you think the demands for such audits are warranted?

That’s not the best question there, but the points behind it are good. What are those CDO’s worth? What’s in them?

Bloomberg is in the middle of a lawsuit against the Fed right now to find that out. It’s nice to see someone else in the press finally bringing the subject up.

Another avenue we’d like looked down is the connection between Wall Street and the toxic mortgages that got made. Who knew what and when did they know it?

The press has a critical role in making sure this commission does its job.


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Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu. Follow him on Twitter at @ryanchittum.