Inquiry Panel's Head Is Known as a Scrapper

By NEIL KING JR.

Phil Angelides, head of the commission digging into causes of the 2008 financial crisis, has a reputation as a political pit bull.

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Goldman Sachs CEO Lloyd Blankfein, JPMorgan Chase CEO James Dimon, Morgan Stanley Chairman John Mack and Bank of America CEO Brian Moynihan are sworn in Wednesday at the Financial Crisis Inquiry Commission.

During his eight-year tenure as California treasurer, he used the state's huge public pension funds to force shake-ups on corporate boards. He joined with New York and other states in pushing for caps on executive pay and pressuring companies to make more socially responsible decisions. He led a movement to divest from firms doing business in Sudan and other countries with questionable human-rights records.

Former political aides describe him as hypercompetitive. In the heat of a losing campaign to unseat California Gov. Arnold Schwarzenegger in 2006, Mr. Angelides boasted of "knocking back a 12-year-old" during an impromptu air-hockey game.

"He is tenacious, cubed," said Barbara O'Connor, a political expert at the California State University at Sacramento, where the 56-year-old Mr. Angelides grew up in the 1950s and '60s. "And his interpersonal style is not exactly warm and fuzzy."

A lifelong Democrat, Mr. Angelides says he wants to use his perch on the commission to compile the ultimate history of the financial crisis, much as the 9/11 Commission did in the wake of the Sept. 11, 2001, terrorist attacks. The panel must deliver a final report by December.

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Lloyd Blankfein: "What we do is risk management."

Mr. Angelides says he wants "to shed light, not heat," but he also wants to channel public outrage over Wall Street practices. The nation's top bankers, he says, have yet to fully acknowledge—much less atone for—actions that helped precipitate the crisis.

"I am troubled by the inability to take responsibility, because I think it's fundamental," he said after Wednesday's hearing, which brought together the heads of the largest U.S. banks. "It's important there be a self examination, and I think we're well short of that at this moment."

In a November speech, Mr. Angelides said his ambition was "to unveil what happened so that Americans can have a clear understanding of history, so we do not repeat it."

He noted that after the 1929 stock-market crash, "people were throwing themselves out of windows on Wall Street." But now, he said, "they're lining up for bonuses."

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Phil Angelides: "... It sounds to me a little bit like selling a car with faulty brakes and then buying an insurance policy on the buyer of those cars."

Since he arrived in Washington last summer, Mr. Angelides has reached out to conservatives and hunkered down studying the successes and failings of past commissions, including the Pecora Commission that examined Wall Street abuses in the early 1930s.

"He's asked me to come over a couple of times, just to talk," said Norm Ornstein, a political scholar at the conservative American Enterprise Institute in Washington. "It's clear he didn't come into this naively, or with his eyes closed."

Mr. Ornstein predicts the panel will aim to draft a compelling narrative of the crisis and make proposals for reforms.

While Mr. Angelides promises to act as a sort of historian when the panel completes its assessment in December, he sounded more like a cop at times on Wednesday.

"We'll follow the evidence wherever it leads," he said in opening the hearing. "We'll use our subpoena power as needed. And if we find wrongdoing, we will refer it to the proper authorities."

Write to Neil King Jr. at neil.king@wsj.com

Corrections & Amplifications
Barbara O'Connor is a professor at the California State University at Sacramento. A previous version of this story misidentified the institution as the University of California at Sacramento.