A Possible Sign Of The Apocalypse

These are words that I have never written--or thought--before and expect never to again: House Republicans are right.

On July 11, House Republicans issued a report on an investigation into the Department of Justice's 2012 settlement with HSBC, the British megabank, for laundering $900 million for the Columbian and Mexican drug cartels and for regimes under international sanctions for nuclear proliferation, genocide and support for terrorism. The DOJ touted the $2 billion civil penalty as a "record," but the penalty amounted to five weeks of profits for the bank taken from shareholder funds. There were no criminal charges.

Lanny Breuer, the Assistant Attorney General for the Criminal Division, and Eric Holder, the Attorney General, both argued that the DOJ could not bring criminal charges because convictions might jeopardize the bank and the stability of the world's financial system. But then Holder said his statement had been "misconstrued."

Holder said "there are a number of factors that we have to take into consideration....Innocent people can be impacted by a prosecution....But let me be very, very, very clear. Banks are not too big to jail." The DOJ would bring criminal charges where there was enough evidence to prove guilt beyond a reasonable doubt.

The congressional report concluded there was ample evidence to prove guilt beyond a reasonable doubt. The decision not to pursue criminal charges was entirely because HSBC was "too big to jail."

Executive branch cooperation in congressional investigations is seldom cheerful, but the DOJ flatly refused to produce any subpoenaed documents. The Department of Treasury grudgingly produced some documents redacted at DOJ's request. The stated reason was that the withheld information pertained to "prosecutorial decisions."

The courts have never precisely defined "executive privilege," the protection of the confidentiality of some discussions about some decisions between some executive branch officials to encourage uninhibited debate. But this much is clear: there is no blanket protection for "prosecutorial deliberations."

There is no government power more susceptible to dangerous abuse or more in need of constant independent scrutiny than the power to bring, or not to bring, criminal charges.

An aggressive Senate investigation exposed the Teapot Dome scandal almost a century ago. The Secretary of the Interior went to prison for taking bribes for no-bid petroleum leases on federal lands. The Senate also examined the Justice Department's failure to investigate and prosecute the people involved.

The Supreme Court upheld the Senate's authority to hold a subpoenaed witness in contempt for refusing to testify on the Justice Department's conduct. The Court said the question whether the Justice Department's "functions were being properly discharged or being neglected or misdirected...concerned a subject on which legislation could be had and would be materially aided by the information which the investigation was calculated to elicit."

A decade ago the Bush Administration fired federal prosecutors who had brought prosecutions that hurt Republicans or failed to bring flimsy prosecutions that would hurt Democrats. Administration officials refused to comply with House subpoenas and the House went to court. The court rejected the Administration's argument that the decision to fire prosecutors was entirely up to the President and none of Congress's business. Congress had a "unique ability to address improper partisan influence in the prosecutorial process," the court said, and "[n]o other institution will fill the vacuum if Congress is unable to investigate and respond to this evil."

There is no evidence that DOJ's decision to settle with HSBC was criminally corrupt or the product of improper partisan influence. Wall Street critics hotly dispute that criminal prosecution of HSBC executives would have threatened the financial system, but DOJ's decision to settle was likely based on that concern, as Breuer and Holder first said. The obvious injustice is deeply offensive to most Americans.

Savvy Washington insiders avoid public debate with Wall Street critics, so some political functionary told Holder that he was off message.

House Republicans' concern for the injustice of the settlement is patently insincere. House Republicans' only motive is to embarrass the Obama Administration, not to side with Wall Street critics.

Certainly the investigation could inform legislation. Most obviously, any institution that seeks the special treatment that HSBC received should immediately be broken into small-enough-to-jail pieces. That is legislation House Republicans will never enact.

But political embarrassment punishes misconduct, including the misconduct of staying on a message that deviates from the unvarnished truth. Americans are entitled to know how the power they confer by their ballots is used. And Americans are entitled to know if some powerful financial institutions receive special treatment in the criminal justice system.

A great American political scientist, Woodrow Wilson, wrote in 1885 that the "proper duty of a representative body [is] to look diligently into every affair of government and to talk much about what it sees...The informing function of Congress is to be preferred even to its legislative function."

If congressional oversight causes political functionaries to hesitate to tell presidential appointees to stay on messages that are varnished versions of the truth out of fear of embarrassment, then that would be a wholesome result.