Skip to comments.Better not bank on Barney Frank - He brought the (fiscal) house down
Posted on 09/23/2008 11:12:18 AM PDT by Iron Munro
I want [Freddie Mac and Fannie Mae] to help with affordable housing, to help low-income families get loans and to help clean up this subprime mess. Otherwise, why should they exist?
- Rep. Barney Frank, earlier this month.
The Subprime Panic of 08 and its $1 trillion (and rising!) price tag is too big to blame on any one man. But if we had to, it would be Newtons own Rep. Barney Frank.
As Winston Churchill might have put it, never before has one man done so much that was so wrong, or shafted so many on behalf of so few.
Entire business sections of newspapers, including this one, have been dedicated to explaining how we got into this mess, and still the typical taxpayer is asking So what happened?
The answer is actually quite simple: Freddie and Fannie happened. And they couldnt have without the ferocious support of Barney Frank.
Freddie and Fannie were supposed to be safe suppliers of mortgage money for relatively low-risk loans. If you could qualify for a loan, F&F would make sure the banks had access to the money to make that loan, cheap money because it was backed by the American taxpayers.
But liberals like Barney Frank wanted more. They wanted the low cost of low-risk loans to be extended to higher-risk borrowers with lower incomes, fewer assets or less-solid credit. Barney and friends used the regulations of the Community Reinvestment Act to threaten lenders into making these loans. And banks, trying to meet Franks demands, expanded riskier lending schemes like subprime mortgages.
Thats when Freddie and Fannie stepped in. As Kevin Hassett of the American Enterprise Institute put it: They fueled Wall Streets efforts to securitize subprime loans by becoming the primary customer of all AAA-rated subprime-mortgage pools.
Lenders asked themselves, why should I care how shaky these borrowers are or risky the loans if a government-backed body is going to buy them up anyway?
The loans were made, the housing market bubbled, contributions from F&F flowed to Democrats like Chris Dodd and Barack Obama, and everyone was happy. Until they werent.
Without Freddie and Fannies reckless expansion, the housing bubble doesnt happen. Without the implied promise behind F&Fs money, investment banks dont dive into the derivatives market.
Instead, we did it Barneys way.
Not only has Frank spent his career stopping any real reform of Fannie and Freddie, he repeatedly insisted they werent backed by the taxpayers. There is no federal liability whatsoever, Frank said in 2000.
But two weeks ago, we had to bail them out with $200 billion in our tax dollars.
Alan Greenspan, John McCain and others warned that F&F were taking on too much risk, but Frank dismissed these overblown fears as ideological attacks against his favorite cash cow. Even after Franklin Raines and Joe Johnson were caught red-handed mismanaging these institutions, Frank still insisted we are not facing any kind of crisis.
Just how deep in the Fannie/Freddie tank was he? As The Wall Street Journal reports: Mr. Frank was publicly arguing for an increase in the size of their combined $1.4 trillion portfolios right up to the day they were bailed out. Even now . . . he opposes Treasurys planned reduction in the size of the portfolios starting in 2010.
Our markets have collapsed, were paying through the nose, and Barney Frank is still fighting to keep Fannie and Freddie on the dole.
Why? Because in his mind, the point of Fannie/Freddie is taxpayer-subsidized housing for low-income borrowers - no matter how bad their credit or how high the cost.
Otherwise, he asks, why should they exist?
And what about us, the responsible borrowers and hard-working taxpayers stuck with the trillion-dollar tab? In Barneys world, thats the only reason we exist. He spends. We pay.
This truly is Barney Franks bailout.
Two thirds of the people believe republicans are responsible for the meltdown and the major media likes it that way.
I am always disappointed and amazed at how ineffectual republicans are at defending themselves with the truth during times of crisis like this.
Of course, it would have helped if the President had explained the reason for the meltdown and identified the culprits when he made the case for the bailout.
As it is, people think the bailout is the President's plan so the problem must be something the president and republicans created.
And John McCain has decided to blame the crisis on greed instead of mentioning congressional culpability. So democrats and their media pals have an open field to divert blame from the very people who created the mess.
Since Rep. Barney Frank bears so much of the responsibility for this mess, I think it is only fair that HE be asked to raise some of the money needed for the bail-out.
He REALLY needs to “think outside the box” and come up with some some truly unique fund raising ideas.
Something like, oh, I don’t know... running a male prostitution ring out of his town-house in D.C., say...
WHAT? You say he’s ALREADY done that before?
Oh well, back to the drawing board...
Frank and his others are proud of the fact this was done by them. And why Bush isn’t pointing this out amazes me.
Where is the DOJ on this?
Why is Bush and Republicans not exposing them?
Easy to answer, they are in league with the takeover.
With apologies to Martha Reeves & the Vandellas
Freddie, Freddie, oh Freddie Mack, when are you coming back?
Freddie, Freddie, oh Freddie Mack, when are you coming back?
My arms are missing you, my lips feel the same way too
I tried so hard to be true, like I promised I’d do
But this boy keeps coming around, he’s trying to wear my resistance down
Hey Freddie, Freddie, oh Freddie Mack, when are you coming back
Freddie, Freddie, oh Freddie Mack, when are you coming back
He calls me on the phone, about three times a day
Now my heart’s just listening to what he has to say
But this loneliness that I have within keeps reaching out to be his friend
Need your loving, need your loving
I wanna say, I’m not getting any stronger, I can’t hold out very much longer
Trying hard to be true, but Freddie, he talks just as sweet as you
Need your loving, need your loving
Need your loving, need your loving...
(Freddie, Freddie, oh Freddie Mack, when are you coming back)
I will never understand why the “constituents” of such as the likes of Bawney Fwank, Nancy Pelosi, Chuckie Schumer, Chris Dodd, etc., keep on installing these people time after time, for life, inflicting them on the rest of us - and themselves. - For some reason, Republicans just don’t seem capable of defending themselves from the blatant Democrat lies. - Believe me, IF there were a single Republican that the Democrats could blame for this Fannie/Freddie mess, they would have that Republican tied up in hearings and prison for the next ten years if there were a chance of ruining one more Republican. - I hope Rush Limbaugh will write a book ‘splaining the mess and naming the DEMOCRAT ROGUE’S GALLERY responsible for it and how.
Yeah, sure, blame it on the gay guy. Frank’s experiences as Madam of his basement brothel make him one of the few Democratic Congressmen with a business history. If Democrats don’t put him in charge of overseeing our financial welfare, then who?
..... then who ?
Chris Dodd ,,,,,, he’s a natural .
Don’t ask me if this is true, because I don’t know. Anyway, last Saturday, one of our local radio talkers, who ran for the House and lost years ago, claimed he knows some Beltway insiders. They told him this is going to end up costing a Trillion apiece, for Fannie and Freddie alone. I hope that is not right.
I am sick to death of hearing the talking heads say that we have to do everything possible to help those who are in danger of losing their homes. When will someone, anyone give some credit to those of us who quietly pay our taxes and our mortgages? And now we have to pay off the trillion dollar bail out!
I'd call that a devastating "oversight," to say the least!!!
Anything proactive that would truly be oversight would be considered an opportunity for a political opponent to use against the Congressman.
First off I’d like to know why we can’t just implement Newt’s plan for dealing with this (end mark-to-market , end Sarbanes-Oxley , Drill-Now to end the $$$ hemmorage on energy) and on top of that make it clear that insurers such as AIG will not be held liable for policies written on Mortgage Backed Securities as they were mis-represented to them... Why give the euroweenies any way to claim my wages .. I had nothing to do with this and I couldn’t care less if a new crop of investment banks take over ,, to me it’s just a name change.
That could leave them open to a huge oversight, like they overlooked Fannie & Freddie. What an oversight that was!!!
This is why he can't even get the approval of his own party.
“This is why he can’t even get the approval of his own party. “
Because I can’t believe he isn’t demanding an investigation, oh wait, he can order and investigation.
Why isn’t he demanding the repeal of the laws that brought this mess into being to begin with?
I’m a conservative, on the cusp of Libertarian, Bush is not a conservative.
A conservative would never ever propose such a massive government takeover.
I don’t know what party Bush is in but it isn’t the party I belong to.
Only Kool-aid drinkers support someone no matter what they do.
Screw Bush and Paulson.
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