October 1, 2008
Wrecks, Lies and Barney Frank
Democrats have a lot to hide about their role in creating the current financial crisis and are doing their best to appear blameless with charges directed elsewhere.
Within hours of the fall of their affirmative-action-lending-policies house-of-cards, they rose united to wag accusing fingers at Wall-Street greed and the failures of an unregulated free market. And even as new transcripts and videos surface daily revealing an irrefutable connect to a decades-old liberal push to increase availability of home mortgages to high-risk minority borrowers, the counterfeit clarion call against "predatory" capitalism continues. This fraudulent tactic is meant to not only exonerate accountable Democrats -- and one Massachusetts congressman particularly -- but to provide them cover to insist the same quixotic liberalism fueling the problem be included in any government-sanctioned solution.
Did you notice that during Monday's debate over H.R. 3997, the failed Emergency Economic Stabilization Act of 2008, Democrats spoke often of strengthening both regulation and oversight, yet mentioned nothing of illiquid debt, government coerced or not? Or that some, including the House Speaker, promised the guilty will ultimately suffer the wrath of House Oversight and Government Reform Committee chairman Henry Waxman? How about the incongruity of those crying for justice and then thanking Barney Frank for reputedly making workable a bill originally delivered to him otherwise? Even Pelosi's obscenely partisan post-debate speech, which may have hammered the final nail into the Bill's coffin with its inopportune and wrath-filled Bush and Wall Street bashing, included a salute to the "extraordinary leadership" of the Massachusetts Democrat she was about to throw under the bus.
This was politics at its very worst, softening the blow they were about to strike against the Bush-backed Bill its House Democrat champion had all but staked his reputation on, while simultaneously spreading the same fertilizer Frank is using to rewrite his (and, of course, his party's) culpability engraved within the debacle's history. And Frank is spreading it wherever, whenever and however he can.
Indeed, the list of blameworthy Democrats is long and distinguished. However, Frank's recent thin-skinned written and spoken admonishments to those daring to confront previous related actions and statements betray a man whose hands may be deeper into this fiasco than any other sitting politician's.
Barney and Friends
As prelude to Monday's vote, Barney appeared on C-SPAN's Washington Journal Sunday morning purportedly to discuss the modified Bill. For a while, he actually managed to remain on point.
But then a caller challenged Frank's continued insistence that the meltdown was brought on by Republican deregulation, citing the 1999 NY Times article concerning Clinton Administration efforts to force Fannie to ease mortgage standards in order to provide more minority and lower-income lending. The caller reminded Barney of his own words as ranking member from a 2003 Times piece reporting Bush's initiative to reign in Fannie and Freddie by creating new oversight under the Treasury Department:
''These two entities -- Fannie Mae and Freddie Mac -- are not facing any kind of financial crisis. The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.''
Recognizing the now-familiar accusation that he supported bad loans for the advancement of minority home ownership, Frank flew into a rambling tirade, blaming a right-wing-blogger conspiracy working to wrongly paint the good guy Democrats as the bad guys. As advocates of complete deregulation, he roared, "the Conservatives were very embarrassed." Adding that the "right-wingers" had left out that:
"Republicans were in control of the Congress from 1995 until 2006. They got a lot through -- they got the Iraq war through; they got the Patriot Act through; they got tax cuts for the wealthy, a prescription drug program ..... But in twelve years, they never got a bill through the Congress to tighten up the regulation of Fannie Mae and Freddy Mac.
"I became chairman of the committee that has jurisdiction in February of 2007. Within two months, the committee had passed a bill that did all of the increased regulation that the Bush Administration ever wanted. I was a supporter of the regulation, but the Bush Administration couldn't get it through Congress. When the Democrats took over Congress, we passed exactly that regulation, and while the Senate didn't do it until July of this year, here's the record: Twelve years of Republican control, no legislation to increase the regulation of Fannie Mae and Freddy Mac. Nineteen months of the Democrats, and we have done it."
That's been Frank's stock response whenever his glaring complicity is underscored, be it in the blogosphere or by the few news agencies willing to hold his feet to the fire [Must see Fox News Video].
You've likely already heard it a dozen times or more.
But you may not have heard that last week, Rep. Michele Bachmann (R-Minn) wrote an op-ed for her state's Star Tribune, also blaming misguided liberal policies for the mess:
"The recklessness of government is a primary culprit here. For years, Congress has been pushing banks to make risky, subprime loans. Using the authority of the Community Reinvestment Act, the big push for subprime mortgages began in earnest during the Clinton years. Banks that didn't play ball were subject to serious fines and lawsuits, and regulatory obstacles were placed in their way. While expanding access to the American Dream is a worthy goal, by blindly pursuing that goal and allowing the end to justify any means, we put millions of Americans at financial risk."
She then went on to specifically blame Congressional leaders, singling out her own committee chairman, Barney Frank, who "resisted reforming Fannie and Freddie at every turn."
Frank somehow found time in his busy schedule to submit a rebuttal to Bachmann's words, claiming in its title that Republicans set the table for this crisis and again insisting:
"The truth is that the Republicans failed in every year of their 12-year hold on Congress to create a strong, independent regulator to oversee Fannie and Freddie. And despite their rhetoric, the Bush administration also failed to enact strong regulation in the first seven years of its tenure."
I repeat -- Barney has sung this same tune virtually every time in the past few weeks he found an audience willing to listen.
But the congressman's continual karaoke resonates painfully off key.
Let's be perfectly Frank
In truth, the Bill that would have likely averted the Fannie/Freddy failure -- the Federal Housing Enterprise Regulatory Reform Act of 2005 (S. 190) -- was Republican legislation introduced by Sen. Charles Hagel [R-NE] in January of 2005. And it was the Democrats who opposed it in committee, fearing that its restrictions and portfolio caps might impair mortgage market liquidity, and subsequently, affordable housing. Despite the "nay" votes of all 9 Democrats on the Senate Committee on Banking, Housing, and Urban Affairs, the bill moved to the Senate floor, where it died in limbo lacking a filibuster-proof majority. The Bill was reintroduced in the 110th Congress as S. 1100, but was kept on ice by committee chairman Chris Dodd, who, coincidently, received $133,900 in grease from Fannie and Freddie over the past decade.
What's more, the "regulation" Frank now takes credit for was not his (H.R.1427 passed the House last year but never escaped Senate committee) but rather Nancy Pelosi's (H.R. 3221 - The Housing and Economic Recovery Act of 2008). And Pelosi's version, not surprisingly and unlike its Republican predecessors, was signed marked up with over 66 pages of Liberal wealth redistribution wish-fulfillment under the guise of assuring "affordable housing." While it did establish (and way too late, Barney) the Federal Housing Finance Agency, with regulatory authority over Fannie Mae, Freddie Mac, the Federal Home Loan Banks, and the Office of Finance, it's bogged down with tons of pork-fat. This oinker even increased the national debt limit from $9.82 trillion to $10.62 trillion, and commissioned a boatload of programs for low income families to spend it on.
Frank did, however, introduce legislation of his own in October of last year. Would you believe that H.R. 3838 was actually an attempt to temporarily increase the caps on Fannie/Freddie portfolios and to mandate the "use of 85% of such increase for refinancing subprime mortgages at risk of foreclosure?"
Funny how the congressman neglected to mention that when he assured another C-SPAN caller that:
"Yes, I did want to help affordable housing, but I also wanted to prevent bad loans."
Simply hilarious, especially considering the joyous September 18th 2007 announcement on the congressman's own website that Maxine Waters' H.R.1852 had passed the House. As proudly emphasized by co-sponsor Frank at the time, the Bill authorized "zero and lower down payment loans for borrowers that can afford mortgage payments, but lack the cash for a required down payment." It also "more than doubled" funding to counsel "subprime homebuyers and borrowers late on mortgage loan payments" and directed the FHA "to provide mortgage loans to higher risk (but qualified) borrowers, without authorizing unnecessary fee hikes on such borrowers." It also raised "FHA single family loan limits, which now bar loans above 95% of the median home price in each local area and shut FHA out of higher cost home markets."
That was last year. Four years after the Bush Administration had sounded the alarm. Yet, shortly after his C-SPAN appearance last Sunday, Frank responded to the Boston Herald questioning his awful projections of half a decade ago with "in 2003, nobody that I knew of foresaw the crisis of subprime lending, and that is what caused this problem."
Does anybody really believe that the chairman of Financial Services somehow fails to understand the ingredients of the bad loans that have created all of the toxic paper at the root of this problem?
Frankly My Dear, They Don't Give a Damn (Unless, Of Course, You're Destitute)
The Democrats' campaign to sully the President and Conservative fiscal policies is a childish ruse to shield their own failed politically correct credit ideology. And their shockingly deceitful insistence that it was they who foresaw peril and championed regulation is equally sophomoric.
Yet without acceptance, there can be no transcendence.
Not only was their so-called "regulation" Bill loaded with the same irresponsible disregard for reality that created the need to regulate in the first place, but they continue to inject their disastrous PC claptrap into all attempts to remedy the nightmare they have created.
On September 9th, The Wall Street Journal pointed out that when asked about the bailout condition which would force Fannie/Freddie to "reduce the size of their high-risk mortgage-backed securities portfolios starting in 2010," Frank responded "‘Good luck on that,' and that it would never happen." The Journal also reported that Frank had coerced the creation of an "affordable housing" trust fund in backing the bailout, stating that:
"This fund siphons off a portion of Fannie and Freddie profits -- as much as $500 million a year each -- to a fund that politicians can then disburse to their favorite special interests."
Frank took issue and again found time to submit a rebuttal, again taking bizarre bows for July's too-little-too-late legislation, and referred to WSJ writers as "right-wing ideologues" who believe that "funding to build affordable residential housing is ‘loot.'"
Of course, he's not the only left-wing-nutjob in town that just doesn't get that some people simply do not earn enough to be homeowners - precisely the reason rentals exist.
On Tuesday morning's Morning Joe on MSNBC, Majority Whip Jim Clyburn (D-SC) announced that the Congressional Black Caucus voted against the measure largely because it didn't include bankruptcy protection for homeowners. The CBC backs a fantasy-land proposal that would allow bankruptcy judges to unilaterally restructure home mortgages for those facing bankruptcy.
During Pelosi's poison-Bill speech on Monday, she blamed "failed economic policies -- policies built on budgetary recklessness, on an anything goes mentality, with no regulation, no supervision, and no discipline in the system." Actually, the Speaker was right on the money describing the policies that precipitated this credit wreck.
But she couldn't have been more wrong in her choice of targets at which to aim her rage.
Marc Sheppard is a frequent contributor to American Thinker and welcomes your comments.