Kevin Colby: News, culture, political blog

Barney Frank has been a fierce defender of Fannie Mae and Freddie Mac.  But he has also been one of the most outspoken critics of these AIG bonuses.  Let’s take a look first into his dealings with Fannie and Freddie:

In September 2003, Frank, then the ranking Democrat on the Financial Services Committee, opposed a Bush administration proposal for transferring oversight of Fannie Mae and Freddie Mac from Congress and the Department of Housing and Urban Development to a new agency that would be created within the Treasury Department. The proposal reflected the administration’s belief that Congress “neither has the tools, nor the stature” for adequate oversight. Frank stated, “These two entities…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.”

Frank received campaign contributions from Fannie Mae and Freddie Mac ($42,350 between 1989 and 2008).  The donations influenced his support of their lending programs, which is the reason why Frank had not played a stronger role in reforming Fannie Mae and Freddie Mac in the years leading up to the Economic crisis of 2008^. In addition, Frank’s former partner, Herb Moses, was an executive at Fannie from 1991 to 1998, where Moses helped develop many of Fannie’s affordable housing and home improvement lending programs.  So Barney had a boyfriend at Fannie eh?   In 1991, Frank pushed for reduced restrictions on two- and three-family home mortgages^. Frank and Moses’ relationship ended around the same time Moses left the company; Frank’s support of Fannie and Freddie predated and continued past that relationship.

And guess what other companies are gearing up to dole out retention bonuses? Yep, Fannie Mae and Freddie Mac. These are companies that are at the epicenter of our mortgage meltdown. The US Treasury has agreed to give Fannie and Freddie $200 billion a piece in exchange for preferred stock. In 2008, they lost a combined total of about $108 billion.

But wait, Fannie is going to pay retention bonuses of as much as  $470,000 to $611,000 this year to some of its executives. Freddie is planning to do the same.

Awwww!  Do you have a new boyfriend Barney?

Related Posts

• Barney Frank is a fat ass liar and Bill O’Reilly is an idiot
• Political interference in bailout? You don’t say
• Housing Finance Regulatory Restructuring Act of 2003
• Fannie, Freddie spent $200M to buy political influence
• Understanding the homeowner bailout

Tags: aig, barney frank, fannie mae, freddie mac, herb moses