Barney Frank Enmeshed in Financial Crisis
About the Author: I also write under the names Rudi Stettner and Magdeburger Joe. My home websites are rudistettner.com and magdeburgerjoe.com. Through my writing I like to promote a "labour conservative " social outlook as well as my eclectic tastes and interests Read more from this authorBarney Frank, one of the most visible defenders of Democratic innocence and Republican guilt in the recent financial crisis has some explaining to do.
Barney Frank is head of the Financial Services Committee of the House of Representatives. Barney Frank’s Committee oversees Fannie Mae and Freddie Mac, which have been scored for extending loans to unworthy recipients who have defaulted then Since a bank measures its wealth in part by anticipated payments from loans, it is very bad news when a significant percentage of these loans go into default. The very fact that Frank was involved in the oversight of Fannie Mae and Freddie Mac begs further scrutiny.
Unfortunately for America, there is a lot more about Barney Frank that begs further investigation.
According to Fox News, Herb Moses was not only a senior executive at Fannie Mae, he was also Barney Frank’s lover. What is most relevant to the current financial crises is Herb Moses’ position as assistant director for product initiatives, which designed loan programs for offering to the public.
It is normal for a bank to weed out bad credit risks when going through loan applications. There are standards and formulas that facilitate such a process. Being turned down for a mortgage may mean the sinking of a dream, but it can save a lot of heartbreak further down the road.
Herb Moses was a strong advocate of relaxing standards for loan eligibility. He was employed at Fannie Mae from 1991 to 1998.
Why do we care about a stretch of employment that ended ten years ago? If someone were arrested for DUI ten years ago , it would be ancient history. If someone got fired from a job ten years ago, ten years of stability would be enough time to live it down.
Mortgages are a different story. They are a twenty to thirty year commitment. The decisions made at Fannie Mae ten to twenty years ago are bearing fruit today. The standards that were relaxed to facilitate such ill advised decisions were made under the oversight of Frank’s committee at the behest of his lover.
There were certainly other advocates for the ill advised relaxation of loan eligibility standards. The Frank relationship with Moses was not the only set of brush strokes in the big picture. But it was definately an intimate relationship that could reasonably be expected to cloud objectivity.
This relationship is not a fresh discovery. According to Fox News, “Both Frank and Moses assured the Wall Street Journal in 1992 that they took pains to avoid any conflicts of interest. Critics, however, remain skeptical.”
A nest of double standards are operative in media scrutiny of Barney Frank. First, he is a Democrat. Secondly he is gay. The major news outlets are notoriously light on Democrats. And prejudice against homosexuals has been banished from the mainstream of political discourse.
According to Fox News, the rise of new double standards has not come unnoticed.
“It’s absolutely a conflict,” said Dan Gainor, vice president of the Business & Media Institute. “He was voting on Fannie Mae at a time when he was involved with a Fannie Mae executive. How is that not germane?
“If this had been his ex-wife and he was Republican, I would bet every penny I have - or at least what’s not in the stock market - that this would be considered germane,” added Gainor, a T. Boone Pickens Fellow. “But everybody wants to avoid it because he’s gay. It’s the quintessential double standard.”
A top GOP House aide agreed during an interview with Fox news
“C’mon, he writes housing and banking laws and his boyfriend is a top exec at a firm that stands to gain from those laws?” the aide told FOX News. “No media ever takes note? Imagine what would happen if Frank’s political affiliation was R instead of D? Imagine what the media would say if [GOP former] Chairman [Mike] Oxley’s wife or [GOP presidential nominee John] McCain’s wife was a top exec at Fannie for a decade while they wrote the nation’s housing and banking laws.”
Frank met Moses in 1987, when Barney Frank became the first openly gay member of Congress. In an interview in the Washington Post, he boasted of being the first Congressional gay spouse. The two broke up in 1998, soon after Moses left his Fannie Mae position.
Fox News describes the impact of Frank’s measures as follows.
“In 1991, the year Moses was hired by Fannie, the Boston Globe reported that Frank pushed the agency to loosen regulations on mortgages for two- and three-family homes, even though they were defaulting at twice and five times the rate of single homes, respectively.”
Bill Clinton, who was President during the 90’s, attempted to correct the ill conceived regulations back in 1994 through his Department of Housing and Urban Development. Unfortunately for him and the nation, the Clinton administration’s efforts were successfully thwarted by Barney Frank, remaining in force for years after and yielding the bitter fruit of countless foreclosures.
Bill Clinton has clearly put truth and country over partisan loyalty in assigning blame in the current crisis.
“I think the responsibility that the Democrats have may rest more in resisting any efforts by Republicans in the Congress or by me when I was president, to put some standards and tighten up a little on Fannie Mae and Freddie Mac.”Clinton said according to Fox News
The Democratic blame game has cut into the Republican lead in recent polls. The financial crisis is most commonly cited as the reason for this dip in popularity. Barney Frank has been among those leading the charge and in charging the Republicans with resposibility for the current difficulties.
Our troubled economy needs the truth as a preparation for the administration of fitting remedies. This truth needs to come from the Republicans, the Democrats and especially now, Barney Frank.
hNeocon Express on Barney Frank
