Barney Frank Breaks Out Smoke,
Mirrors, and Mirrored Truth
“The devil,” it’s said, “can quote scripture for his own purposes.” Certainly it seems that the devilishly clever and resourceful Barney Frank has discovered that a bit of truth can serve to obscure greater truth and as a very useful red herring against minor-league journalistic entitites.
Once you get past Obama, Pelosi and Reid . . . the “top-flight nincompoops” . . . a huge number of progressive lesser nitwits come into focus. Among these lesser lights, Barney Frank has long been distinguished for his extreme ideological nitwiticity. Frank, Democratic Chairman of the Financial Services Committee, as recently as September, 2008, was telling anyone who’d listen that Fannie Mae and Freddie Mac were “in great shape.” Frank was infamous for saying, “Oh, look, the private sector has brought the country down again, here comes government to rescue them . . . again” and seeming far more interested in marijuana and gay rights than actually understanding the ins and outs of the influential House committee he chairs.
But now Frank has come, however, to an epiphany. In a recent interview on CNBC, Frank said, "I hope by next year we'll have abolished Fannie and Freddie, it was a great mistake to push lower-income people into housing they couldn't afford and couldn't really handle once they had it." He continued "I had been too sanguine about Fannie and Freddie." Behind his weasel word “sanguine” lies the truth. Frank hadn’t just been extremely optimistic about the status of Freddie and Fannie, the two government funded mortgage giants, he had been covering up his own incompetence and deliberately lying to the American people about the causes of the sub-prime lending crisis and the ensuing financial collapse.
In the interview Frank discussed a long-term plan to shrink Fannie and Freddie portfolios and merge the agencies into the Federal Housing Administration (FHA). Frank also said federal housing guarantees should be transparently priced and made fiscally sound, but that the private sector must be encouraged to re-enter housing finance just as the government gradually withdraws from it. If ever an “ooops, I goofed” seemed politically-timed and save-my-own-butt motivated, Frankie’s “I done wrong” is the ultimate in political chicanery. Among the hardball questions that interviewer Lawrence Kudlow refused to put to Frank is this one, “Since the latest bailout the country’s faced with is the likely $400 Billion rescue of Fann-Fred and since those two entities are loathed by the taxpayers, Mr. Frank, isn’t this sudden shift just a cynical ploy aimed to ingratiate yourself with the voters one more time?”
If Kudlow had played hardball, one can imagine the Representatives response, “Actually, the rescue would take $150 Billion . . . ONLY . . .” ignoring the latest Congressional Budget Office’s projections. Kudlow’s follow-up question should have then been . . . “You do realize, Sir, that those two failed agencies had to borrow $1.5 Billion from the Treasury Dept. to pay off the dividends of $1.8 Billion to the very same Treasury Dept., in any case do you approve of or disapprove of President Obama’s giving $42 million in bonuses to the top dozen Fannie and Freddie executives with $6 million apiece to their two top administrators? Shouldn't bonuses be reserved for people who do good jobs?”
Kudlow, just doesn’t get it. In a follow-up article to his interview with Frank, he excused Frank and said “I think he has come to realize that the whole system of federal affordable-housing mandates that was central to the real-estate collapse -- including the mandates on Fannie and Freddie and the myriad bad decisions made by private banks and other lenders in response to the government's overreach -- simply needs to be abolished.”
How naïve and self-serving can one politician and one reporter get? Except, of course, whatever else he is, Barney Frank is NOT naïve, he knows what plays in Peoria or Roxbury or wherever. Mr. Chairman and Mr. Kudlow, those “myriad bad decisions made by private banks and other lenders” were forced upon them by the Community Reinvestment Act of 1977 and its four expansions (in ’92 Fannie and Freddie were included; and then Bill Clinton presided over three more expansions – twice in ’95 and the steroid version in ’98) that took the best housing system in the world and made it insolvent. From 1946 to 1992 America’s 62-65% private home ownership rate was the envy of the world. The system was NOT broken although the progressives were mightily trying to ruin it under Cloward-Piven, ACORN and CRA ’77. As ACORN perfected the art of shaking-down lenders the percentage of closings with 3% or less downpayment went from less than ¼% in 1975; to less than ½% in 1985; to 14% in 1995 with Freddie and Fannie involved; to 34% in 2005 on Clinton’s steroid version of mortgage-guarantee legislation.
Also unstated by Mr. Frank: Barack Obama’s role** as an ACORN lawyer between 1994 and 1997 shaking down those besieged lenders trying mightily to avoid giving in to demands for bad loans required by the government’s laws. If ever there was a series of government interference laws designed to bring down this country and its great economic system, these were the laws.
And Mr. Kudlow could never be expected to research back into Richard Cloward and Frances Piven. Those two Columbia University (NYC) leftist profs published their 1966 article on the Cloward-Piven Strategy and then joined with George Wiley in bankrupting New York City (between 1967 and 1975 after creating Wiley’s National Welfare Rights Organization) and almost bankrupting New York State. Their goal? To force the country, more particularly the Democratic Party to institute NGI (a national guaranteed income program). While publicly bragging about their great accomplishment, Cloward and Piven expressed little regrets that they didn’t actually get NGI, but looked to the future and said their followers should “get involved with housing and voter registration.”
Accordingly when Jimmy Carter and his progressives passed CRA ’77, George Wiley sent his lieutenant Wade Rathke to Arkansas to create ACORN that same year. The “A” in ACORN in those days stood for “Arkansas” but later came to mean “Association” as the group expanded to all 50 states. Why Arkansas, because an up and coming politician there very sympathetic to their ends (his wife had done her honors thesis on Saul Alinsky) had been elected Attorney General there in 1976 at the age of 30. From that point on the fortunes of Bill Clinton and ACORN were tightly intertwined as he became the first ACORN president. Besides the three mortgage-guarantee expansions Clinton made, he also signed the Motor Voter Act into law in 1993 with Cloward and Piven both standing behind him in the infamous picture all over the internet. Clinton had answered the Cloward-Piven call for action in housing and in voter registration in SPADES. Mr. Frank, himself as ugly a progressive as ever lived, is just buying time with his insincere little mea culpa while continuing to hide all the salient little details hiding the progressive/communist agenda to destroy capitalism and this country so that ultra-socialism can prevail.
Of more interest is the fact that Treasury Secretary Tim Geithner has come to a similar conclusion as Kudlow says Frank has made. Geithner told a recent Washington conference on the future of housing finance that the system needs fundamental change. He said, "We will not support a return to the system where private gains are subsidized by taxpayer losses." Geithner also praised George W. Bush’s 2007 legislation** which according to Geithner greatly moderated the recession and kept housing prices from undergoing a complete swoon. The story behind that little fact is also one Mr. Frank would prefer you and I not discover.
In November, 2003, investment advisor James Stack of investech.com started publishing a “Housing Industry Bubble” chart he’d maintain on his website for almost five consecutive years. According to Stack while home prices had surged, the prices of stocks involved in the housing industry had risen 1200% (they would go up more, up to a 1300% rise hitting 1400% of their 1997 values) and while this was a very dangerous bubble sure to pop, the underpinnings of both the housing price increases and the stock market surge for the housing industry was an unsustainable sub-prime lending situation. Bush and his administration came to the same conclusion in January, 2005, and sought to pass a law removing all the teeth from Clinton’s ’98 steroid version of mortgage-guarantee expansion. The Democrats and some progressive Republicans stopped him cold. By July, 2007, even the blind congress could see what was happening and they passed a watered-down version of Bush’s 2005 effort. That law is the reason that Geithner praised Bush. By the way, so far Barack Obama has not actually officially fired anyone. Geithner’s burst of recent truth-discoveries may soon change that, Rajjpuut suggests that Tim Geithner is not long for the Obama administration (praise George W. Bush, oh my God!) if he continues to shoot off his mouth with truthful utterances.
In any case, Kudlow, did not miss some of the implications. In his follow-up article he said, “The broader lesson here is that government planning doesn't work. And if left to their own devices, market processes will work.” He then concluded, “I don't know if President Obama gets this. But my hat goes off to a man who does, Chairman Barney Frank.” Ah well, you CAN fool some of the people all of the time, can’t you Barney?”
Ya’all live long, strong and ornery,
** it seems, Mr. Obama, that you drove the car into the ditch deliberately and Mr. Bush brought a tow-truck along
^^ Didn't anyone in our government notice that after Clinton's '98 mortgage-guarantee expansion, ACORN was shaking-down lenders to comply with the new law so that folks without ID; folks without jobs; folks with outrageously bad credit scores; folks listing food stamps as income; other folks on welfare; folks without even a rental history; and even illegal aliens could qualify for $300,000 and more expensive homes?