I Wonder What They're Talking About

Scaife's braintrust, I mean.

In one of today's editorials, they contrast the conviction of hedge fund billionaire Raj Rajaratnam (11 years, $64 million in fines) with "another class of cheats" namely:

We're speaking of economic cheats, those who think they can defy the fundamental rules of economics in pursuit of "social justice." Democrat members of Congress come to mind, specifically those whose legislation was directly responsible for sowing the seeds of The Great Recession.

Think of the bubble-creating/bubble-bursting federal mandates that forced lenders to flood the housing market with easy money for those who had quite little or actually no financial wherewithal.

The "Occupy Wall Street" types can blame "greedy bankers" for subprime mortgages all they want. But unless they recognize government's role in the mess -- and direct their protests accordingly -- their entreaties for an economic "re-set" will devolve into just more "progressive" chants for more free lunches.

Of course, they're talking about the immensely powerful Barney Frank (D-MA).

From Paul Krugman:

In the real world, recent events were a devastating refutation of the free-market orthodoxy that has ruled American politics these past three decades. Above all, the long crusade against financial regulation, the successful effort to unravel the prudential rules established after the Great Depression on the grounds that they were unnecessary, ended up demonstrating — at immense cost to the nation — that those rules were necessary, after all.

But down the rabbit hole, none of that happened. We didn’t find ourselves in a crisis because of runaway private lenders like Countrywide Financial. We didn’t find ourselves in a crisis because Wall Street pretended that slicing, dicing and rearranging bad loans could somehow create AAA assets — and private rating agencies played along. We didn’t find ourselves in a crisis because “shadow banks” like Lehman Brothers exploited gaps in financial regulation to create bank-type threats to the financial system without being subject to bank-type limits on risk-taking.

No, in the universe of the Republican Party we found ourselves in a crisis because Representative Barney Frank forced helpless bankers to lend money to the undeserving poor.

And after admitting that that last sentence was a little bit of an exaggeration, Krugman goes on to say:

Mr. Frank’s name did come up repeatedly as a villain in the crisis, and not just in the context of the Dodd-Frank financial reform bill, which Republicans want to repeal. You have to marvel at his alleged influence given the fact that he’s a Democrat and the vast bulk of the bad loans now afflicting our economy were made while George W. Bush was president and Republicans controlled the House with an iron grip. But he’s their preferred villain all the same.

Indeed Frank said as much while defending himself against Newt Gingrich, who wants to throw him in jail (see how this connects to the Trib's editorial?) for triggering the current bad economy. From Talkingpointsmemo:

Frank said Gingrich’s anger over his and Dodd’s role in the financial meltdown was absurd given that Republicans were in charge of the House and — excerpt for a brief period — Senate, from 1995 to 2007.He noted that he worked on reform legislation on mortgage in his first year as chair in 2007.

“It’s interesting, the charge is failure to stop Newt Gingrich and Tom Delay from deregulating,” he said. “This notion we caused the problem that started while they were in charge even by Gingrich’s standards is very odd.”

So most of the subprime loans were made when the GOP was in charge of the White House and the House of Representatives (and for most of that tine, the Senate) and yet, it's the "Democrat members of Congress" who are to blame and who should be feeling the wrath of the Occupy Wall Street folks.

This from the gang who still hasn't corrected itself for their $16 muffin mistake or the "Obama sought to apologize for Hiroshima but was turned down by Japan" mistake.

Yea, still waiting on those.

Jack Kelly Sunday

While the headline for Jack's column this week may turn out to be true, little else is.

Let's jump right in:

The member of Congress most responsible for our current economic troubles may pay for his sins in November.

Rep. Barney Frank, D-Mass, is chairman of the House Financial Services Committee. No one insisted more strongly on the lax lending standards at the heart of the subprime mortgage crisis. No one fought more vigorously against oversight of the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac), whose bankruptcies accelerated the economic collapse.

"The issue that day in 2003 was whether mortgage backers Fannie Mae and Freddie Mac were fiscally strong," wrote Donovan Slack of the Boston Globe Thursday. "Frank declared with his trademark confidence that they were, accusing critics and regulators of exaggerating threats to Fannie's and Freddie's financial integrity ... Now, it's clear he was wrong."

So much Jack-spin in such a small Jack-graf. This is such an old chestnut that Frank has already responded to it. In March of 2009:

[T]he Republican history on this subject appears to end in 2003. I understand why they find later events unpleasant, since those events document the gathering series of policy mistakes that the Republicans made which ended in their being repudiated in 2006, and re-repudiated in 2008. In their view of the world, the last relevant thing that happened was a statement I made in 2003 in which I said that Fannie Mae and Freddie Mac were not in crisis. I did say that. And I would have said it as well – and may have – about Wachovia Bank, Lehman Brothers, Bear Stearns, the Royal Bank of Scotland, and dozens of other financial institutions in America and elsewhere which were not in fact in crisis in 2003. [emphasis added]

He went on:

What happened subsequently, in the years the Republicans wish to ignore because they cannot defend what happened – is that the Bush administration pushed for even more subprime lending, Alan Greenspan refused to use congressional authority he’d been given in 1994 to regulate it, and the House Republicans blocked any efforts to legislate against it. In fact, as quoted in a story in the Bloomberg News, when the Bush administration ordered Fannie Mae and Freddie Mac to increase significantly the number of loans they bought for people below median income, I objected saying that this would be good neither for the borrowers who could not repay the loans nor for Fannie Mae and Freddie Mac.

Incidentally, Donovan Slack of the Globe (who Jack quotes) while heaping lots of blame on Congressman Frank also wrote:

But Frank said that putting blame entirely on him is unfair — and several independent analysts agree. They said Republicans also failed to take warning signs seriously enough to avert disaster, despite controlling the White House and both houses of Congress between 2003 and 2007, a crucial period leading up to the Fannie and Freddie failures.

Something of Slack's that Jack didn't quote. Same with this:

When the Democrats won control of the House in 2006 and Frank became chairman of the Financial Services Committee the following year, one of the first measures he helped pass imposed tougher regulations on Fannie and Freddie and prevented them from taking on too much risk.

“It’s the Republican line. They say it happened on my watch, but my watch began in January 2007,’’ Frank said. “The mistake I made was a nonoperational one — I wasn’t in power. From the day I became chairman, I think we did everything we could.’’

By the time Frank’s bill passed, it was too late.

Indeed for not fighting vigorously against oversight of the Fannie Mae and Freddie Mac, this is an odd charge considering that Frank sponsored the Federal Housing Finance Reform Act of 2007 which, according to the CRS summary:

Amends the Housing and Community Development Act of 1992 (Act) to establish, in place of the present Office of Federal Housing Enterprise Oversight, a Federal Housing Finance Agency (FHFA), headed by a Director (Director) possessing general supervisory and regulatory authority over the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac), and the federal home loan banks ("the regulated entities").

Jack, like some other conservative critics, conspicuously ends his history of the lending crisis at the punctuation ending Barney Frank's 2003 statement while his chairmanship of the Committee started 4 years later.

In any event, the whole "Fannie Mae/Freddie Mac created the crisis" is more or less bunk.

From Businessweek in 2008:

There’s a dangerous — and misleading — argument making the rounds about the causes of our current credit crisis. It’s emanating from Washington where politicians are engaging in the usual blame game but this time the stakes are so high that we can’t afford to fall victim to political doublespeak. In this fact-free zone, government sponsored mortgage giants Fannie Mae and Freddie Mac caused the real estate bubble and subprime meltdown. It’s completely false. Fannie Mae and Freddie Mac were victims of the credit crisis, not culprits.

Start with the most basic fact of all: virtually none of the $1.5 trillion of cratering subprime mortgages were backed by Fannie or Freddie. That’s right — most subprime mortgages did not meet Fannie or Freddie’s strict lending standards. All those no money down, no interest for a year, low teaser rate loans? All the loans made without checking a borrower’s income or employment history? All made in the private sector, without any support from Fannie and Freddie.

Look at the numbers. While the credit bubble was peaking from 2003 to 2006, the amount of loans originated by Fannie and Freddie dropped from $2.7 trillion to $1 trillion. Meanwhile, in the private sector, the amount of subprime loans originated jumped to $600 billion from $335 billion and Alt-A loans hit $400 billion from $85 billion in 2003. Fannie and Freddie, which wouldn’t accept crazy floating rate loans, which required income verification and minimum down payments, were left out of the insanity.

So Jack's arguments (that Fannie Mae/Freddie Mac is to blame and Barney Frank is responsible for that) are both old and incorrect.

How much of a surprise is that?

True Americans

Read this:

Tea partiers and other anti-health care activists are known to get rowdy, but today's protest on Capitol Hill--the day before the House is set to vote on historic health care legislation--went beyond the usual chanting and controversial signs, and veered into ugly bigotry and intimidation.

Civil rights hero Rep. John Lewis (D-GA) and fellow Congressional Black Caucus member Andre Carson (D-IN) related a particularly jarring encounter with a large crowd of protesters screaming "kill the bill"... and punctuating their chants with the word "nigger."

And then there's:

And that wasn't an isolated incident. Early this afternoon, standing outside a Democratic whip meeting in the Longworth House office building, I watched Rep. Barney Frank (D-MA) make his way out the door, en route to the neighboring Rayburn building. As he rounded the corner toward the exit, wading through a huge crowd of tea partiers and other health care protesters, an elderly white man screamed "Barney, you faggot"--a line that caused dozens of his confederates to erupt in laughter.

Great group of folks, huh?

One More Reason to Love Barney Frank

NOTE: I haven't been blogging lately because what started out the first day of Netroots Nation as an annoying sinus thingy (perhaps a summer cold/allergies) turned out to be a nasty, raging infection. I've been taking antibiotics since Monday and am starting to get better (missed the Friday and Saturday NN parties). I'll try to start really blogging again soon. Make sure you check out all the great photos Spork took (scroll down at his blog).
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Sorry!

It's my fault the bailout vote failed and the DOW cratered.

Yesterday was a travel day for me and when I was in DC I must have unconsciously looked funny at some Republicans and later when I was in lower Manhattan I said "boo" to some pigeons and some guys in suits heard me.


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ENDA and the Motion to Recommit

The Employment Non-Discrimination Act (ENDA) passed the House of Representatives yesterday by a vote of 235-184. (Go take a look - local Representatives Mike Doyle and Jason Altmire voted for ENDA).

The "transgender provisions" discussed here recently by Representative Barney Frank (D-MA) were to be introduced as an amendment by Representative Tammy Baldwin (D-WI). But before the vote was taken, she withdrew the amendment. She explains why:

In her comments, she said that while she felt the amendment would have "strong support," she also believed it would fail. She ended her comments with this (transcript here):

With a commitment to my colleagues and all Americans committed to equality of opportunity, and ending discrimination, that I will do everything within my power to make this measure whole again.

Of course the Republicans tried to kill the bill. Not on its merits, of course, but with something called a "Motion to Recommit." Here's what happened:

Rep. Randy Forbes (R-Va.) led the recommit effort, saying it was necessary to "ensure this bill does not become the building block that some may want to use to destroy the institution of marriage." His motion sought to send the bill back to committee to add language saying nothing in the bill could be construed as redefining marriage for federal or state purposes beyond the definition of "one man and one woman."

That’s when Frank stepped up to the podium at the front of the House and asked Forbes if he would allow the House to proceed to a vote on the bill if Democrats agreed to accept his language by unanimous consent. Forbes balked.

Frank said Forbes’s refusal to accept the offer was a clear indication that Republicans were simply seeking to send the bill back to committee with the "unmistakable intent to put this off until we are due to adjourn."

My understanding is that the instructions attached to the motion included language saying that it would stay with the Education and Labor for nine days before returning to the House.

But the House is adjourning in five days until next session - effectively killing the bill.

The motion to recommit was put to a vote where it failed 198-222. But take a look at the roll for that vote. It's alphabetical, so the name's easy to spot.

Representative Jason Altmire (D-PA) voted in favor of the motion to recommit.

I gotta ask the question, why he vote for a motion that would kill a bill that he, minutes later, would vote for?

I dropped an e-mail to the Congressman's spokesperson for an explanation. I'll report back whatever I hear.

A Lesson in Politics from Congressman Barney Frank

As we posted here, the Steel-City Stonewall Democrats and Congressman Mike Doyle hosted a meet-and-greet this past Saturday with Congressman Barney Frank (D-MA). I was free that afternoon, so I went. The place was crowded and I bumped into some of the usual suspects; Dan Onorato, Doug Shields, Valerie McDonald Roberts, and so on.

The meet-and-greet was, as I understand it, for Congressman Frank to gave a brief talk on the status of the Employment Non-Discrimination Act (ENDA) that's working its way through Congress. It became apparent that some of the lessons learned could easily be moved beyond that particular Act.

As is the protocol in these sorts of meetings, the introductions telescoped upwards to the guest of honor - Bruce Kraus introduced Congressman Doyle who introduced Congressman Frank. Kraus described Doyle was a great friend to the LGBT community and Doyle described Frank as "part-political theorist, part pittbull," who was so intimidating as a debater that no member of the House, while discussing an issue, ever wanted to hear Congressman Frank's voice interrupting "Will the gentleman yield?"

The issue at hand was a provision to add transgender people to those who are protected by ENDA. He released a statement a few weeks ago on this, by the way. The Act, he said, will "loose by 100 votes" with with the transgender provision included. From his released statement:

The question facing us – the LGBT community and the tens of millions of others who are active supporters of our fight against prejudice – is whether we should pass up the chance to adopt a very good bill because it has one major gap.

On Saturday, he put it more simply:

We are in danger of losing a victory we could win.

The outlines of the story, though, could easily cover the nationwide frustrations over the Congress' inability to, say, stop the war in Iraq or begin impeachment. Frank offered a target - the person to be angry at - James Madison. As we all know, the Constitution, while providing for a full election of the House of Representatives every two years, only allows for an election every two years for 1/3 of the Senate. The other 2/3 of the Senate, Frank said, were elected in 2002 and 2004, when the Republicans were still riding high, assing that it takes two elections to control the Senate.

Frank said he wanted to avoid the self-fulfilling prophecy of voters, frustrated that the 2006 Congress hasn't done more, will just stay away from the polls in 2008. On the other hand, he described a frustrating setting where the left was threatening allied Democrats in the House for NOT supporting the transgender provisions all the while NOT lobbying those moderates who hadn't yet decided. He said that on the left side of the internet (and I think he meant the liberal blogs) there wasn't much discussion about the danger of including the provision in the act. The Democrats control The House, so why can't they just add it on? Frank corrected that false impression by pointing out that the Constituion allows for two legislative bodies; The House and The Senate, NOT The House, The Senate and The Internet.

Add to that the danger faced by the new members of Congress who'd defeated incumbent Republicans in districts carried by Bush 2004.

Push too hard, too fast and some Democrats could loose their seats - and Frank wants nothing more than a Democratic Congress - with a larger majority. And he said that if you don't want politics to enter into a dicsussion of an issue, then don't ask 535 politicians how to deal with it.

While wishing the transgender provisions could be included, he said he believed the Act would go ahead without them. Doyle announced that Congressman Jason Altmire would be voting with Doyle and Frank on ENDA.

There were a few questions along the lines of "What should the transgendered community do now that the act is moving forward without it?" Frank replied that the community should be lobbying moderates who are undecided and supporting (not hurting) those allies who support the community.

An afternoon with Barney Frank!

An Afternoon with Congressman Barney Frank!

From the Steel City Stonewall Democrats:

October 24, 2007

Dear Friends,

Steel-City Stonewall Democrats and Congressman Mike Doyle would like to invite you to a Special Event with Representative Barney Frank of the 4th Congressional District of Massachusetts.

This is a casual meet and greet event with the Founder of the Stonewall Democrats, Rep. Barney Frank.

Please join us at the home of Christine Donohue* on Saturday, November 3, 2007 beginning at 3:00 p.m.

Event Details:
When: November 3, 2007
Time: 3:00 p.m.
Cost: Free and open to the public, Light refreshments will be served
Address: 6568 Fifth Avenue, Pittsburgh, 15206, at the corner of Fifth & Beechwood
Parking: Best option is parking along Beechwood

We look forward to seeing you on Saturday, November 3, 2007 at 3:00 pm.

*Christine Donohue is a candidate for the Superior Court of Pennsylvania and has graciously offered to lend her home for this event!

Mike Pintek's Feeble Argument

Caught a little of Night Talk last night. Mike Pintek interviewed Jennifer Victor, professor of Political Science over at Pitt.

It was an impressive choice for Pintek. He ususally interviews an obvious (and right-wing) partisan as a "political analyst" (Bill Green comes to mind here) but this time he actually seems to have snagged someone who spoke about politics without tilting the political scales in one direction or another.

And I think it threw Pintek a little - and that was fun to watch.

Anyway, they got around to discussing the latest Republican sex scandal when Pintek unveiled his defense. He asked "Isn't there something of a double standard at play here?" When Professor Victor asked what he meant, he brought up two sex scandals that involved Democrats: Gerry Studds' intern and Barney Frank's prostitution ring. Pintek said Studds was re-elected after the scandal hit and Barney Frank's still in the Congress after his scandal - I guess he was trying to point out how the Democrats go easy on their scandals, while the Republicans don't.

At this point I was feverishly trying to call in to correct the record. But all I got was a busy signal.

Let me point out a few things - perhaps someone can send Mr Pintek a link to this posting so perhaps he can learn a thing or two.

On Barney Frank.

Here's how Mediamatters describes things:

In August 1989, Stephen Gobie reportedly told The Washington Times that he ran a prostitution ring out of Frank's Washington, D.C., apartment and that Frank was aware of his operation. While Frank admitted to paying Gobie for sex several years earlier and to later hiring Gobie as an assistant, Frank denied any knowledge that Gobie allegedly ran a prostitution ring out of Frank's apartment. Frank maintained that he fired Gobie upon being told by one of his landlords that Gobie was using his residence for his prostitution business. As The Guardian reported on August 30, 1989, Frank actually "asked the House ethics committee ... to investigate his relationship with" Gobie.

The Boston Globe reported in 1990 that the House Ethics Committee found that Frank had "violated House rules by writing a misleading memo that was used in an effort to end prostitute Stephen Gobie's probation on felony charges and by allowing his House privileges to be used to waive 33 parking tickets that Gobie might have received while driving Frank's car." And for that, Frank was reprimanded in July of 1990.

The Ethics Committee absolved Frank of allegations that he was aware of any prostitution ring being run out of his house.

Not only that, but the Ethics Committee seems to have doubted that there was a prostitution ring in the first place. Here's Mediamatters quoting the ethics committee report:

Not only have Representative Frank's landlords, Colonel and Mrs. James Daugherty, submitted sworn testimony contradicting Mr. Gobie's assertion, Mr. Gobie's assertion has also been rendered questionable by the fact that his claims of call-forwarding service were contradicted by the telephone company.

Something else Mike Pintek didn't say. But take a look at when this all happened. This was 1990. And while it's true that the name of the man sitting in the Oval Office was "George Bush" it's still 17 years ago. Pintek is reaching back a generation to find this Democratic sex scandal.

On Gerry Studds.

Gerry Studds admitted to having an affair with a 17 year old male congressional page. That much Mike got right. What Mike Pintek didn't say was that Studds admitted this in 24 years ago in 1983. And the affair itself? It took place 10 years before that in 1973. So Pintek is reaching back 34 years to find this sex scandal involving a Democrat. By the way, the affair was consensual and the page, being 17 years old, was over the age of consent - so it was legal. The House censured him by a vote of 420-3.

It was embarrassing to watch, to be honest.