Wednesday, November 17, 2010

Barney Frank's irrelevance

Barney Frank’s ‘irrelevance’
By Howie Carr
Wednesday, November 3, 2010
Boston Herald Columnist

Barney Frank is the chairman of a very important House committee. At least for a few more weeks. Then he will be the “ranking member” — the ex-chairman.

Can someone say “irrelevant?” Think, a 70-year-old has-been?

But Barney can’t accept this morning’s new reality. Just as he can’t admit his complicity in the destruction of the U.S. economy, he can’t admit his approaching irrelevance.

Here he is last night, in the middle of his ungracious spittle-flecked victory speech:

“With the re-election of the Massachusetts delegation and Gov. Deval Patrick, we can acknowledge tonight that Massachusetts has reaffirmed the complete political irrelevance of the Boston Herald. There is no limit to the bias and vitriol they unleashed.”

Takes one to know one.

Now, we know one of Barney’s big problems with this newspaper is that reporter Dave Wedge videotaped his partner, James Dude Ready, giving the needle to Sean Bielat after a debate a couple of weeks ago. Wedge rolled tape. In Barney’s world this is bias and vitriol.

See, no one is supposed to say anything about Barney. Certainly the Globe treats him with kid gloves. For example, he’s present at a house in Maine with marijuana plants growing, but he doesn’t know what marijuana looks like. He used to live with a male prostitute named Hot Bottom, but you can’t mention that either, because it’s homophobia. And then there was Barney’s former partner, Herb Moses, who made a six-figure salary at Fannie or Freddie – I can never remember which.

Personally, I thought a defeat yesterday would have been great for Barney. At age 70, it would have given him a chance to do something he hasn’t done since he was 18.

Work at a real job.

No kidding, I’ll bet you thought he’d never had a real job. But this was an added bonus of the Bielat campaign — we learned more about Barney’s briefest of careers in the working world. See, he had to put out a campaign biography in which he claimed he once worked in what was called in the Eisenhower era a “filling station.”

You want to talk irrelevant? How about an over-the-hill back-bencher whose district is just crying out to be eliminated in the upcoming redistricting?

Testy Barney Frank incensed, even after big win
By Edward Mason and Jessica Heslam

Wednesday, November 3, 2010 NEWTON — A cranky U.S. Rep. Barney Frank blasted the Herald last night as “irrelevant,” even as surging Republicans grabbed control of the U.S. House and swept him from his lofty perch as chairman of the powerful financial services committee.

“With the re-election of the Massachusetts delegation and Gov. Deval Patrick, we can reaffirm the complete political irrelevance of the Boston Herald,” Frank told more than 100 supporters at the Crowne Plaza in Newton. “There is no limit to the bias and vitriol they unleashed.”

Frank won the hardest fight of his political career, fending off a fierce challenge from newcomer Sean Bielat. “This was a very important victory to win,” Frank said. “I’m very pleased to go back.”

Frank, 70, spoke at length of the strain of the “vitriolic” campaign on him and his partner, James Ready, and complained the “campaigns of most Republicans are beneath the dignity of democracy.”

Gracious in defeat, Bielat tried to comfort his crestfallen supporters, some who shed tears as word spread through the Newton Marriott ballroom he would lose his bid to unseat the liberal Democratic power broker.

“We did something that was next to impossible,” Bielat told his supporters. “We took on a 30-year incumbent in one of the most gerrymandered districts in the country, someone who outspent us by a million dollars, and we came close.”

“I see this as a success,” Bielat said. “For the first time in 30 years, people went to the polls tonight and they made a choice.”

Afterward, Bielat said he didn’t know whether he would run again and he’d have to talk it over with his wife. “It’s a sacrifice and we have to figure that out,” the 35-year-old Marine said.

Bielat supporter Bill Heck, 62, of Newton, said Frank’s “sell-by” date has expired. “I wish Barney Frank was a retired person effective January,” Heck said. “My wish did not come true.”

Wellesley grandmother Zeynep Mesta got emotional and said she hoped Bielat will run again. “I’ll work even harder next time,” Mesta said.

Barney Frank
Fannie Mae and Freddie Mac
In 2003, while the ranking Democrat on the Financial Services Committee, Frank opposed a Bush administration proposal, in response to accounting scandals, 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, supported by the head of Fannie Mae, 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."[59] In 2003, Frank also stated what has been called his "famous dice roll":[60] "I do not want the same kind of focus on safety and soundness [in the regulation of Fannie Mae and Freddie Mac] that we have in the Office of the Comptroller of the Currency and the Office of Thrift Supervision. I want to roll the dice a little bit more in this situation towards subsidised housing."[61]

Frank was criticized by conservative organizations for campaign contributions totaling $42,350 between 1989 and 2008. Critics[who?] claim the donations from Fannie and Freddie influenced his support of their lending programs, and say that Frank did not play a strong enough role in reforming the institutions in the years leading up to the Economic crisis of 2008.[62] In 2006 a Fannie Mae representative stated in SEC filings that they "did not participate in large amounts of these non-traditional mortgages in 2004 and 2005."[63] In response to criticism, Frank said, “In 2004, it was Bush who started to push Fannie and Freddie into subprime mortgages, because they were boasting about how they were expanding homeownership for low-income people. And I said at the time, ‘Hey—(a) this is going to jeopardize their profitability, but (b) it’s going to put people in homes they can’t afford, and they’re gonna lose them.’” [9]

In 2009 Frank responded to what he called "wholly inaccurate efforts by Republicans to blame Democrats, and [me] in particular" for the subprime mortgage crisis, which is linked to the financial crisis of 2007–2009.[64] He outlined his efforts to reform these institutions and add regulations, but met resistance from Republicans, with the main exception being a bill with Republican Mike Oxley that died because of opposition from President Bush.[64] The 2005 bill included Frank objectives, which were to impose tighter regulation of Fannie and Freddie and new funds for rental housing. Frank and Mike Oxley achieved broad bipartisan support for the bill in the Financial Services Committee, and it passed the House. But the Senate never voted on the measure, in part because President Bush was likely to veto it. “If it had passed, that would have been one of the ways we could have reined in the bowling ball going downhill called housing,” Oxley told Frank. In an op-ed piece in the Wall Street Journal, Lawrence B. Lindsey, a former economic adviser to President George W. Bush, wrote that Frank “is the only politician I know who has argued that we needed tighter rules that intentionally produce fewer homeowners and more renters.”[9] Once control shifted to the Democrats, Frank was able to help guide both the Federal Housing Reform Act (H.R. 1427) and the Mortgage Reform and Anti-Predatory Lending Act (H.R. 3915) to passage in 2007.[64] Frank also said that the Republican-led Gramm–Leach–Bliley Act of 1999, which repealed part of the Glass–Steagall Act of 1933 and removed the wall between commercial and investment banks, contributed to the financial meltdown.[64] Frank further stated that "during twelve years of Republican rule no reform was adopted regarding Fannie Mae and Freddie Mac. In 2007, a few months after I became the Chairman, the House passed a strong reform bill; we sought to get the [Bush] administration’s approval to include it in the economic stimulus legislation in January 2008; and finally got it passed and onto President Bush’s desk in July 2008. Moreover, "we were able to adopt it in nineteen months, and we could have done it much quicker if the [Bush] administration had cooperated."[65]

Chair of the House Financial Services Committee
Congressmen Ellison & Frank at Financial Services Field Hearing on Home Foreclosures in Minneapolis.As chairman of the House Financial Services Committee, beginning in 2007, Frank "sits at the center of power".[13] Frank has been a critic of aspects of the Federal Reserve system, partnering with some Republicans in opposition to some policies.[66] Frank says that he and Republican Congressman Ron Paul "first bonded because we were both conspicuous nonworshipers at the Temple of the Fed and of the High Priest Alan Greenspan.”[66]

Frank has been involved in mortgage foreclosure bailout issues.[67] In 2008 Frank supported passage of the American Housing Rescue & Foreclosure Prevention Act, intended to protect thousands of homeowners from foreclosure.[13] This law, H.R. 3221, is considered one of the most important and complex issues on which he worked.[13][68] In an August 2007 op-ed piece in Financial Times, Frank wrote, "In the debate between those who believe in essentially unregulated markets and others who hold that reasonable regulation diminishes market excesses without inhibiting their basic function, the subprime situation unfortunately provides ammunition for the latter view."[69] Frank was also instrumental in the passage of H.R. 5244, the Credit Cardholders' Bill of Rights Act of 2008, a measure that drew praise from editorial boards and consumer advocates.[70][71][72] In 2007 Frank co-sponsored legislation to reform the Section 202 refinancing program, which is for affordable housing for the elderly, and Section 811 disabled programs.[73] Frank has been a chief advocate of the National Housing Trust Fund,[9] which was created as part of the Housing and Economic Recovery Act of 2008 and was the first affordable housing program to be enacted by the Congress since 1990.[74]

During the subprime mortgage crisis, Frank was characterized as "a key deal-maker, an unlikely bridge between his party’s left-wing base and [...] free market conservatives" in the Bush administration.[75][76] Hank Paulson, the U.S. Treasury Secretary for the Bush administration, said he enjoyed Frank’s penchant for brokering deals, "he is looking to get things done and make a difference, he focuses on areas of agreement and tries to build on those."[75]

The New York Times noted that the Federal Housing Administration's crucial role in the nation's housing market, providing low-down-payment mortgages during the crisis of 2007–2010 when no mortgages would otherwise have been available, "helped avert full-scale disaster" by helping people purchase or refinance homes and thereby putting a floor under falling home prices. However, due to the tighter flow of credit from the banks, total FHA loans in 2009 were four times that of 2006, raising concern that year that if the economy were to dip back into recession, more Fed funds could be required to keep those loans afloat. Frank's response was that the additional defaults—2.2% more of the total portfolio in 2009 than the year before—were worth the economic stabilization of the broader policy, noting "It was an effort to keep prices from falling too fast." In that context, he opined, "I don't think it's a bad thing that the bad loans occurred." In fact, the unprecedented number of loans made since 2008 were noted to be performing far better than those in the prior two years.[77]

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