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Emanuel’s Freddie Mac Connection
Posted by: McQ on Friday, November 07, 2008

Well this isn't good:
President-elect Barack Obama's newly appointed chief of staff, Rahm Emanuel, served on the board of directors of the federal mortgage firm Freddie Mac at a time when scandal was brewing at the troubled agency and the board failed to spot "red flags," according to government reports reviewed by ABCNews.com.

According to a complaint later filed by the Securities and Exchange Commission, Freddie Mac, known formally as the Federal Home Loan Mortgage Corporation, misreported profits by billions of dollars in order to deceive investors between the years 2000 and 2002.
Emanuel's spokesperson essentially says "hey, he was only there a short time (13 months), what'd he know?"

As it turns out he was on the board at the time when the problems found in the SEC complaint were happening.

That's not to say it wasn't a problem earlier:
The SEC said Thursday it charged McLean-based Freddie Mac with securities fraud in connection with improper earnings management beginning as early as 1998 and lasting into 2002.
Since they were ongoing and the red flags should have been obvious, it follows that Emanuel and the board should have been aware of them, and, more importantly, done something about them.
Freddie Mac agreed to pay a $50 million penalty in 2007 to settle the SEC complaint and four top executives of the Federal Home Loan Mortgage Corporation were charged with negligent conduct and, like the company, agreed to settle the case without admitting or denying the allegations.
Any guess where the $50 million penalty is going to come from? Yup, that $200 billion they were handed to bail them out.

More importantly though is to look at the timing of the problem and Emanuel's tenure on the board:
During the years 2000, 2001 and 2002, according to the SEC, Freddie Mac substantially misrepresented its income to "present investors with the image of a company that would continue to generate predictable and growing earnings."
Seems to me to be at least a partial responsibility of the board (and the officers of the company) to ensure such misrepresentations aren't allowed - that is if you believe there is an 'oversight' function for a board (as in every other corporate board I'm aware of).

The oversight agency, the Office of Federal Housing Enterprise Oversight (OFHEO), apparently agrees and accuses the board of having "failed in its duty to follow up on matters brought to its attention."

Another with an apparent connection to the financial crisis serving in the new administration? It's hard to build confidence that the new administration is going to address and solve the problem when it names and considers officials who were partly responsible for it.
 
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I agree completely, Emanuel is an awful choice for Treasury Secretary.

We need to stop this NOW! ;-)


 
Written By: CaptinSarcastic
URL: http://
Has nothing to do with Treasury. It has to do with building confidence in a new administration. Appointing people to high level positions, where they will have influence in areas that will effect financial and economic policy and who were in part responsible for the financial disaster is hardly a way to build that confidence.
 
Written By: McQ
URL: http://www.QandO.net
Treasury Secretary?

Barney Frank will get that post.

And why would any of this shock anyone?
We were warned...


 
Written By: Bithead
URL: http://bitsblog.florack.us
Seems to me to be at least a partial responsibility of the board (and the officers of the company) to ensure such misrepresentations aren’t allowed - that is if you believe there is an ’oversight’ function for a board (as in every other corporate board I’m aware of).
Actually, that is an understatement, McQ. The directors of a corporation (or in this case a GSE) serve as fiduciaries of the shareholders. A director’s primary responsibility is to protect the interests of the shareholders and preventing fraudulent representations about the financial condition of the corporation is at the top of the list of those responsibilities. Emanuel may not have profited as handsomely as Raines, Johnson, Gorelick and the other miscreants at Fannie, but he and his fellow political insiders on the board bear direct responsibility for allowing the that fraud occur. Predictably, none of the people who were apoplectic about the imaginary association between Bush and Enron seem to have a problem with Emanuel’s very real association with Fannie. Nonetheless, the pick of Emanuel shows that Obama is not the change agent he has professed to be. But then again, we already knew that.
 
Written By: jt007
URL: http://
I agree completely, Emanuel is an awful choice for Treasury Secretary.

We need to stop this NOW! ;-)
And the sycophants rise to the defense....
 
Written By: shark
URL: http://
Emanuel may not have profited as handsomely as Raines, Johnson, Gorelick and the other miscreants at Fannie . . .
Maybe not, but I’d be curious to know just how much he was compensated for his 13 months there.
 
Written By: Arcs
URL: http://
Aros, I’ll tell you this... if there’s one reason McCain dserved to lose, it’s because they let questions like that float away. F&F and the Democrats tied to them, are the reason we’re in the soup right now, economically.Mccain should have been screaming non-stop about this one.
 
Written By: Bithead
URL: http://bitsblog.florack.us
McQ - Another with an apparent connection to the financial crisis serving in the new administration? It’s hard to build confidence that the new administration is going to address and solve the problem when it names and considers officials who were partly responsible for it.

Repeat after me:

It’s all Bush’s fault.
It’s all Bush’s fault.
It’s all Bush’s fault.

Do this enough and you’ll be on the road to building confidence and hope that the new administration is going to change the way things have always been done and address and solve the problem.
 
Written By: docjim505
URL: http://
It has to do with building confidence in a new administration.
What, you mean building confidence by appointing people who are immune to partisan attack like this one?

Get real.

No one is unassailable, and there is no effort here to see confidence built, just torn down.

I am reminded of dialogue from the movie Serenity...
Capt. Malcolm Reynolds: [the Operative has politely asked Mal to return River] You have to open with payment.

The Operative: That is a trap. I offer money, you’ll play the man of honor and take umbrage; I ask you to do what is right and you’ll play the brigand. I have no stomach for games.
There was no one that Obama could have chosen that would be above partisan hackery, so why not just chose the guy who you think has the best skills FOR THIS JOB, and happens to be one of your best friends.
Aros, I’ll tell you this... if there’s one reason McCain dserved to lose, it’s because they let questions like that float away. F&F and the Democrats tied to them, are the reason we’re in the soup right now, economically.
F&F are a part of the problem, not the cause (reason, as you said).

It is campaign rhetoric to suggest that F&F are the cause of the financial, just as much as suggesting that deregulation is the cause. The clearest causal analysis I have seen, in simple terms, is this short explanation put together by the folks at factcheck.org.
So who is to blame? There’s plenty of blame to go around, and it doesn’t fasten only on one party or even mainly on what Washington did or didn’t do. As The Economist magazine noted recently, the problem is one of "layered irresponsibility ... with hard-working homeowners and billionaire villains each playing a role." Here’s a partial list of those alleged to be at fault:

The Federal Reserve, which slashed interest rates after the dot-com bubble burst, making credit cheap.


Home buyers, who took advantage of easy credit to bid up the prices of homes excessively.


Congress, which continues to support a mortgage tax deduction that gives consumers a tax incentive to buy more expensive houses.


Real estate agents, most of whom work for the sellers rather than the buyers and who earned higher commissions from selling more expensive homes.


The Clinton administration, which pushed for less stringent credit and downpayment requirements for working- and middle-class families.


Mortgage brokers, who offered less-credit-worthy home buyers subprime, adjustable rate loans with low initial payments, but exploding interest rates.


Former Federal Reserve chairman Alan Greenspan, who in 2004, near the peak of the housing bubble, encouraged Americans to take out adjustable rate mortgages.


Wall Street firms, who paid too little attention to the quality of the risky loans that they bundled into Mortgage Backed Securities (MBS), and issued bonds using those securities as collateral.


The Bush administration, which failed to provide needed government oversight of the increasingly dicey mortgage-backed securities market.


An obscure accounting rule called mark-to-market, which can have the paradoxical result of making assets be worth less on paper than they are in reality during times of panic.


Collective delusion, or a belief on the part of all parties that home prices would keep rising forever, no matter how high or how fast they had already gone up.

The U.S. economy is enormously complicated. Screwing it up takes a great deal of cooperation. Claiming that a single piece of legislation was responsible for (or could have averted) the crisis is just political grandstanding. We have no advice to offer on how best to solve the financial crisis. But these sorts of partisan caricatures can only make the task more difficult.
Campaign’s over guys, save up for the policy fights, because if the right goes into attack mode over every tiny detail, by the time the policy fights start, the Republican Party will be the Party that whined wolf. And I don’t want to see that, I want to see persuasive counterarguments from the loyal opposition, not just kneejerk opposition to every little thing.

The nation has no stomach for such games.

 
Written By: CaptinSarcastic
URL: http://
What, you mean building confidence by appointing people who are immune to partisan attack like this one?
So he didn’t serve on the board of Freddie Mac and had no responsibility at all for its failure?

We shouldn’t expect those who caused the failure or are directly linked to it to be held responsible (not rewarded with increasing responsibility) for that failure?

The guy how is going to help Obama ramrod the effort to "fix this mess" helped make it but that’s all right by you?

After 8 years of claiming Republicans should take responsibility for what they’ve done, now the left wants to exempt its guys?

Yeah, that inspires a whole heap of confidence in this "new" politics doesn’t it?

Get used to it Cap. Every pick, every sentence, every pronouncement, every policy is going to be examined and criticized.

Nothing changes after 8 years except the side on the receiving end.

Enjoy.
 
Written By: McQ
URL: http://www.QandO.net
CaptinSarcastic - Campaign’s over guys, save up for the policy fights, because if the right goes into attack mode over every tiny detail, by the time the policy fights start, the Republican Party will be the Party that whined wolf. And I don’t want to see that, I want to see persuasive counterarguments from the loyal opposition, not just kneejerk opposition to every little thing.

You have a point, but I wouldn’t call this a "fight". Emmanuel has been tapped to be the White House CoS, which is an appointed position that nobody can really stop (he doesn’t have to be confirmed by the Senate, for example).

What McQ has done in this and an earlier post is point out a couple of things:

1. That the appointment of a hyperpartisan, Clinton Admin-retread is evidence that The Annointed One’s talk about changing our politics was, to borrow from him, "just words, just speeches";

2. That it’s a little hard to take seriously any idea that The Annointed One will fix the root causes of the meltdown and put our financial system back on a firm basis when he hires as his CoS one of the (many) people most responsible for the mess in the first place.

Republicans / conservatives would be a bit less inclined to go into attack mode over every little detail if The Annointed One would demonstrate that he really WILL do things differently and try to unite and "heal" the country.* By appointing Emmanuel, The Annointed One is to a small extent rubbing our faces in defeat. This is NOT a good way to win our support or even our polite silence while we wait to see what his BIG policies are going to be (I shudder to think...).

So, what ought we to do? You ask for a persuasive counterargument, so here’s one:

The Annointed One should ditch the Emmanuel pick and find a well-qualified but relative unknown candidate to be his CoS, somebody who is, if not non-partisan, then at least not hyper-partisan. Choosing such a person would send a good signal: that The Annointed One values competence above partisanship. This is not to say that Emmanuel isn’t competent; he probably is quite competent. But I’m not too impressed by slogans of "change" and "healing" when they are backed up with the appointment of people who drive steak knives into tables while reciting a list of political enemies and screaming, "He’s DEAD!"

This goes for most if not all of his appointments: choosing Clinton retreads and / or long-time Washington insiders and / or outright partisan hacks doesn’t build confidence on the right that we’ve misjudged The Annointed One and should keep silent unless (until) he REALLY screws up. Oh, and choosing a token RINO such as Hagel won’t fool us: we know that dodge. One would think that, in a country of over 300 million people, it would be possible to find qualified people to fill the cabinet and executive branch staff without having to dip into the polluted pool of Clinton stooges and other democrat (spit) hacks. One might argue that The Annointed One is paying back people who supported him by giving them big jobs, but isn’t that the "politics as usual" that he said he was going to change? Looks to me like he is a typical politician playing typical political games, and we can therefore expect him to do all the things a typical dem (spit) politician would do.

We’ve got no stomach for that.

——-

(*) I would like to point out that Bush billed himself as a "uniter" and was roundly scorned and even called a liar by the left when his efforts fell short of their expectations, i.e. he didn’t govern as a democrat (spit). Well, not a full democrat (spit); on domestic issues, he was too damned close to being a dem (spit) for MY tastes.
 
Written By: docjim505
URL: http://
into attack mode over every tiny detail, by the time the policy fights start
The nation has no stomach for such games.
Oh, I see...NOW we can play that card.

Silly me.
 
Written By: looker
URL: http://
There was no one that Obama could have chosen that would be above partisan hackery, so why not just chose the guy who you think has the best skills FOR THIS JOB, and happens to be one of your best friends.
The job of partisan hackery?? Is that what Chief of Staff is? Ok, agreed, he is the best capable of doing that specific definition of the job.

Sorry, it goes to character and he has none.
Oh, I see...NOW we can play that card.
Now that the shoe is on the other foot, it is all above fair and balanced. Well, we have been putting up with your rabies for 8 years now and we find talk of fairness a bit dishonest and hypocritical.
the Republican Party will be the Party that whined wolf. And I don’t want to see that, I want to see persuasive counterarguments from the loyal opposition, not just kneejerk opposition to every little thing.
So where have you been for the last 8 years, you have just described your side exactly.
The Bush administration, which failed to provide needed government oversight of the increasingly dicey mortgage-backed securities market.
To Capn Sarcastic: They tried 17 times, IDIOT, 17 f-ing times and the dems, your dems, stopped it. John McCain even tried to do somethign and your boys Frank and Obama called him a racist. You really are a disgusting punk. This whole thing is going to be a good time

 
Written By: capt joe
URL: http://
Now that the shoe is on the other foot, it is all above fair and balanced.
Really? Because I remember being told that dissent is the highest form of patriotism...

I intend to be VERY patriotic for the next several years...
 
Written By: Scott Jacobs
URL: http://
Get used to it Cap. Every pick, every sentence, every pronouncement, every policy is going to be examined and criticized
.

Obama made a pronouncement today, there were sentences in this pronouncement.

Obama may choose a Basenji, a hypoallergenic dog breed, as the White House puppy. Basenji’s originate in Arab regions.

Can we be sure that this dog won’t be a closet Muslim?

Examine away.


 
Written By: CaptinSarcastic
URL: http://
It’s entirely possible that the reason Emanuel is getting the point position at the White House is precisely because he was up to his neck in the Freddie/Fannie heist.

You leave that stuff out in the cold it could come banging at the door. Better to bring it inside and maybe even find a way to squeeze some more cash out of it.

You want somebody with real clout making sure that none of those pesky "career prosecutors" at the Justice Department start getting ideas.
 
Written By: Martin McPhillips
URL: http://newpaltzjournal.com
Examine away.
Heh ... see I knew you’d get it.
Basenji’s originate in Arab regions.

Can we be sure that this dog won’t be a closet Muslim?
See, only a lefty could come up with that bizarre twist. You know, like "Trig Palin is Bristol’s kid and Sarah faked the pregnancy". 8 years of practice I guess - we’ll have to learn what seems to come so natural to you guys.

Oh, and my guess is his two little girls made the decision, he just paid for it - that is if he’s a smart dad.
 
Written By: McQ
URL: http://www.QandO.net
To Capn Sarcastic: They tried 17 times, IDIOT, 17 f-ing times and the dems, your dems, stopped it.
Hmm, I must have missed every single one of those filibusters.

When did they have the votes, who led the filibuster?

I ask this because in 2005 Republicans controlled the Senate (and House for that matter), and the bill that Barney Frank opposed did make it out of committee, and yet it was never brought up for a vote, something the Republicans, and ONLY the Republicans could have done and chose not to.

So, you were saying?

If you’re going to get so emotional, at least you ought to have your facts straight.
You ask for a persuasive counterargument, so here’s one:

The Annointed One...
First rule of persuasive arguments, if the very first words of your very first sentence of your persuasive argument are an insult, you’ve already failed.

I have no idea whether whatever followed "The Annointed One" was even an argument, but you may as well have led with "Jane you ignorant slut".
I intend to be VERY patriotic for the next several years...


Finally ;-)

 
Written By: CaptinSarcastic
URL: http://
Obama made a pronouncement today, there were sentences in this pronouncement.

Obama may choose a Basenji, a hypoallergenic dog breed, as the White House puppy. Basenji’s originate in Arab regions.

Can we be sure that this dog won’t be a closet Muslim?

Examine away.
Bwahahahaha, after a cheap shot at Nancy Reagan to show how classy he is going to be....very Presidential.

But your answer is right where I expected. Hasn’t changed.
When pressed, re-direct.

I’m sure we don’t have the stomach for such games Cap.
 
Written By: looker
URL: http://
See, only a lefty could come up with that bizarre twist.
I just got lucky, I happen to have a hypoallergenic Basenji, and it being of Egyptian descent I accuse it of being a terrorist every time it pees where it shouldn’t.

(I did adopt it from the pound, by the way, along with my ridiculously stupid, but fun Pekineagle - Pekinese Beagle)

I’m just having fun with this stuff now. I won’t be opposing any of the appointments, and may even defend some, but I am most interested see what the result is of Obama’s policy agenda after if goes through the dual grinders of the legislature, and elected policy team (as opposed to the campaign policy team).

While I am not as concerned as you with appointments and trivial matters, I am very concerned with policy, because unlike the last 4 Presidential elections, the guy I voted for won this time and I can’t blame people who voted for the other guy anymore.
Bwahahahaha, after a cheap shot at Nancy Reagan to show how classy he is going to be....very Presidential.
I have to admit that I cringed at that one.

I have no idea whether comment is based on fact, fiction, or rumor, but he never should have gone there.

He was trying to be funny, and it would have been if he not mentioned Nancy Reagan’s name, but it was terribly unfunny because he did.

Good thing he didn’t say it on Monday ;-)
It’s entirely possible that the reason Emanuel is getting the point position at the White House is precisely because he was up to his neck in the Freddie/Fannie heist.
Shouldn’t you be getting to work on your Obama death list or something?
 
Written By: CaptinSarcastic
URL: http://
I ask this because in 2005 Republicans controlled the Senate (and House for that matter), and the bill that Barney Frank opposed did make it out of committee, and yet it was never brought up for a vote, something the Republicans, and ONLY the Republicans could have done and chose not to.
We were talking about the Bush Admin’s attempts to get congress to fix the GSE’s

Here is the list of 17 times that the admin asked for reform
Hmm, I must have missed every single one
or willfully blind because of hopey dopey change
least you ought to have your facts straight.
My facts are straight unlike your new admin.
Shouldn’t you be getting to work on your Obama death list or something?
Considering that is Rahm’s thing, I will leave it to his expertise.




 
Written By: capt joe
URL: http://
I will say this in praise of this pick- from the Ocarter perspective-

I wish Bush was this ruthless from the get go. What I predict Ocarter will do will be to quickly purge as many as possible from every single dept, and stack all his people in key places- something Bush didn’t do enough of. And that caused him untold amounts of misery.

That said, Ocarter has already made a liar of himself on the "change" issue, but we all knew what a load that was anyway
 
Written By: shark
URL: http://
By the way....the Nancy Reagan thing is yet another example of what a classless piece of excrement this guy is. Remember his "scratching his face with the middle finger" flipoff of both Hillary and McCain.

Hey, if the left could go nuts over some old college Rugby photo of Bush cheapshotting a guy during a match, this is fair game.

 
Written By: shark
URL: http://
have no idea whether comment is based on fact, fiction, or rumor, but he never should have gone there.
It’s based on the fact, and it was fact, that she admitted to consulting (an?) astrologer(s) for the Gipper’s schedules.

but, yeah, shouldn’t have gone there.
 
Written By: looker
URL: http://
I wish Bush was this ruthless from the get go.
Bush used strategry and got most of what he wanted (the most notable exceptions being reform of the good ship SS Ponzi and immigration). He didn’t need to be ruthless. He wouldn’t have a rotten punk like Rahm Emanuel anywhere near him.
 
Written By: Martin McPhillips
URL: http://newpaltzjournal.com
This will go nowhere because everybody in Washington, Democrat and Republican, realizes that jobs like that are only a way to pay off political hacks and give them something to do until they are back in office. The hacks are not expected to actually know or do anything, they should just stay out of management’s way.

hypoallergenic Basenji

A dog that is not a dog?? What sorcery is this? Hark! I hear google calling!

(Time passes)

"The Basenji may be the only breed where their owners brag about the destruction they wreak"
http://www.basenji.org/learn/

Sounds good to me! Just the kind of dog you want if you live in someone elses house.


"One of the health problems of the Basenji dog is Fanconi Syndrome. This is an inherited kidney disorder that usually begins showing signs around four years of age."
http://www.paws4k9s.com/rts/index.asp?action=page&name=14786&subname=7834&siteid=1674

Perfect timing. If I were a cynic I would say he is going for the sympathetic dog owner vote.

There are, incidentally, many other so-called hypoallergenic breeds. The Labradoodle (or doodle), Malti-Poo, Schnoodle, Xoloitzcuintle, and a number of Poos being just a few.
 
Written By: timactual
URL: http://
There are, incidentally, many other so-called hypoallergenic breeds
I picked Basenji because of the Muslim terrorist joke it allowed, and because I have one.

My Basenji is 13 years old and still scraps playfully with the puppy and has only been sick once in her life (since we adopted her when she was four).

By the way she has never destroyed anything.

Obama won’t be getting a Basenji, it was a joke, but they are hypoallergenic.

He’ll get a Chinese Crested, LMAO.

 
Written By: CaptinSarcastic
URL: http://
Here is the list of 17 times that the admin asked for reform
Wow, your an interesting bird, the link you provided that purports 17 requests for reform are ALL in 2008. I don’t know if you have been watching the news, but this problem was already well baked by 2008, in fact, it was already baked by 2007, the pain just had not entirely hit yet (it still hasn’t).

Further, there are claims that the administration warned the Republican majority Congress, back when it may have been possible to short circuit this disaster, but Republicans did not bring any bills to the floor. And no, they were not blocked in committee, there were bills, they did make it out of committee, but Republicans just never got around to having them voted on.

But hey, maybe if you say it again in all caps and call me names, the facts will change?

But you may want to consider the fact that I lay blame across the board, because that’s where it belongs. I might have a partisan interest in blaming Republicans, and I could make that dishonest case and stick to it, but I don’t work that way, if I did, I’d be just like you.
 
Written By: CaptinSarcastic
URL: http://
"He’ll get a Chinese Crested, LMAO."

But I thought genetic manipulation was a nono for Democrats!

The way I see it, if you are going to get a dog, get a real dog. Go English Mastiff!
"The breed is innately good natured, calm, easygoing, and surprisingly gentle. It is a well-mannered house pet but needs sufficient room for exercise and activity. The Mastiff is an extremely loyal breed, exceptionally devoted to its family and good with children."
http://en.wikipedia.org/wiki/English_Mastiff

You haven’t lived until you have a Mastiff that thinks it is a lapdog.

 
Written By: timactual
URL: http://
You haven’t lived until you have a Mastiff that thinks it is a lapdog.


I know what you mean. My friend has an 95lb America Bulldog that thinks it’s a puppy. You feel like Fred Flintstone being greeted Dino when you walk into the house.

All good fun
 
Written By: CaptinSarcastic
URL: http://
Wow, your an interesting bird, the link you provided that purports 17 requests for reform are ALL in 2008. I don’t know if you have been watching the news, but this problem was already well baked by 2008, in fact, it was already baked by 2007, the pain just had not entirely hit yet (it still hasn’t).
So what does the following mean?

2001

April: The Administration’s FY02 budget declares that the size of Fannie Mae and Freddie Mac is "a potential problem," because "financial trouble of a large GSE could cause strong repercussions in financial markets, affecting Federally insured entities and economic activity."

2002

May: The President calls for the disclosure and corporate governance principles contained in his 10-point plan for corporate responsibility to apply to Fannie Mae and Freddie Mac. (OMB Prompt Letter to OFHEO, 5/29/02)

2003

January: Freddie Mac announces it has to restate financial results for the previous three years.
That would be 2001 April, 2002 May, and 2003 January. And it goes on.

If you can’t read then that isn’t my problem. But is certianly explains a lot in the stupidity of your posts.


 
Written By: capt joe
URL: http://
CaptinSarcastic - I have no idea whether whatever followed "The Annointed One" was even an argument, but you may as well have led with "Jane you ignorant slut".

Yeah, that’s just the way I feel whenever a dem (spit) opens his mouth: he’s got nothing to say that I want to hear.

Welcome to the wonderful world of intolerance and closemindedness.
 
Written By: docjim505
URL: http://
Welcome to the wonderful world of intolerance and closemindedness.
I don’t start my arguments with insults because arguments that begin with insults don’t get heard. I do want to hear what people with different points of view, but no, I will not entertain an argument that begins with an insult.

Your perspective is admittedly a dit different than mine on this, since you acknowledged that if the person is a Democrat, you automatically disqualify anything they have to say, whether it is respectful or not.

I’m reminded of that line that asks, how can possibly claim to love America when you clearly hate half of all Americans.
That would be 2001 April, 2002 May, and 2003 January. And it goes on
Republicans controlled the Presidency, the Congress, and the Senate until mid 2001, and then again after January 2003, all the way until January 2007.

So what the heck are you arguing, that although Republicans, who had control of the entire government during most of this time, that Democrats are responsible for failing to pass legislation to avert the financial crisis? That’s simply ludicrous.

Democrats share blame for the financial crisis, but certainly not for what they didn’t do when didn’t control the government.





 
Written By: CaptinSarcastic
URL: http://
Republicans controlled the Presidency, the Congress, and the Senate until mid 2001, and then again after January 2003, all the way until January 2007
And during that time it passed out of the appropriate Senate committee on a straight partyline vote with Dems voting against it.

Now anyone who knows anything about how the Sentate works, and especially at that time, knows that something passing out on such a vote is going nowhere.
 
Written By: McQ
URL: http://www.QandO.net
I’m reminded of that line that asks, how can possibly claim to love America when you clearly hate half of all Americans.
Wow, just who has been saying that for the last 8 years. How much sh1t did you bozos spew about how much you hated the other side.
Democrats share blame for the financial crisis, but certainly not for what they didn’t do when didn’t control the government.
Well, the dems did nothing at all. Also they (Frank, Dodd, et al) were on the take so you can consider that these characters suppressed any effort by those few honest men to do the right thing.


 
Written By: capt joe
URL: http://
Now anyone who knows anything about how the Sentate works, and especially at that time, knows that something passing out on such a vote is going nowhere.


True enough, but Democrats hardly blocked the bill. Democrats had a proposal, Republicans had a proposal, but Republicans, having the majority, pushed their version through committee rather than hammering out a compromise bill with the Democrats. Knowing that a bill passed out of committee on a party line vote is not likely to see a floor vote makes it kind of counterproductive of the majority not to work out a bi-partisan bill, but the Republicans chose not to. Democrats had no power to bring their own bill, they had no power to force compromise, the only power they had was to vote in committee, and then on the floor.

This bill was not blocked, and you know as well as I do that the reality here is that it just wasn’t very important to either party.

Democrats deserve blame.

The notion put forward by folks like capt joe that this is all the Democrats fault is just silly.
GSE reform bill clears Senate Committee along party-line vote.

BOTH REPUBLICAN AND DEMOCRATIC members of the Senate Banking, Housing and Urban Affairs Committee agreed about the need for a stronger, more powerful regulator for the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac. But when it came time to vote on the GSE reform bill, members split along party lines, as the committee voted 11 to nine to move the bill to the Senate floor.

The Federal Housing Enterprise Regulatory Reform Act of 2005 (S. 190) would create and establish the Federal Housing Finance Agency as an independent agency. The legislation would give the new agency broad power to issue regulations and guide-lines, strong authority to better define and enforce charter acts, and flexible authority to set capital requirements over Fannie and Freddie and the Federal Home Loan Banks.

Throughout the bill’s mark-up in committee, members from both parties repeatedly expressed how "close" each side was in its desire to move the bill. However, the devil in the details was Fannie and Freddie’s $1.5 trillion mortgage portfolio investment holdings.

The Republican-backed measure would require Fannie Mae and Freddie Mac to sell portfolio assets unrelated to their mortgage securities businesses. A Democratic alternative would have permitted the regulator to reduce the GSEs’ portfolio without requiring such cuts.

During deliberations, Senate Banking Committee Chairman Sen. Richard Shelby (R-Alabama) dismissed the alternative submitted by ranking member Sen. Paul Sarbanes (D-Maryland), noting it did not give enough portfolio guidance to the regulator and had safety and soundness limits that were "not sufficient."

In opposing portfolio caps, Democrats expressed concern that such restrictions would harm Fannie and Freddie’s ability to ensure the mortgage market liquidity needed to foster affordable housing.

"There seems to be an expectation on the part of some that if Fannie and Freddie stop holding the assets in their portfolios, that the rest of the market will somehow instantaneously fill the void and that prices will not be affected," said Sen. Jon Corzine (D-New Jersey). "I do not believe that is a reasonable expectation."

S. 190 co-sponsor Sen. Chuck Hagel (R-Nebraska) countered that the GSEs’ portfolios are profitable for Fannie Mae and Freddie Mac shareholders, but do little to advance their housing mission.

"Fannie and Freddie are public companies with shareholders, and their boards have a fiduciary responsibility to those shareholders. But Congress did not create GSEs to enrich share-holders and executives," said Hagel. "They were created to provide stability and capital in the secondary housing finance market."

The committee also rejected an amendment by Sen. Jack Reed (D-Rhode Island) that would have directed the GSEs to contribute a percentage of their earnings to an affordable-housing trust fund. But the committee approved an amendment by Sen. Rick Santorum (R-Pennsylvania) to rewrite Fannie and Freddie’s affordable-housing goals. Both measures were rejected and adopted, respectively, along party-line votes.

In a letter to Shelby, Mortgage Bankers Association (MBA) Chairman Michael Petrie, CMB, noted that MBA was pleased the bill that cleared committee included language that delineated a clear "bright line" between the primary and secondary markets.

"Your legislation represents a clear understanding of the need to improve oversight of the GSEs relative to safety and soundness, systemic risk and to ensure that Fannie Mae and Freddie Mac do not deviate from their congressionally chartered purposes," Petrie wrote to Shelby. "Your bill’s product-approval and activity-review language is consistent with MBA’s long-standing policy that the regulator ought to establish a ’bright line’ to ensure the GSEs remain focused on their secondary-market purpose."

Despite having some "problems" with the portfolio language in the bill, Sen. Jim Bunning (R-Kentucky) urged the committee members to move the bill to the floor, where it would hopefully be passed and the measure would move to conference where, in the process of reconciling S. 190 with its House counterpart, H.R. 1461, "we can craft a bill that does what needs to be done."

However, even before the vote, Bunning and other committee members both Republican and Democrat noted that S. 190’s lack of bipartisan support will make the bill’s movement an uphill battle.

"We came to this point last year, and we could not get a bipartisan consensus and no bill was put forward," said Bunning. "Unfortunately, I believe we will have the same result. I believe we will move a bill out of committee, but without bipartisan consensus the bill will again go nowhere, and we will not have the world-class regulator we need."—C.W.
 
Written By: CaptinSarcastic
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