I’m fully on board with blaming Democrat lawmakers in Washington for contributing to the mortgage crisis that started with Freddie Mac and Fannie Mae. Republicans introduced legislation that would more closely regulate the government sponsored entities (GSEs). Democrats – including Barney Frank (D-Mass.) – blocked that legislation, all but calling those asking for the changes racist.
Fox News and bloggers brought those stories to light, and now the Associated Press has written a story targeting former Republican lawmakers and staffers who were hired in 2006 by the GSEs to help keep Congress off their back. I’m willing to hear the evidence from 2006, but remember that the damage was already done by this time.
Here’s part of the story from knoxnews.com.
Internal Freddie Mac budget records show $11.7 million was paid to 52 outside lobbyists and consultants in 2006. Power brokers such as former House Speaker Newt Gingrich were recruited with six-figure contracts. Freddie Mac paid the following amounts to the firms of former Republican lawmakers or ex-GOP staffers in 2006:
-Sen. Alfonse D’Amato of New York, at Park Strategies, $240,000.
-Rep. Vin Weber of Minnesota, at Clark & Weinstock, $360,297.
-Rep. Susan Molinari of New York, at Washington Group, $300,062.
-Susan Hirschmann at Williams & Jensen, former chief of staff to House Majority Leader Tom DeLay, R-Texas, $240,790. …
The AP previously described, in October, how Freddie Mac thwarted efforts to bring a tough regulatory bill sponsored by Republican Sens. Chuck Hagel of Nebraska, John Sununu of New Hampshire, Elizabeth Dole of North Carolina and John McCain of Arizona to a full Senate vote.
At a meeting days after Hagel’s bill went to the full Senate, Syron and McLoughlin berated the company’s in-house lobbyists for failing to keep Hagel’s bill corralled in committee, said the four people familiar with events at Freddie Mac at the time.
Freddie Mac shifted into high gear, secretly paying a Republican consulting firm, Washington-based DCI Group, $2 million to kill Hagel’s legislation. The covert lobbying campaign targeted Republican senators in 2005-06.
According to the newly obtained records, DCI’s deployment was part of a broader campaign that targeted mainly Republicans on Capitol Hill.
The internal Freddie Mac documents show that 17 of the lobbying firms and consultants paid in 2006 were specifically directed to focus on Republicans and four on Democrats, with varying targets for the rest.
So, this tells us that the Democrats were already taken care of and on board with allowing the GSEs to move along with current management and current stupid policies. Republicans needed to be challenged, and it seemed to work for about one year, until the collapse.
I have not had time to research all of the information, but I’m certain that we’ll see a lot of reporting on this subject in the next few days.
Looking for a solution? Why not get Washington D.C. politicians – and the GSEs like Freddie Mac and Fannie Mae – out of private sector businesses like offering mortgages? I’m not saying that there should be zero regulation, but man, can’t we see how broke the current system is?
Previous information posted.
Update: Morrissey over at Hot Air just picked up on this.