Barney Frank’s Friends with Benefits
by Michelle Malkin
If you want to watch a corruptocrat start sputtering like Porky Pig with allergies, confront him with three simple words: conflict of interest. Asked this week about his role in securing an ex-lover’s highly coveted job at government mortgage giant Fannie Mae, Massachusetts Democratic Rep. Barney Frank retorted:
“Aba-dee aba-dee aba-dee aba-dee.”
Or that’s what it sounded like, anyway. Frank was rather miffed about the recent disclosure that he helped former lover Herb Moses land a job with the behemoth lender while sitting on a House committee that regulates lenders a decade ago. The Boston Herald reported Thursday that Frank immediately invoked the Everybody Does It card: “It is a common thing in Washington for members of Congress to have spouses work for the federal government. There is no rule against it at all.”
Frank then switched to the Everybody Knew defense: “It was widely known. It was out there in the public.”
Next, he dismissed any controversy about his ethical judgment with the Nobody Cares shield: “It’s nonsense.”
No doubt he’ll spring the Homophobia Card on critics at an opportune moment to ice his multitiered cake of excuses.
Funny thing. Not too long ago, it was Frank himself counseling fellow Democratic scandal magnet Rep. Maxine Waters to butt out of Boston-area OneUnited Bank’s bid for $12 million in federal TARP bailout funds because of conflict-of-interest odors. Waters’ husband, Sidney Williams, was an investor in one of the banks that merged into OneUnited and owned stock holdings estimated at $350,000.
Frank’s exact words to Waters: “You should stay out of it. … You should stay away from this.”
Waters didn’t listen. The House ethics committee charged her with several ethics violations (though no trial has yet been scheduled). Frank nearly broke his arm patting himself on the back and pronouncing himself “vindicated” after the charges were filed last year.
But where was Mr. Clean when his own sleazy dalliances needed self-policing?
While head of the House Financial Services Committee in 2009, amid economic upheaval across the country, Frank was jet-setting with hedge-fund mogul and TARP beneficiary S. Donald Sussman to his private Caribbean resort. The foxes in the House Ethics henhouse granted what they called “unusual” permission for the jaunt because Frank’s partner, Jim Ready, is close pals with Sussman. When Republicans raised questions about ethical improprieties, Frank — whose party has perfected the art of class warfare demagoguery — whinnied that it wasn’t a crime to have wealthy friends.
What should be criminal is the Democratic friends and fat cats protection racket run by the Fannie Mae and Freddie Mac overlords. While political operatives have raked in tens of millions of dollars in directors’ fees and lavish compensation packages, the government-sponsored lenders have bled billions and will soak up an estimated $400 billion in bailout funds. Financial journalist Gretchen Morgenson reported this week that Frank “was very aggressive and really tough” on Fannie critics after the corrupt institution “rolled out the red carpet” for his ex-lover. After his friend with crony benefits broke up with him, Frank remained a dogged Fannie defender.
Sneering at financial reformers before a 2003 House hearing, Frank asserted: “I want to begin by saying that I am glad to consider the legislation, but I do not think we are facing any kind of a crisis. That is, in my view, the two government-sponsored enterprises we are talking about here, Fannie Mae and Freddie Mac, are not in a crisis. … I do not think at this point there is a problem with a threat to the Treasury.”
Not that such spectacular bad judgment and lack of foresight should be any surprise coming from a politician whose early career was punctuated by a formal reprimand for using his office to fix another lover/prostitute’s parking tickets and lying about his criminal probation history. As a cocky Frank said at the time of that scandal: ”I think members of Congress rise or fall on their own individual records.” Eventually, yes.
Over the last two years, the Obama administration has approved a whopping $34.4 million in compensation to the top six executives of the financially troubled Fannie Mae and Freddie Mac mortgage giants while lacking basic protections to ensure such compensation is warranted, a federal watchdog found.
The largesse flowed to the six executives even though the two companies they run struggle to staunch billions of dollars in losses, remain in government conservatorship, and are required to repay taxpayers for assuming the companies’ liabilities during the mortgage crisis. Fannie and Freddie are tapping Treasury Department funds each quarter to help pay 10 percent dividends owed to the U.S. government.
“The need for effectiveness, integrity, and transparency in FHFA’s programs and operations cannot be overstated,” said Inspector General Steve Linick, a former Justice Department prosecutor confirmed by Senate last year to watch over federal housing programs. “Fannie Mae and Freddie Mac have received almost $154 billion in taxpayer funding to support the still-fragile housing market. In addition, they own or guarantee about $5.4 trillion in residential mortgage obligations.”