Bush orchestrated Fannie Mae F-up

Franklin Raines, who served as President Clinton's budget director, argues in court documents that the Bush administration felt the government-chartered agency wielded too much power in the mortgage industry. His attorneys say the White House pushed regulators to weaken Fannie Mae and triggered a $6 billion accounting scandal.

Raines subpoenaed the White House for documents in July. Justice Department lawyers will go before a federal judge Thursday to fight it.

Relying primarily on articles by financial journalists and the testimony of industry analysts, Raines describes in court documents an unofficial task force dubbed "Noriega" that was formed to weaken Fannie Mae and drive down its stock price.

Fannie Mae is the largest U.S. buyer and backer of home loans. It was created by Congress but is publicly traded. Raines says the Bush administration wanted to undermine confidence in the agency so it could push for tighter government controls.

• Bush orchestrated Fannie Mae F-up - sally
  • Nice try but no cigar..... - sam
    • The, now, infamous "Executive Privilege" - sally
      • Crooks are crooks....like Bill Clinton... - sam
        • Like JOHN MCCAIN - Keating 5 Scandal - sally
          • He was the only Republican of the 5.... - sam
    • glad you brought up Gorelick - Misty
  • see link - sally

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Freddie found itself in Justice Department crosshairs in 2003, after it finally admitted to years of accounting schemes to underreport its earnings...to the tune of $5 billion.  Freddie paid a $125 million fine to federal regulators, more than $400 million in shareholder lawsuit settlements, and $3.8 million in civil fines to settle Federal Election Commission charges of improper political fundraising.

Freddie's creative accounting was nothing compared to Fannie's.  As determined by two separate federal reports in 2004 and 2006, Fannie Mae out-and-out cooked the books so the bigwigs at the top could rake in millions in windfall profits.  The Washington Post reports that Fannie misstated its earnings by about $10.6 billion from 1998 through 2004.  all so fraudulent multimillion dollar bonuses could kick in for Fannhie's bigwigs.

Those Fannie Mae bigwigs who cashed in on the cooked books?  Chairman Franklin Raines, Bill Clinton's OMB director...A whopping $52 million.  Vice Chair Jamie Gorelick (remember her from the 9-11 Commission hearings), Clinton's deputy ATTORNEY GENERAL, $15 million.    Chairman and Chief Executive James A. Johnson, liberal lobbyist (the one who was kicked off Obama's VP vetting committee...looks like they should have vetted their committee) due to his role in the Countrywide financial scandal...$1.9 million.  Raines and the CFO of Fannie Mae were ousted.

Dems, loathe to clean up Fannie and Freddie houses even though Greenspan said preventitive action needed to be taken "sooner than later," came up with a "reform bill" in early 2005.  The Department of Housing and Urban Development (HUD) mandated that Fannie and Freddie had to start handing out mortgages to "minority and moderate income buyers."  Whether these new customers were creditworthywas of little concern; Congress had race and bean-counting to achieve.  And now they basically owned half of the US housing market.

And now the American taxpayer is bailing out BOTH of these companies.

Is Fannie Mae/Freddie Mac the Democrat's Enron?  Sure looks like it to me.

And incidentally, Franklin Raines has been advising the Obama campaign on the mortgage and housing issues....ahem.

1. Sen. Christopher Dodd (D-CT).. $165,400 (Chairman of Senate Banking Committee)
2. Sen. Barack Obama (D-IL)....... $126,349 (Only 4 yrs in the Senate)
3. Sen. John Kerry (D-MA).......... $111,000

Maybe the international community wants their money back now.  Maybe that is why credit markets are frozen.  Since AIG and Fannie and Freddie are backed by the full faith and credit of the United States, the world is lining up for their securitized mortgages to be repaid. 

Maybe this bailout is not to buy up bad debt, but to pay off bad debt the government has already bought, insured, and now needs to ask us money for to pay.  WE ARE BEING LIED TO AGAIN! 

Collapse or the Democrat Swindle of the U.S. Taxpayer

In 2006 an election year, the Democrats were still trying to lay the Enron scandal on Bush and the Republicans. With the help of the press a cover up of a larger financial scandal was taking place. A scandal that we are paying for today. In 2006 a 3 year investigation into fraud at Fannie Mae was concluded. It revealed a level of financial misconduct by Franklin Raines, Jamie Gorelick, and others that grossly overstated earnings by 10.6 Billion dollars. To gain bonuses.

 For those who don't know both Raines and Gorelick were high ranking officials in the Clinton Administration.

I hope you haven’t just eaten, because what you are about to read will disturb you–and well it should. It’s proof that John McCain foresaw the Freddie Mac, Fannie Mae disaster in 2006– and tried against all Obama-Like minds to ward it off.

Below are John McCain’s remarks urging the passage of the Federal Housing Enterprise Regulatory Reform Act of 2005, which he co-sponsored and which was rendered “Dead” in Congress.

Guess who prevailed and didn’t take heed? Or more appropriately, guess who deliberately “looked the other way”?

This is all we need to know to understand exactly WHICH candidate in this election is willing to break some eggs when it comes to Fannie Mae and Freddie Mac–two organizations that, with the help of certain Democrats, deliberately redistributed wealth the easy way. Now we are all paying for it, as intended all along. Just as John McCain warned below.

As we view the carnage, this is all we need to know to understand exactly WHICH candidate foresaw this carnage we are witnessing,  and which candidate worked to convince the other candidate to help avoid it. It is all we need to know to recognize exactly WHICH candidate had the right judgment and was looking out for the rest of us.

Joe Biden? It’s time for US to be Patriotic? No. It’s time for YOU to be patriotic. In fact, it’s too late. As for you saying, “It’s time to be part of the deal”. We want no part of this “deal”. And what a “deal” it was!

May 26, 2006

Mr. President, this week Fannie Mae’s regulator reported that the company’s quarterly reports of profit growth over the past few years were “illusions deliberately and systematically created” by the company’s senior management, which resulted in a $10.6 billion accounting scandal.

The Office of Federal Housing Enterprise Oversight’s report goes on to say that Fannie Mae employees deliberately and intentionally manipulated financial reports to hit earnings targets in order to trigger bonuses for senior executives. In the case of Franklin Raines, Fannie Mae’s former chief executive officer, OFHEO’s report shows that over half of Mr. Raines’ compensation for the 6 years through 2003 was directly tied to meeting earnings targets. The report of financial misconduct at Fannie Mae echoes the deeply troubling $5 billion profit restatement at Freddie Mac.

The OFHEO report also states that Fannie Mae used its political power to lobby Congress in an effort to interfere with the regulator’s examination of the company’s accounting problems. This report comes some weeks after Freddie Mac paid a record $3.8 million fine in a settlement with the Federal Election Commission and restated lobbying disclosure reports from 2004 to 2005. These are entities that have demonstrated over and over again that they are deeply in need of reform.

For years I have been concerned about the regulatory structure that governs Fannie Mae and Freddie Mac–known as Government-sponsored entities or GSEs–and the sheer magnitude of these companies and the role they play in the housing market. OFHEO’s report this week does nothing to ease these concerns. In fact, the report does quite the contrary. OFHEO’s report solidifies my view that the GSEs need to be reformed without delay.

Quick Info

S-90 Federal Housing Enterprise Regulatory Reform Act of 2005

Last Action: Committee on Banking, Housing, and Urban Affairs. Ordered to be reported with an amendment in the nature of a substitute favorably.

Status: Dead

I join as a cosponsor of the Federal Housing Enterprise Regulatory Reform Act of 2005, S. 190,to underscore my support for quick passage of GSE regulatory reform legislation. If Congress does not act, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system, and the economy as a whole.

I urge my colleagues to support swift action on this GSE reform legislation.

Update: Well looky here. Here’s a glowing Wall Street piece on Obama, written in June 2008. You would think Mr. “Regulator” Obama really is Jesus looking out for us! But…..here’s the paragraph that hooked me–the paragraph that haunts today:

He characterized the senator as a quick study on financial services, citing his early support of efforts by Senate Banking Committee Chairman Chris Dodd and House Financial Services Committee Chairman Barney Frank to empower the Federal Housing Administration to help struggling homeowners.

Oh they “empowered” all right. The Democrats killed this bill while Dodd, Frank and Obama fiddled and helped Fannie and Freddie cook their books, continue to tank, all the while keeping the regulators out of their way. These are the guys who killed the bill that McCain fought for. The bill that would have avoided the financial disaster we witnessed during the past two weeks. In the meantime, take a look at which senators were feeding at the Fannie Mae/Freddie Mac trough. My party is not what it used to be. My party has not only let me down, but it has also screwed me and my country in the process.

Note:  All of these facts can be independently confirmed if you are interested in the truth of this matter.

"Anyone in my office involved with a leak will be fired" to "Anyone who is found guilty of leaking," I figured he had a handle on what the decision is going to be by the special prosecutor, who, incidentally, was appointed by BUSH.

I guess time will tell if justice truly does prevail.

Bush makes Nixon look like a choir boy.

    Wednesday 31 August 2005

In 2001, FEMA warned that a hurricane striking New Orleans was one of the three most likely disasters in the U.S. But the Bush administration cut New Orleans flood control funding by 44 percent to pay for the Iraq war.

A New Orleans resident waded through floodwaters coated with a fine layer of oil in the flooded downtown area on Tuesday, August 30, 2005.

    A year ago the U.S. Army Corps of Engineers proposed to study how New Orleans could be protected from a catastrophic hurricane, but the Bush administration ordered that the research not be undertaken. After a flood killed six people in 1995, Congress created the Southeast Louisiana Urban Flood Control Project, in which the Corps of Engineers strengthened and renovated levees and pumping stations. In early 2001, the Federal Emergency Management Agency issued a report stating that a hurricane striking New Orleans was one of the three most likely disasters in the U.S., including a terrorist attack on New York City. But by 2003 the federal funding for the flood control project essentially dried up as it was drained into the Iraq war. In 2004, the Bush administration cut funding requested by the New Orleans district of the U.S. Army Corps of Engineers for holding back the waters of Lake Pontchartrain by more than 80 percent. Additional cuts at the beginning of this year (for a total reduction in funding of 44.2 percent since 2001) forced the New Orleans district of the Corps to impose a hiring freeze. The Senate had debated adding funds for fixing New Orleans' levees, but it was too late.

    The New Orleans Times-Picayune, which before the hurricane published a series on the federal funding problem, and whose presses are now underwater, reported online: No one can say they didn't see it coming ... Now in the wake of one of the worst storms ever, serious questions are being asked about the lack of preparation.

    The Bush administration's policy of turning over wetlands to developers almost certainly also contributed to the heightened level of the storm surge. In 1990, a federal task force began restoring lost wetlands surrounding New Orleans. Every two miles of wetland between the Crescent City and the Gulf reduces a surge by half a foot. Bush had promised no net loss of wetlands, a policy launched by his father's administration and bolstered by President Clinton. But he reversed his approach in 2003, unleashing the developers. The Army Corps of Engineers and the Environmental Protection Agency then announced they could no longer protect wetlands unless they were somehow related to interstate commerce.

    In response to this potential crisis, four leading environmental groups conducted a joint expert study, concluding in 2004 that without wetlands protection New Orleans could be devastated by an ordinary, much less a Category 4 or 5, hurricane. There's no way to describe how mindless a policy that is when it comes to wetlands protection, said one of the report's authors. The chairman of the White House's Council on Environmental Quality dismissed the study as highly questionable, and boasted, Everybody loves what we're doing.

    My administration's climate change policy will be science based, President Bush declared in June 2001. But in 2002, when the Environmental Protection Agency submitted a study on global warming to the United Nations reflecting its expert research, Bush derided it as a report put out by a bureaucracy, and excised the climate change assessment from the agency's annual report. The next year, when the EPA issued its first comprehensive Report on the Environment, stating, Climate change has global consequences for human health and the environment, the White House simply demanded removal of the line and all similar conclusions. At the G-8 meeting in Scotland this year, Bush successfully stymied any common action on global warming. Scientists, meanwhile, have continued to accumulate impressive data on the rising temperature of the oceans, which has produced more severe hurricanes.

    In February 2004, 60 of the nation's leading scientists, including 20 Nobel laureates, warned in a statement, Restoring Scientific Integrity in Policymaking: Successful application of science has played a large part in the policies that have made the United States of America the world's most powerful nation and its citizens increasingly prosperous and healthy ... Indeed, this principle has long been adhered to by presidents and administrations of both parties in forming and implementing policies. The administration of George W. Bush has, however, disregarded this principle ... The distortion of scientific knowledge for partisan political ends must cease. Bush completely ignored this statement.

    In the two weeks preceding the storm in the Gulf, the trumping of science by ideology and expertise by special interests accelerated. The Federal Drug Administration announced that it was postponing sale of the morning-after contraceptive pill, despite overwhelming scientific evidence of its safety and its approval by the FDA's scientific advisory board. The United Nations special envoy for HIV/AIDS in Africa accused the Bush administration of responsibility for a condom shortage in Uganda -- the result of the administration's evangelical Christian agenda of abstinence. When the chief of the Bureau of Justice Statistics in the Justice Department was ordered by the White House to delete its study that African-Americans and other minorities are subject to racial profiling in police traffic stops and he refused to buckle under, he was forced out of his job. When the Army Corps of Engineers' chief contracting oversight analyst objected to a $7 billion no-bid contract awarded for work in Iraq to Halliburton (the firm at which Vice President Cheney was formerly CEO), she was demoted despite her superior professional ratings. At the National Park Service, a former Cheney aide, a political appointee lacking professional background, drew up a plan to overturn past environmental practices and prohibit any mention of evolution while allowing sale of religious materials through the Park Service.

    On the day the levees burst in New Orleans, Bush delivered a speech in Colorado comparing the Iraq war to World War II and himself to Franklin D. Roosevelt: And he knew that the best way to bring peace and stability to the region was by bringing freedom to Japan. Bush had boarded his very own Streetcar Named Desire.

    --------

    Sidney Blumenthal, a former assistant and senior advisor to President Clinton and the author of The Clinton Wars, is writing a column for Salon and the Guardian of London.

me as TAXPAYERS) pays Faux News for its' *fair and balanced* reporting. 

Ya gotta laugh at the morons who actually BELIEVE this nitwit, though!

Democrat.  There is no money in it and he couldn't fake the compassion required.

succeeded in passing his privitization of Social Security.  Then we would be seeing all you gung-ho True Believer Repubs freaking out at the devastation of your retirement money.  You would have to walk the walk instead of pontificating endlessly on your favorite subjects - scarey terrorists, Ayers, socialism, Salinsky, yak, yak, yak.  It would serve ya all right.