To the editor:
In 2003, as ranking Democrat on the House Financial Services Committee, Barney Frank, D Mass., said of Fannie Mae and Freddie Mac: "These two entities...are not facing any kind of financial crisis" and managed to bring to a halt the stricter oversight and regulation that was being recommended at the time.
Franklin Raines was chairman and CEO of Fannie Mae from 1999 until he took an "early retirement" in December of 2004 amid an investigation by the SEC of "accounting irregularities" which eventually led to a lawsuit seeking the return of $90 million in compensation that he received due to overstated earnings.
With no previous training or experience in finance Jamie Gorlick was appointed Vice Charman of Fannie Mae in 1997, a position that she held until 2003, serving alongside Frankin Raines.
During this time Fannie Mae developed a $10 Billion accounting scandal. Ms. Gorlick's compensation between 1998 to 2002 was $26.4 million.
Fannie Mae and Freddie Mac were both bailed out due the Financial Crisis of 2008. In a report delivered to the House Budget Committee in June of this year the CBO estimates that the cost of that bailout will be $317 billion.
The Financial Crisis of 2008 can arguably be traced back to a law enacted in 1977 called the "Community Reinvestment Act" which ordered lending institutions to change their lending criteria for home loans in order to include more minorities and low income households Today, those same minority and low income households have been disproportionately affected by loss of equity and foreclosure.
A consequence of "social justice."
General Motors and Chrysler were also bailed out by the U.S. Govt. due to the Financial Crisis of 2008.
For the first time in the history of U.S. corporate bankruptcy law, unions and their member's contracts took precedence over bondholders. The CBO's estimate of the cost to taxpayers of these bailouts is $14 billion.
Overseas, a two-bit crossdressing North African dictator has managed to retain power since March against our NATO allies and the rebels within while our leader in Washington, is "leading from behind" on an ill defined mission in which consent was sought from the U.N. and the Arab League but not our congress. You can bet that our friends and enemies alike will be keeping notes on this "Kinetic Military Action."
On the bright side in an interview last April our Treasury Secretary, Timothy Geithner was asked if there was any risk of the U.S. losing its top credit rating and he said empathically that there was "No risk at all" of that happening.
So at least we've got that going for us.