Posted by: tristar3research | April 9, 2009

Frank says Bernanke Approved AIG Bailout BEFORE $700B TARP Approved!

Pay the gatekeeper up front, and all pre-decided programs will be approved!

Pay the gatekeeper up front, and all pre-decided programs will be approved!

In an inflammatory response to a student question at the Harvard School of Government, Rep. Barney Frank bobs and weaves and weasels out of taking any responsibility for the subprime crisis and the lack of hedge fund and non-bank bank regulation. Frank gets hissy and nasty and points out that Bush FIRED SEC Chairman Bill Donaldson in 2006.Worse, Frank confesses that Fed Chair Ben Bernanke employed a 1932 statute in September 2008 to TELL Congress that the first $85B in “lending” to AIG was done. Then Paulson came to Congress and demanded that they approve the $700B TARP program “or else”! How about rule of law?

If this is your gatekeeper, then this is why we are in really deep muck, as the Boston Herald points out:

“In any other area of American life, this track record would get a man run out of town. In Washington, he’s hailed as a sage whose history of willful error will be forgotten faster than taxpayers can write a check for $200 billion.” – The Wall Street Journal on Rep. Barney Frank, Sept. 9, 2008]

The only thing more painful than watching 180 billion tax dollars swirl down the AIG drainpipe is listening to Barney Frank bloviate about it.

I don’t know The World’s Most Expensive Legislator personally, but I hear he’s quite a cut-up at cocktail parties. However, as legislator and politician, he is an unmitigated disaster. Frank combines the economic success of AIG, the business ethics of Enron and the personal accountability of Ruth Madoff.

Frank began his career opposing Reaganomics, an opposition that stubbornly resisted 25 years of nearly constant economic growth. In the 1990s, Frank sat on the Banking Committee regulating Fannie Mae, even as his then-partner, Herb Moses, worked as a Fannie exec.

Is it a coincidence that Frank has been a die-hard advocate for expanding Freddie/Fannie at any cost?

Since at least 2002, Frank fought an ever-growing drumbeat of calls to slow down the Fannie Mae/Freddie Mac train wreck.

In 2003, he famously said that Freddie and Fannie were “not in a crisis,” that they were “fundamentally sound financially.” He repeated that expert testimony in 2005, all the while rejecting the argument that the taxpayers were responsible for Freddie and Fannie’s bills.

And in 2007, he actually proposed raising the caps on Fannie/Freddie’s portfolios – exposing taxpayers to even more risk – and then dumping the new money into (drum roll, please) even more subprime mortgages.

Less than a year later, the Fannie/subprime/derivatives catastrophe was upon us. And the cheerleader for all three?

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