MoveOn.Org is blaming John McCain for the mortgage crisis meltdown. If you are interested in reality, keep reading. McCain co-sponsored a bill to regulate the problem in 2005, yes more than three years ago. Even though the 109th Congress was a Republican Congress, it never left committee. His action, along with his co-sponsors, was prescient. If you choose not to read Senator McCain’s address on the Bill be sure to review the “You Tube” video on the reaction to mortgage regulation by Democrats in Congress at the end of his comments - it is eye opening! The following is his address to Congress on the Bill as found in the Congressional Record:
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.
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.
The YouTube video can be seen by clicking here:
The Democrats and Barack Obama have their hands all over this crisis, yet they have mastered the art of how to point a finger at McCain and the Republicans. Consider this: we may be expecting our elected officials in Congress to solve a financial crisis, which they barely understand. They were instrumental in creating the problem. We want them to do this in a bipartisan way. If we are expecting this to work, we all need to go out and get some fresh air to clear our heads. If after reading the McCain statement and viewing the “YouTube: video, you are convinced that the Republicans and John McCain, according to MoveOn.Org, are responsible, then the facts may be wasted on you.
Either way you should read this posting: Do you plan to rehire your Representative in Congress?
The only problem with this report is that McCain must not have been too concerned. Had he been I suspect that he would have had more luck in getting publicizing this issue and getting the bill moving.
If McCain was not too concerned, then Obama was not concerned at all. Raines is tied to Obama. Obama got big time contributions from the Freddie and Fannie leadership.
This is the most eye opening information I’ve ever seen.I feel as though I have been punched in the gut.I cannot believe the opinions of these democrats.They apparently have their heads in the sand and or have gone specifically racial lines as though protecting Mr Raines.
This should be shown on 60 Minutes.What a terrible,horrendous and calamitous event has taken place in our political arena that may take our grandchildrens children to correct if at all possible.
All sides have varying degrees of guilt, but it is obvious this once in blue moon piece of pro-regulation from Mccain, is not because of this crisis, but because of the Raines scandal. You have already noted it was Republican congress; so don’t understand the sole Democrat blame there.
But the main point against your argument is that none of this caused the crisis. It was the selling of packaged bad debt which led to the credit crunch. Allowed by de-regulation pushed by Republicans mainly in their 16 year occupation of congress, and during nearly 8 years of Republican Presidentcy.
I don’t believe you can blame deregulation completely on this, if we had no regulation at all it would be perfect simply on the fact that the lender’s would be more consious of the decisions they make on loans in order to make a profit. Problem is that w/ Fannie & Freddie had the full backing of the US government and weren’t afraid of failure. So in essence this is what caused this along w/ the lethal combonation of FORCING lenders to find ways to lend money to low-income households as well as middle class citizens w/ upper class taste. The loan officers had no obligation to the government to make wise decisions in who to lend to. They made their money not off the profitibility of the loan, but on the signing of the loan. This is very similar to the car business. The problem with all of this is that when the market was opened up to the low-income households as well as the middle class households who had upper class taste to purchase homes, the prices shot up big time. Only problem is they were inflated merely by the new false cover market. People were buying houses they couldn’t afford and lenders felt that if they fell through they would be able to flip the homes and still possibly make a profit or break even. Problem is the market went belly up and lending finally did the smart thing and tightened up who it lended money too, and backed themselves into a corner on this. Look at the banks that made it through fairly clean. Bank of America for instance never tried to move in on the low rate ARM(they didn’t promote it heavily), sticking w/ the upper middle class customer base they still are making a profit. They didn’t have those huge numbered years but in the end they are still strong. This is a corporate company who has to respond to it’s shareholders for all of it’s decisions and it is looking like a diamond right now.
Be careful of Bank of America – they and Wells Fargo have been granting mortgages and credit cards to illegal aliens for years – not a good credit decision.