We have some Barney Frank sound bites coming up, and, as always, prior to those… Dadelut dadelut dadelut dadelut dadelut dadelut dadelut!
(playing of My Boy Lollipop)
RUSH: All right, ladies and gentlemen, Barney Frank, congressman, Massachusetts, is fit to be tied. He is not happy. The $700 billion bailout is not being used as it was intended. He thinks it is his money. He chaired a hearing today of the House Committee on Financial Services.
FRANK: The bill we passed that is accompanied by a requirement that any profit that is made on those loans be returned to the federal government in varying percentages for the first five years, and even more by the fact that the federal government then takes the House. This is not a free ride for that new borrower.
RUSH: Right. He continued. (laughing)
FRANK: We specifically put in that bill authority to the secretary of Treasury to buy whole loans or mortgage bank securities to make us the lender, to make us the owner so we could do these kinds of deductions. Again, the distinction seems to be between obviously owners and servicers. Today the secretary hasn’t used that authority. That’s a question now that we will have to address, and it will involve using the second 350, but I believe that we still have a need for that funding to be used to put the federal government in the position of being the owner so we can do the kind of sensible write-down of mortgage payments to avoid foreclosure that’s in the interests of the economy as a whole.
RUSH: Let me translate this for you. He made this speech after Paulson went out there and basically said, ‘You know what, we’re not going to do what we were originally going to do. We’re not going to buy up the bad paper, we’re not going to do that,’ started begging the banks to start lending and then we talk about bailing out credit card companies and auto companies, so Barney is saying here, ‘We explicitly put in the bill authority for the secretary of the Treasury to buy these mortgage-backed securities to make us the lender, the owner.’ And they’re not doing that, it’s his money. It’s like his money is being stolen, his food is being taken away from him on the table, and because of this Barney now says he feels vindicated.
FRANK: I will say I feel vindicated. When the bank of American announced that it was buying Countrywide, a number of my friends were concerned that this would be a problem, that Bank of America was too big, and I was asked with some consternation by one person with whom I’ve worked on some issues how I could justify supporting the Bank of America buying Countrywide. My answer is at that point I would have supported Syria buying Countrywide. The disaster that was inflicted on the country by Countrywide was deep-seated. I think Bank of America did a useful thing. Obviously they’re trying to make money, but I think society will benefit.
RUSH: (laughing) I would have supported Syria buying Countrywide. That’s Chris Dodd’s bank. Maybe Dubai could come back in and buy the ports now. (laughing) We could sell Countrywide to Syria. Here’s one more.
FRANK: There have been some plans floated to have taxpayer money go in, buy up the loans, and then reduce the amount paid. I think it should be very clear, no matter what people have argued, there is in my judge zero likelihood that federal taxpayer dollars will go to those who hold loans that never should have been made in the first place.
RUSH: So he says here that there is, in his judgment, zero likelihood that taxpayer dollars will go to those who should never have had loans in the first place. This is the same guy who said that Fannie Mae and Freddie Mac were on solid ground. Barney Frank, Chris Dodd, these people ought to be answering questions, not making statements. (laughing) Yeah, let me translate all four of those sound bites. (doing Barney Frank impression) ‘Those are our houses. (sputtering) They’re supposed to our houses, supposed to be the owner. (muttering)’ It didn’t work out the way old Barney thought it would.