A Bit Of Truth

Here’s a little bit of truth concerning Sen. McCain, Fannie Mae, Freddie Mac, and the current economic crisis that Obama, his followers and their MSM shills don’t want to publish.

Here is the truth straight from the US 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 legislation.

— Sen. John McCain
The Floor of the US Senate, May 25, 2006

That is correct; in 2005 Sen. McCain co-sponsored – along with four other Republican senators – legislation that might well have prevented the housing debacle and its resultant economic upheaval. Sadly, the Democrats led by Barney Frank and Chris Dodd quashed the bill before it could even be brought to vote.

Related Reading:

The Politics Book (Big Ideas Simply Explained)
The Righteous Mind: Why Good People Are Divided by Politics and Religion
The Economy: Economics for a Changing World
Angola, Clausewitz, and the American Way of War
Obama's Race: The 2008 Election and the Dream of a Post-Racial America (Chicago Studies in American Politics)

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15 Responses to “A Bit Of Truth”

  1. INVESTORS: Profits too slim, need to gain weight « The Sagamore Journal Says:

    […] the heart of the issue is that central theme – big is beautiful- at least when it comes to business, and world governments […]

  2. The Bruce Says:

    Jonolan-

    Thank you for this timely and accurate information regarding John McCain’s stance on economic reform. It is too bad, however that this will never be reported by the mainstream media – one can only hope that the candidate himself uses it to his advantage.

    Best.
    The Bruce

  3. McCain champions early intervention « The Sagamore Journal Says:

    […] it would apear that McCain identified and had a solution for our current crisis some time ago. Possibly related posts: (automatically generated)McCain […]

  4. Bill Stearns Says:

    Are you blind? McCain did nothing himself on this bill in 2005. It was in May 2006 that he spoke out and joined as a “co-sponsor”. According to govtrack, nothing happened with the bill after July 2005 (note as well that McCain is not listed as a co-sponsor).

    So let me offer my congratulations to Mr. McCain for pasting his name to a bill about a year after it had already died in the senate. Your quislings love you for it!

  5. jonolan Says:

    Bill,

    Try reading Govtrack:
    http://www.govtrack.us/congress/bill.xpd?bill=s109-190

    Just click on the “show cosponsors” link. It lists Sen. Elizabeth Dole [R-NC],
    Sen. John McCain [R-AZ] and Sen. John Sununu [R-NH] as cosponsors of the bill.

    I do have to correct the post though. It McCain worked with 4 other republicans, not two.

  6. cmblake6 Says:

    Indeed, brother. This is beyond insane. Does it show our “vote” to be naught but “smoke and mirrors”? If we know, and can, and have, prove(n) all of the things we know, why is this happening?

  7. gotea Says:

    Nice piece of info. Thanks for your visit to my site. I have added you to the roll. Hope to send more free thinkers your way.

  8. jonolan Says:

    Thank you, gotea and welcome to Reflections From A Murky Pond.

    As a side note, this is the legislation the Bill Clinton was referencing when he admitted that the Democrats had to take their share of the blame for the current financial / lending crisis.

  9. zhann Says:

    Its funny, but I have read this story on countless sites from both sides. The Obama supporters are pointing out everything Obama did for this cause, and everything McCain didn’t … and the McCain campaign does the exact opposite. Everyone, however, is missing the big picture.

    The way the US government, and most democratic governments, work is simple … he who pays more gets the vote. The concept of Pork Barreling, or special interests, is very basic. If you want a congressional vote to go your way, you line the pockets (legally I might add) of your favorite senators/congressmen. Those that are not lined, however, may become upset and vote against you. McCain, at that time, was one of those not on their christmas list, hence he tried to pass a bill against them. Both Freddie and Fannie have more than enough Senators/Congressman on their payroll to keep a bill like that from passing.

    Why not take a closer look at the $700 Billion bill that was just passed? How many pockets were lined with a $150 Billion slush package??? Dont worry, both McCain and Obama got their cut.

  10. jonolan Says:

    Much of what you’re saying doesn’t hope up under scrutiny of the Congressional Record and 3rd-Party analysis of voting records, Zhann. McCain has no record of adding earmarks to any bills during his tenure in the Senate. He was never on their “Christmas List.”

    He was deeply involved in the Bail-Out crap though. That is something that has seriously hurt him in my eyes.

  11. zhann Says:

    Jonolan, I am a cynic. I have lived in Europe, primarily Eastern Europe, for 4 years now. I see how politics work in these countries where bribery is open and unhidden. When I lived in the states, I was sheltered from the reality because I was given the impression that Bribery and Corruption don’t exist, or at the very most it existed in very small numbers. People in the USA think that there is a great deal of in-fighting between the Democrats and Republicans which minimizes corruption … the fact is, they simply have to work together because if one exposes the other, it causes a chain reaction.

    Of course, I have to assume that there is a great deal less in the states than in Eastern Europe … but, it is done on a MUCH larger scale in the states. Look at US history for more evidence.

  12. jonolan Says:

    Oh there’s tons of corruption in US politics; you have to look no further than the phrase “Chicago Style Politics” to see that. It’s entrenched in US political model.

    All I’m stating is that McCain has zero record for asking for an earmark on a bill. This one fact eliminated his biggest draw for people who would want to bribe him. This is because earmarks are the primary means by which Congress gets bribes.

    Any corruption that McCain may be involved in would have to be more esoteric and involved. Since many – or most – politicians will provide value for dollar in simpler and faster ways than McCain would, it’s doubtful most lobbyists would even bother with him.

  13. Moriah Says:

    Enjoyed this.

  14. jonolan Says:

    Thank you 🙂

  15. Ben Says:

    “Legislation that might well have prevented the housing debacle and its resultant economic upheaval.”

    It is true that Democrats and Republicans need to share the blame for what has happened but it is entirely false to suggest that this particular piece of legislation “might well have prevented the housing debacle.” Fannie Mae and Freddie Mac came to the party very, very late in the game. By the time they started getting heavily involved in sub-prime morgages the problem was already enormous and spiralling out of control. Regulating them would maybe have made the problem slightly smaller but that is all.

    There is a second issue too. While it was the sub-prime mortgage crisis that kicked everything off, what has really made this into a massive global crisis are credit default swaps – a market that needed serious regulation but had none at all. Neither Republicans nor Democrats, neither Obama nor McCain, supported regulation of this market – the only regulation that could have made a difference.

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