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Fannie Mae, Freddie Mac, Unions

Can Someone Please Explain To Me



Isn’t it amazing the things that our going on today around the world, but much more concerning are what’s happening right here in our own country? I look around me every day and see things taking place that are absolutely appalling to me in their nature. I can’t for the life of me figure out the thinking or the reasoning behind most any of this, besides that their ultimate goal must be the destruction of our system of government put in place so many years ago by our Founding fathers, through our constitution.

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With this being said, could someone please explain to me…..

Fannie, Freddie, and the Housing Collapse

To many of you this may be old news, but understand there are millions of “clueless” still out there with virtually no knowledge of any of this. What you’re aware of yourselves is vital to be passed along to others, and please do so. But Fannie and Freddie are still pertinent in many ways to the economic struggle we’re faced with as a country and look to be for quite awhile still. So let’s take a quick look back at these two mortgage companies, their involvement in the housing collapse, and some of the main players involved then that are still involved in them today. Why do we keep blaming big business, the banks, Wall Street and all the other “capitalist” companies as the trouble with our economic system and as being evil? I understand corruption and greed did indeed take place, and in turn, contributed heavily to the economic hardships we’ve been enduring for the past couple of years. Plus, how we’re “preached” too constantly of the CEO’s exuberant salaries and bonuses. I got that part. But there’s little to no mention of the salaries and bonuses of Fannie and Freddie’s executives, or why we want to reform private companies while Fannie and Freddie continue operating as always, all the while operating by taxpayer bailout with no cap in place. What I’d like explained to me though is with all the government regulation in place, how could it happen? Isn’t Barney Frank chair of the House Committee on Financial Services? What’s the difference between the CEO’s actions and Barney Frank’s inaction? It all created the same mess, under Frank’s watch. Shouldn’t he and several others, Chris Dodd and Barack Obama come to mind, be held accountable in some sense for the collapse of our housing market? Didn’t Martha Stewart go to prison for five months for lying to officials over insider stock trading? What should the sentence be for job neglect or casting a “blind” eye, in turn causing an economic collapse in our country? Nothing apparently, as long as you’re an elected government official, but I still ask why? In 2003, Frank said, "These two entities -- Fannie Mae and Freddie Mac – are not facing any type of financial crisis. The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing." In 2004, Frank said at a hill hearing that an Office of the Federal Housing Enterprise Oversite (OFHEO) report of illegal activity by Fannie Mae does not "raise safety and soundness [of Fannie Mae investments] problems at issue". Then he out and out lies in regards to his role. Hear and see for yourself him speaking on this subject. Worse yet the House Democrats chastise the Bush administration for even thinking about stiffer reform measures for Fannie and Freddie. Again, take a few minutes and see and hear for yourselves, in their words, the attempts to cover up and mislead on this issue. They all played a hand in the housing collapse, yet today, from the President on down, they’re all calling for banking, Wall Street and corporate reform. Isn’t that what the Republicans were trying to get done through Fannie and Freddie? Please explain this to me. (Video) Franklin Raines was the CEO of Fannie Mae, and is a former member of the Carter and Clinton administrations. He advocated manipulating the accounting while at Fannie Mae to receive excessive “bonuses” by such wrong doings. Yet today is a financial advisor to President Obama. Isn’t it grand to be President and surrounded by people of such high merit? The New York Times reported two year ago that regulators "have said that of the $90 million paid to Mr. Raines from 1998 to 2003 at least $52 million—more than half—was tied to bonus targets that were reached by manipulating accounting." Raines agreed to a $24.7 million settlement with a federal regulator in exchange for charges being dropped, but he admitted no wrongdoing. 
Next up is Jamie S. Gorelick, whose official résumé describes her as "one of the longest serving Deputy Attorneys General of the United States," a position she held during the Clinton administration. Although Gorelick had no background in finance, she joined Fannie Mae in 1997 as vice chair and departed in 2003. For her trouble, Gorelick collected a staggering $26.4 million in total compensation, including bonuses. Federal investigators (PDF) would later say that "Fannie Mae's management directed employees to manipulate accounting and earnings to trigger maximum bonuses for senior executives from 1998 to 2003." The New York Times would call the manipulations an "$11 billion accounting scandal." Gorelick, it should be noted, has never been charged with any wrongdoing. The Heritage Foundation notes: In 2004, after a tip from a whistle blower who was later fired, the Office of Federal Housing Enterprise Oversight (Ofheo) issued a report finding that the government-sponsored entity Fannie Mae had engaged in Enron-like accounting machinations that allowed Fannie to overstate its earnings and underestimate the risk the company faced. The accounting wizardry Fannie engaged in was designed so that Fannie could meet profit targets to maximize bonus payments to company executives like Clinton administration deputy attorney general Jamie Gorelick and Carter administration assistant director for domestic policy Franklin Raines. The top 4 recipients of money from Fannie Mae in order of cash magnitude were:
  1. Sen. Christopher Dodd (D-CT), the Chairman of the Senate Banking, Housing and Urban Affairs Committee;
  2. Sen. Barack Obama (D-IL), a member of the Federal Financial Management Committee and now our president;
  3. Sen. Chuck Schumer (D-NY), Chairman of the Senate Finance Committee;
  4. Rep. Barney Frank (D-MA), Chairman of the House Financial Services Committee.
Incredibly, Sen. Dodd, Sen. Schumer and Rep. Frank are still today are the individuals primarily responsible for "oversight" at Fannie and Freddie, and Sen. Obama is now in the White House, as President Obama! Rahm Emanuel, our current White House Chief of Staff, worked as a director for Freddie Mac, 2000-2001, and he evidently failed to see any problems with the mortgage giant’s lending practices or other irregularities, or did he? Maybe the more appropriate question ought to be, “how couldn’t he?” During his “stint” as director he made $250,000. A couple other bits of information from the Heritage Foundation in regards to Fannie and Freddie: What's the main selling point for the financial regulation bill Congress is debating? That it would end taxpayer bailouts. The Senate even added an amendment directly noting that the bill is intended to "prohibit taxpayers from ever having to bail out the financial sector." Because the bill's many problems include this frequently overlooked fact: It does nothing to fix the problems with Freddie Mac and Fannie Mae, both of which A) played a major role in the meltdown of 2008 and B) are asking for more money. Most importantly: Both are losing money fast, with those losses being covered by the U.S. taxpayer. About a week ago, Freddie announced it had lost $8 billion in the first quarter of 2010 and would be asking for another $10.6 billion in taxpayer help. Not to be outdone, Fannie announced an $11.5 billion loss and asked for another $8.4 billion from taxpayers. That's atop the nearly $145 billion of your dollars that Fannie and Freddie have already received. And the total is sure to go higher: Last December, the Obama administration lifted caps on how much total bailout money the two can receive. The old limits were $200 billion each (though those estimates were widely understood as fiction). The new limits {hellip} well, there are no new limits. Moreover, requirements that the two shrink their portfolios were watered down. What I’d like explained to me is why and how does our administration “target” certain companies as “bad for the country” through their salaries or bonus programs, when in fact they are involved deeply in the same practices themselves? They love telling their constituents, “Bush did it”, or these banks, Wall Street or anyone else of their choosing are “stealing from the people.” So you see, Fannie and Freddie have no limits as the amount of taxpayer money they can and will receive. From the financial practices we see that have been condoned by our liberal politicians at Fannie and Freddie, there is no difference what so ever in these than the excessive bonus or salary taken from other companies, except one. Obama and “team” want to regulate and reform business practices in the U.S. with Fannie and Freddie the exception. Have you forgotten or do you even care anymore the fact that our current President represented ACORN in forcing Citi Bank to approve more home loans to the “poor,” and the cost to the country of such actions? Even I’m sharp enough to understand if you don’t make enough money to pay back your loan, then the loan will default. I mean, how simple is that? I have a seven year old grandson who completely understands that if he sees a basketball that costs $15.00, but he only has $10.00, then he can’t purchase it. This economic downturn has been “orchestrated” by the far left for years and years, and they now are reaping “grand rewards” for their efforts. The main reward being the socialist type control being legislated daily by our politicians in blatant disregard to our Constitution and the people’s voices. They know exactly what they’re doing, and inevitably they’d like to see us all in their little “socialist utopia.” By so doing, we suffer, while they enjoy the benefits of being the so-called “elites.” They feel their social status warrants these beliefs, as they are in their views superior to you and me. We all know what our country has offered us in terms of our freedoms, liberties, and that the opportunities these freedoms provide us with are virtually unlimited, but now these things are under attack by an administration that thinks their ideas and beliefs are far greater than that of our Founding Fathers. These people find Mao, Castro, even Hugo Chavez inspiring in their political beliefs. Simply put, their beliefs are all basically the same in its context….POWER, but only their power. With that being said, can someone please help me to understand why we continue as a nation to sit and let such atrocious behavior continue to take place in our country? After all the sacrifice that has been made by our previous countrymen in defending our freedoms against these same types of injustices worldwide?

The Unions

Here’s another fine example of power, greed and corruption. This means the unions today are concerned with the same goals that our elected leaders have decided that is their top priorities as well. Self-interest and no representation of the people. The problems you and I face today as a taxpaying, contributing segment of society have absolutely no meaning or are of little concern to our leaders. Their whole agenda is based entirely on the principle of me, me, me, me, me, and don’t forget….me! The unions through their demands, such as pensions, salaries, health care coverage, and excessive contractual obligation, have literally tied the hands of private, and public sector business, until we as a country can no longer compete in many areas of the global marketplace. Our costs are too high. Can anyone explain to me why we’ve allowed this to happen? In my last article for the “Canada Free Press,” titled, Taxpayer Cost of Public Retirement Plans, I cite example after example of outrageous costs to the taxpayer implemented by the unions through their pensions and retirement packages. I promise you, we cannot sustain such cost much longer; it is literally exploding year to year at this point. The State of California is a prime example of my last statement, and is imploding from within by the overwhelming cost of such plans. Gov. Schwarzenegger himself says, “The (California Pensions) have gone from $150 million to over $3 billion, adding this is a 2000% increase while State Revenues have increased by 26%.” Do the math for yourself. The State of California also has over 9,100 retired State employees making over $100,000 per year in retirement pensions! Then, we see some of the despicable acts carried out by the unions, especially the SEIU, where one blog-site describes them as the “Purple People Beaters.” Just recently the SEIU, and the National Political Action, a group out of, take a guess from where, Chicago, organized, and sent 14 school buses to the home of Bank of America senior executive, Greg Baer. Pouring out of the vehicles were around 500 screaming people, a mob, many of them waving signs, whose sole mission was to antagonize, harass, and intimidate the homeowner, Mr. Baer. Now remember, this was his residence! Why couldn’t this have been done in front of his office, especially when they were actually protesting the so called “wrong doings” of his place of employment, Bank of America? But no, these people were instead bussed to his private residence. What in the, well never mind, gives the Unions and any other organizations the right to invade a private residence? If you’ve seen the videos of this you see they were in his yard, right up to his home carrying on. Isn’t this an invasion of privacy, on top of trespassing? Of course it is, and no telling what other laws were broken. None of these people, or the groups responsible for organizing it, were concerned in the least in the welfare of Mr. Baer or his family, that’s a given, and in itself is reprehensible to put it mildly, very, very mildly! Mr. Baer had been attending a baseball game with his 12 year-old son and received the call on his way home of the events taking place at his home by his 14 year-old son, who by the way was so terrified of what was happening had locked himself in his bathroom. Mr. Baer parked his car down the street, left his 12 year-old in the car and walked through the crowd, got his 14 year-old, and left. Three things. First can you imagine the trauma suffered by his son who was so frightened that he locked himself in the bathroom? Here this child was, alone, but at his own home, yet felt so threatened he felt the need to seek refuge. 500 strangers in his yard, right outside his home, yelling no telling what types of vulgarities all directed at his place of residence. Imagine the fear you as adults would feel in the same situation, remember there were 500 people outside yelling and screaming, then imagine the fear a child would feel. This is totally unacceptable behavior by these people in doing this. Secondly, let’s look at the types of people they must be to even consider, much less doing such a thing. They’re evidently real winners! To frighten children, who had nothing to do in the least with anything these nuts were protesting anyway. It takes a person of absolutely ZERO morals to be involved in such behavior, by the way. Total losers one and all to be influenced to commit such despicable acts, but these are the types used by the left to empower themselves. Get the clueless to be your “foot soldiers” for you. With the promise of what? Something for free! Once again, these people think their leftist leaders are concerned with their welfare through subsidized housing, food stamps, etc., when in reality, and anybody with a nickel’s worth of sense can see it, they couldn’t give a …. about them! Dole out a pittance to them, then everything else is theirs, all the power and all the control. It’s all about me. What really steams me about this whole scenario, is remembering the way the left and even the mainstream media portrayed Sarah Palin’s children during the campaign, even to this day. But Barack Obama stated emphatically during the campaign for everyone to leave Michelle and his children out of it. No two-way street here, huh? But with the left there never is. They attack, attack, attack, whoever and whatever, but if you respond they cry foul, or you’re racist, or a right-wing extremist. Honestly, how long are we supposed to condone such actions by the left? I personally am beginning to tire of such actions, and these bus trips to private citizen’s homes by the SEIU, and remember ACORN was just as bad about this, has got to stop. Actually I was kind of shocked people in the neighborhood didn’t stop it on their own. I believe quite a few neighbors of mine would most certainly have been coming to my aid in that type of circumstance, as I assuredly would have been headed to their home if that’s how it had played out. Not condoning violence mind you, but serving in our own best interests as, here’s the type of talk the left can’t put up with again, law abiding, God-fearing, hard working American citizens. We feel our neighbors problems are in fact our problems. We’re a community in the true sense of the word. Thirdly, where in the world were the police??? A child in his own home terrorized by a mob of several hundred people, and NO police response? This, in itself, is an atrocity of great magnitude. I really can’t fathom such inaction by the people whose motto is, protect and serve. Journalist Nina Easton, a neighbor of Mr. Baer, states “Intimidation was the whole point of this exercise, and it worked-even on the police. A trio of officers who belatedly answered our calls confessed a fear that arrests might incite these trespassers.” What happens if they became incited without a police presence? I’ll say this once more these types of actions must be stopped from taking place at people’s homes. It cannot be allowed to take place. In closing I’d like to say that Sen. Bob Casey (D-Pa.), is introducing legislation for a bailout of troubled union pension funds. $165 billion worth of bailout! This, as is most everything else the government gets its hands into, could become an unlimited burden on the taxpayer, because these pensions have to be paid out until the workers die. Lovely. Sen. Casey claims this will save jobs and help people. Which ones? It won’t help the private sector taxpayer in the least. Forgive me though, I forgot, private business is evil. I don’t know what I was thinking. So, would someone please explain to me why the union’s, who promised these pensions to their employees to begin with, would receive taxpayer monies to pay for the commitments that they promised? Why is it my responsibility to give them money I earned, when I myself will have no such pension, no such heath care plan, or any other such perks? My retirement is money saved and investments made to hopefully see me through my senior years. If my investments collapse, do you think the SEIU would step up and bail out my family and me? We all know the answer to that. God Bless! (Pt. 2 Government Integrity and Immigration)


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Doug Bronson -- Bio and Archives

Doug Bronson is a small business owner in Florida and has written a book, “Simple Man…Simple Wisdom”


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