News that Newt Gingrich was receiving millions of dollars to advise Freddie Mac has to be a little unsettling for at least some conservative voters, who are accustomed to demonizing the government-sponsored entities Fannie Mae and Freddie Mac for causing the housing bubble, and hence the recession.
But it’s not just right-wing pundits like Bill O’Reilly who are fond of blaming it all on Fannie and Freddie. Here’s ABC reporter Jonathan Karl, speaking in conservative shorthand in his job as network news correspondent on This Week yesterday:
Meet this week’s new front-runner. He’s a good debater, man of ideas, and now Newt Gingrich is riding high in the polls, which means now the spotlight turns to all his baggage. Exhibit A: the nearly $2 million he got from Freddie Mac, a government-backed mortgage company that made so many bad loans, it helped bring the economy down.
We’ll set aside the stuff about Newt Gingrich, Man of Ideas (his most recent one involving having poor children replace janitors at their schools).
The more important question: Did Freddie Mac make the bad loans that crashed the economy?
No. You can read about that here or here, among many others. (UPDATE: To be clear, Fannie/Freddie don’t actually lend money to people buying homes– as McClatchy‘s Kevin Hall and David Goldstein explained back in 2008).
Or read this concise explanation from Fannie/Freddie critic Dean Baker, part of this response to a David Brooks column on this subject:
The worst junk mortgages that inflated the housing bubble to extraordinary levels were not bought and securitized by Fannie and Freddie, they were securitized by Citigroup, Merrill Lynch, Goldman Sachs, Lehman and the other private investment banks. These investment banks gobbled up the worst subprime and Alt-A garbage that sleaze operations like Ameriquest and Countrywide pushed on homebuyers.
The trillions of dollars that the geniuses at the private investment banks funneled into the housing market were the force that inflated the bubble to its 2006 peaks. Fannie and Freddie were followers in this story, jumping into the subprime and Alt-A market in 2005 to try to maintain market share. They were not the leaders.
So why is conservative mythology being treated as if it were fact by Jonathan Karl? Because that’s what he does.
That’s what he does
And perfidy loves company
FAIR doesn’t need to link to its Nov. 5, 2010 posting to illustrate NYT/PBS NewsHour pundit David Brooks’s dishonesty. There’s his Nov. 22, 2011 NYT column attempting â┚¬“ yet again â┚¬“ to create buzz words that serve him to demean liberals.
As always, Brooks starts by setting a fair-minded tone, often referencing some obscure academic work, and then he sneaks in the slurs. This time we’re told the two major parties are â┚¬Ã…“moonsâ┚¬Ã‚ of somehow equal inadequacy, and sprinkled through the usual pseudo-scientific drivel are such unsupported statements as these:
Some liberals are disappointed because â┚¬Ã…“â┚¬Ã‚¦ President Obama hasn’t ushered in a Huffington Post paradise.â┚¬Ã‚Â
Republicans have pledged not to raise taxes â┚¬Ã…“â┚¬Ã‚¦ to show that they haven’t been defiled by the Washington culture.â┚¬Ã‚Â
For Democrats, spending cuts are â┚¬Ã…“outside party orthodoxy.â┚¬Ã…“ Assuming Brooks is even remotely familiar with the current political scene, this one can only be regarded as a fabrication.
Perhaps some of your readers would agree that after years of persistent effort, David Brooks has emerged as the nation’s foremost socio-craptologist.
Once again we see made up facts to support false arguments. What a surprise from this Republican party of FRAUD!
Well I spoke for four years prior concerning the great sink hole that was Fannie and Freddy.People who believed as I did rang the clarion bell as hard as we could. Sadly we were right.Trying to shift blame now from F and F in the great collapse is a waste of time.It happened, and they were seminal.As far as Newt….he has had his hand in many many cookie jars.Befitting a Washington insider.He has zero folksy appeal(still important in this country).Is really a nerdy,snarky SOB at times.And i still say he is unelectable.