Monday, November 29, 2010
Post Thanksgiving Humor
I am sure that the link below has been pounded by all of those offended and even those not offended by the Transportation Safety Administration’s new “hands on policy.” Enjoy the laughs.
As funny as the slogans above are, if you’re into financial services issues, you shook laugh until you cry listening to the description of the Fed’s latest “Qualitative Easing 2.”
My favorite banker, Ed Yingling, is retiring as head of the American Bankers Association and reportedly joining a DC law firm (possibly one in which Ed’s late father, Jack, was once a principal).
Ed’s successor is going to be former Oklahoma Governor Frank Keating, who once was in HUD’s’ general counsel’s office, when Jack Kemp was Ronald Reagan’s Secretary.
The ABA‘s selection committee must not have realized that “Governor” Frank Keating cooperated with Fannie when we opened an Oklahoma “Partnership Office” (PO) and was one of the easiest governors with whom to work on housing matters. In reality, the list of Republican elected officials who at any time supported Fannie actually is quite long. (Don’t worry guys I won’t mention any names. Haff, kaff, harrumph, “John Boehner.” Oh crap, excuse me.)
I first met Ed Yingling when he was a young man working with his renowned lobbyist father, Jack Yingling, principal in the law firm Yingling and Shay, later Barnett, Yingling and Shay. Jack (and Ed) represented City Bank (nee Citicorp), among others.
At one time, before matrimony and fatherhood snatched away the handsome younger Yingling, Ed was a regular player in our infamous “poker game," which now has run for more than 40 years with a constantly changing cast of “characters,” with emphasis on the latter. (Suffice to say, it is a far more innocent gathering than rumor has it.)
While I’ve disagreed with bankers and with the ABA, I always liked and respected Ed. In his ABA time, while I was at Fannie, we worked on any number efforts to get Fannie officials and ABA leaders together and build understanding and mutual support.
I wish him all of the best and the same to Frank Keating, who is fortunate to have the very talented Dianne Casey on his association team.
Good for Jennifer Grey and her dance partner. The Palin kid never was that good. While I begrudge her no spotlight, ABC would have looked idiotic if the worst dancer took home the prize not because of her dancing skills but because of her last name. Suggesting her own victory would represent a “giant middle finger:” to the people in America who “hate her and her mother” Bristol reflected just the appropriate immaturity of someone her age.
Good for the San Francisco City Council overriding the Mayor’s veto and insisting that fast food meals for kids had to pass minimal nutrition tests. We are a fat nation and unhealthy. Our kids will get after unless some tough things—like this and many others-- are done.
Good for the Pope. I’ve dumped on the Vatican enough to recognize that “Yay Pope” is appropriate when he appears to endorse condom use if one of the partners has an active HIV condition.
Good for Rep. Spencer Bachus (R-Ala.), who reports to friends that the House GOP Caucus will name him Chairman of House Financial Services, despite all of the GOP unhappiness with him when he was ranking member. All of there Lilliputians, seeking to chop Bachus off at the ankles have gone onto other things. (Keep walking Michele Bachman (R-Minn)!)
I’ve suggested that Bachus will rule over a restive Financial Services Committee with his party dying to tear apart Fannie and Freddie, but not being able to do so until they have a viable alternative in place and “therein lies the rub!”
Good for GOP Senators Jim DeMint (R-SC) and Tom Coburn (R-Okla.), who are trying to organize their Republican brethren to vote against the $5 Billion ethanol subsidies. Lead gentlemen and they (the GOP Senators and enough D’s) might follow!
Bad Fors…Tom Delay and Charlie Rangel
This next one is going to cost me and I don’t know how to construct it into a “good for.” I don’t share the animus or anger at former Representative Tom Delay (R-Tex) that many of my Democratic friends do. I worked with him, when he was the Minority Whip, because he was willing to support Fannie Mae. I also respected the effort he put into helping abused kids and families.
His political abuses were the equal of what I had come to expect in Washington and similar to what I saw on both sides of the aisle. Yes, he should be punished for the crimes which the Texas jury convicted him, but I hope an extreme prison sentence is unnecessary, as some have demanded.
I also hope that Charlie Rangel (D-NY) does not stain his career standing in the well of the House and being officially reprimanded. Reportedly, he wants to serve in the 112th Congress, but I hope—after proving that his Harlem constituents still support and respect him--he retires before then.
Sunday, November 21, 2010
I confess I’ve always been a dreamer, so let’s dream share.
No this isn’t the one where I lead the Pittsburgh Steelers to the end zone in the last minute of play--to a win seventh Super Bowl--when a 300 pound frog, complete with “real” pictures of the “Maestro” in action, enters my huddle and begins pitching lurid tales of Alan Greenspan and Ayn Rand.
Our dream may not be that realistic ("go AG"), but it will be hopeful.
It starts when the political Left stops decrying the flood of new conservative Senators and Representatives to the GOP, worries about the House Democrats homogenization into a more “progressive/liberal” group (because of the losses of the Blue Dog Democrats and others), and shakes its collective head and sighs at the Obama White House’s continued bewilderment and failure to settle on a message let alone policy.
In this whimsy, we hope against hope and eschew the predictions of “two years of partisan gridlock”-- although there are understandable and substantive reasons for those predictions--and instead look at the Nov. 2 congressional election results as a clear message from an unhappy American public that it truly wants “change” (which it thought it was getting with the Obama election in 2008) and is tired of Washington’s posturing, finger pointing, and business as usual.
America uses the new Tea Party pols, in the fantasy, to send a missive to both parties, “Produce for us or lose your jobs.”
My flight of imagination started gelling when I heard and agreed with something said by newly elected Senator Rand Paul (R-Ky.), who was endorsing federal spending cuts and what that could mean.
Paul said (paraphrasing), “There aren’t enough ‘welfare expenditures’ in the federal budget to cut and balance it, even if you did away with every penny. No, we are going to have to go after lots of other things, including military spending and…..”
Anyone worth their partisan salt knows that neither party has draped itself in glory for the past 10 years, Both D’s and R’s, House and Senate, and the Bush and Obama administrations share in our national budget mess and upside down priorities.
After listening to Paul, I began to wonder if this influx of conservatives—which many of us have derided because of some of the extremists and extremes among that group—could force a major bipartisan reevaluation of government spending and priorities. Would that all be negative?
For instance, could the new Right—intent on deficit reduction--challenge the political underpinning of the two wars we are fighting in Afghanistan and Iraq, because they want to save some of the hundreds of billions of dollars we are spending there and elsewhere militarily and bring our soldiers home?
That fresh thinking--and resulting cost savings--would be a financial and progressive windfall and all because a bunch of right wingers believe Washington finally has spent too many taxpayer dollars unwisely and that the practice needs to end (an opinion easily reached but not grasped by any previous congressional majority going back a decade).
As part of a quid pro quo, could the GOP Tea Partiers force previously “unthinkable” policy changes like having the United States drop out of the United Nations or at least force the UN to relocate its headquarters elsewhere? We could plant the UN’s “blue and white” center of operations in Haiti, Kosovo, Myanmar, Sri Lanka, Kabul, Baghdad, or…..
Just like B'rer Rabbit, when confronted with B’rer Bear’s briar patch recommendation, I thought, “Twist my arm, twist my arm…..where do I sign to expel the UN from our shores?”
Why are we paying the UN hundreds of millions and hosting a bunch of angry foreigners who seem to hate us and delight in pulling Uncle Sam's beard, except when they need help money or medical and food supplies?
Let them headquarter in France, England or Russia. (If tossed from the US, does anyone think the entire UN membership would refuse to talk to one of—if not the—richest and still most militarily powerful countries in the world?)
Most of the Tea Party and its sympathizers are Republicans, but I’ve heard enough TP unhappiness with the stodgy GOP to suggest that Republican graybeards can’t take these newbies for granted. I think the new House leadership will have to earn their trust and “walk the walk,” not just spew forth the TP rhetoric.
In my dream--potentially “our” dream--the 112th Congress goes after some political untouchables, like agriculture subsidies, social security and Medicare, legalizing marijuana (saving billions in wasted law enforcement and imprisonment), and wasteful and unnecessary Pentagon spending, just to name a few?
As cynical and hard nosed as I have become, I will give these folks a chance to force some major, highly necessary and desirable changes in how this nation does business, including how it treats “big business.”
Corporate America puts their money where it will do it the most good and always has and always will.
Historically mostly that has meant contributions to the GOP, but with the Obama presidential campaign, a brief shift started and ended abruptly during the past election, when seemingly zillions publicly and secretly—thanks to the Supreme Court—funneled into GOP campaign coffers.
Tax Code Ripe for Pruning?
Repaying big business and other special interests, both parties have overloaded and made more confounding our tax codes. Why not get rid of some of these much valued tax exemptions--most of which represent just past favors handed out to favored industries or interest groups, forgotten and seldom reviewed--in exchange for overall reduction in tax rates for individuals, families, and corporations?
Just because some of these tax bennies have been in our federal tax code for years doesn’t mean they still are justified. (Before my tax lobbyist friends go bananas, cleaning up the code would allow you to bill clients for years to re-insert those goodies. You can work until you are 90, if you desire!!)
The public should think of those tax breaks as the equivalent of annual “earmarks” (special protected congressional spending for favored constituents or groups, which House and Senate Republicans just said they would oppose), but which annually drain Treasury billions.
Not all of those tax fixes are bad,but if rates were cut and the code simplified, the nation could get by, quite easily, without a majority of them. Nobody until now, possibly, has had the incentive to sit down and voice major support to jettison those tax provisions which may no longer truly necessary or politically favored.
Could the newest congressional class, sworn in next January, force both parties to do just that, along with some of the other spending cuts/savings they’ve endorsed specifically or generically?
The President’s “bipartisan” Deficit Commission, headed by Erskine Bowles and Alan Simpson, gives a handy starting blueprint and savings list. Most of the Commission's yet unapproved findings have been leaked to the press, so the choices are out there for public consumption and the fresh advocacy.
Maybe its just the warm feelings of good dreams, but one result of Nov. 2 could be the best chance we’ve had in years to undertake some major budget cutting, with the TP-ers holding the GOP’s feet to the fire while the Democrats—especially those D Senators up for re-election in 2012-- begin to realize that promising everything to everyone is not the recipe for fiscal sanity or even political success.
If John Boehner pulls off reform in some of the above, even I’ll find a way to say nice things about him!
On a personal note, as the holiday season kicks off this week, I want to extend a healthy and happy Thanksgiving to you and yours from me and mine.
And, please try to contribute your time or money to groups helping people who have so little.
Fannie’s all hands meeting last week--timing sucks!--produced major budget and staff cutback bad news, possibly as much 40% to 50% (people and spending) beginning in 2011, along with concomitant cutbacks in outside expenditures.
Irony: After more than 20 years of sponsoring and leading annual “Help the Homeless” campaigns in the DC area, raising millions of dollars, if there is one next year some aid recipients could be recently dumped Fannie Mae workers.
Tuesday, November 16, 2010
Many of the peripheral Mormon interests at Freddie Mac (yes, they once “ran the place”) thought that President Obama had answered their dreams (or fantasies) when he named “Joseph Smith” to be the new head of the Federal Housing Finance Agency (FHFA), Fannie’s and Freddie’s regulator.
Unfortunately for them, it is not “that” Joseph Smith of Latter Day Saints fame, just a plain old regular Joe Smith who has been North Carolina’s state banking commissioner.
I haven’t found a lot of people who know this Mr. Smith—and I certainly don’t personally—but one source said that he was a “consumer advocate,” which would be great assuming the Obama Administration lets him participate in Fannie and Freddie serious policy, at least until the 112th Congress chooses to put them in a shredder or whatever fate the powers in charge choose.
Assuming he gets confirmed, I think I can fairly state that none of Mr. Smith’s immediate predecessors approached their responsibilities with consumers as priorities. Armando Falcon, Jim Lockhart, and Ed DeMarco worried about their own image in town, F&F’s lobbying, F&F’s pr activities, F&F stock price and how to negatively impact those (see the late, lamented HUD IG report), F&F’s compensation (you get the picture), but not much about the “winners” in the GSEs mortgage activity, the American consumer.
So maybe FHFA Director Smith might consider those consumers and actually help F&F “conserve” resources, which supposedly is the job of the “Conservator.”
I hope someone alerts this Mr. Smith that he has some anti-GSE folks--and decidedly non-consumer advocates--among his inherited senior staff. Who are they? Oh he can just start looking at those who’ve been there the longest and I am sure he can uncover one or two (or maybe more) who fit that definition.
The new Director might be a convenient “beard” if the Obama Admin finds some reason to keep around the GSEs, besides the fact that they are currently funding 90% plus of the conventional mortgage market, and still waiting for the big banks to step up and play the secondary market role that F&F has.
Or, Mr. Smith could just be the funeral director of record, if the Congress and the Admin decide they need to abolish F&F and replace them with entities which don’t yet exist.
Stay tuned and here’s hoping that North Carolinian Joseph Smith is nasty street fighter, a fair regulator who wants to reinvigorate his GSE charges, and can appreciate that there was a successful Fannie/Freddie shaped mortgage finance world, before Wall Street created near worthless private label subprime securities. Post PLS GSE managers—along with financial service executives all over the world—bought the “garbage securities,” seeking elusive market share and yield, and undid a 20 year record of corporate good works.
My Team Appears to be Losing!
I feel like I am watching a slow motion train crash as the Obama Administration responds to steps on its story lines (when they exist) and flounders facing confrontational Republicans and Tea Party members two groups which never should be de-linked).
Fair questions for President Obama, since he seems to be on all sides of these matters.
“What is your view on the Bush tax cuts Mr. President? Just because the GOP won the House, does that mean we now can afford the lost revenue and disparity?”
“What does “tax compromise” mean, sir?”
BTW, which Democrats are challenging the new GOP winners over what the GOP's spending and deficit reduction priorities are?
The Republican agenda hasn’t changed since George W. Bush’s two terms and those ideas didn’t work then? Why are the D’s waiting until January to point out to the nation that the current GOP agenda is inconsistent and doesn’t have a snowball’s chance of passing mainly because they runs roughshod over GOP interests.
Does anyone really think all of those federal subsidies that the Republicans claim they want to ax really only go to Democrats or minorities?
President Obama, why wait until January to attack, the GOP isn’t waiting?
Watching this current ineffective political soap opera feels like my favorite football team trying, haltingly, to march down the field and score, but they keep being their own worst enemy, fumbling, dropping passes, or committing penalties game infractions.
During the 2008 Democratic primary, my wife was a major Hillary Clinton supporter. I liked Hillary but felt she had too many negatives and would lose.
Today, I can see where she might be a stronger candidate for President in 2012 than Barack Obama, even if the economy rights itself and unemployment comes down.
She has shown amazing toughness in a very tough job. She well could add Secretary of Defense to her resume, making her even more formidable. I also am not sure, if President Obama would want a second term.
Ironically, I don’t agree with the pair of pollsters, Pat Schoen and Pat Caddell, who suggested that Obama announce now that he will be a one term President and then just work on problem solving for the nation with no hint of any political priorities.
Sounds great but a “lame duck President” doesn’t have as much power as Messrs. Schoen and Caddell argue.
Who, in the Congress, would work with Obama if he announces early that he is out of the 2012 race?
“All the Devils Are Here”
I haven’t yet read “All the Devils Are Here,” the new book about the financial meltdown, by Bethany McLean and Joe Nocera, although Ms. McLean did interview me as part of her research. The book contains a good bit of insight on Fannie Mae and Freddie Mac and their political and institutional wars.
I have read several positive reviews of the work, including one that described it as the most detail rich of the growing number of books on the subject.
I told Ms. McLean that I hope her book is extremely successful and becomes a movie or a made for TV show, for very selfish reasons related to “feeding the cows to feed the crows.”
If the books goes TV or movie—I wish, I hope, I pray—and my tiny little part in this drama makes it into the final script, I want Antonio Banderas to play me.
Why? Because he’s Latin swarthy handsome, which I’ve been most of my life and he knows Selma Hayek and I want a personal introduction to Selma.
Remember them as lovers in “Desperado,” in which Banderas—as a vigilante—seeks to track down the Mexican drug king, who turns out to be his older brother? So, it’s simple, if Antonio plays me in an “All the Devils” movie, it’s a short step for me to ask him to introduce me to Selma. Book em’ Dano!!
Good luck to the McLean/Nocera writing team. Here's a wish for major book sales.
Wednesday, November 10, 2010
I doubt if many voters in Pennsylvania and Ohio—plus other states where the D’s lost big—had Nancy Pelosi (D-Cal.) on their minds when they went into the voting booths and supported more Republicans than Democrats, at all levels of government.
It just doesn’t work that way.
The GOP and its conservative allies tried to make her an “issue.” I don’t think they succeeded but she did become one of many Democrats and D policy positions, which the GOP demonized successfully and which carried their party onto numerous victories last Tuesday.
Many people who know the former Speaker much better than I talk about her selflessness and dedication to Democratic Party ideals, traditions, and platform.
Even with that as a given, I don’t think Rep, Pelosi should run for the leadership of her House party.
She obviously has chosen otherwise. I think she is making the wrong decision.
Fair or not, she has become too much of a lightning rod for those who dislike the party and its platform. ‘San Francisco liberal,” was one of the mildest epithets they threw at her, but in some congressional districts in this election it had the sting of a scorpion.
Congresswoman Pelosi should not seek the Minority Leader’s job, because she just is asking for more of the same personal and institutional political abuse.
I have no doubt about Ms. Pelosi’s capacity, instead as one who has spent years trying to undo myths and untruths about the GSEs, I don’t believe that Pelosi ever will have enough time or facts—nor an objective audience—to correct the opposition and undo the damage they caused.
People steeped in sports culture like to point out, “There is no ‘I’ in team.”
But, if you scramble the letters in the word, there is a “me” and I think Ms. Pelosi’s understandable decision is more about her concerns for her legacy than what is best for the House Democrats at this juncture with the 2012 elections less than two years away.
I hope Nancy Pelosi reconsiders her decision and then defers to one of her capable House colleagues.
The Pauls, Pere et Fils (father and son for those of you who don’t speak Spanish!)
I think the odds are pretty good that we will see new Sen. Rand Paul (R-Ky.) serving on the Senate Banking Committee, just as his father, Ron Paul (R-Tex) serves on its House counterpart. I believe the “father son service at the same time” is without precedent, but I have a feeling that we will see a lot of “precedents,” when the House Republican majority takes over next January.
The poor Fed!
Kudos to Bachus, Don’t Waver Spence
Spencer Bachus (R-Ala.) uttered a very truthful statement back home in Alabama this week. But he now seems to be backing way from his candor (and bravery!).
Bachus, who aspires to be the Republican Chairman to the House Financial Service Committee, told locals that he felt Sarah Palin cost the GOP control of the Senate by endorsing Tea Party/GOP primary candidates who couldn’t win the general election races and, indeed, did not.
The backsliding I think makes Bachus look less astute than he appeared when he made the original comments. But, other R’s share that perspective. Few of them have generated the attention that Bachus has. Yay Spencer!
Fannie and Freddie
During a conference call for financial analysts, I was asked if Fannie and Freddie could exist in their same “conservatorship” model two years from now, when the 2012 presidential and congressional elections occur.
The short answer is “yes,” but behind that suggests a failure of the Administration to put forward a thoughtful budget proposal—which it says is coming—one which can generate bi-partisan support.
The R’s and many D’s already want to do heinous things to the GSEs, so you would think that there might be an area of agreement here.
Except, the very conservative House might hold out for total decimation and I don’t think it has the political support for that. The “new Tea Party/GOP” House majority might and could pass a draconian bill that the Senate won’t support or the Admin would veto.
In the meantime, the “conserved” Fannie and Freddie would just chug along, financing 90+ percent of the conventional mortgage market, paying back the Treasury a usurious 10% rate on its borrowings (large banks only paid and pay 5%) and nothing dramatic happens in this stalemate.
At some point, between now and 2012, Fannie and Freddie might start making money
and opening the way for a thoughtful restructuring, ala the National Association of Realtors proposal or even Hank Paulson’s “regulated utility” idea.
If the above scenario evolves, the GSEs become a decision for the next President and Congress in 2013.
Thursday, November 4, 2010
Boehner’s “New Tea Party”
Speaker Boehner, indeed.
Well John Boehner now has won the post to which he has aspired and kudos to him for realizing his dream to be House Speaker. Like him or not, he’s part of the boffo GOP success.
But, as they say, “Now that we’ve won it, what do we do with it?”
Let me establish upfront that I don’t think the House Republicans will be able to conduct themselves in any manner save to try and savage the Obama Administration and weaken the President and the Democratic party for the 2012 races. They’re too narrow minded and selfish, both of which they displayed when they ran the Congress from 2000 to 2006 when George W. Bush was President.
I hope all of that has changed and now wiser the R’s will seek some form of bipartisanship…..but I doubt it.
It just may be that all of the Democrats who stayed home on Tuesday and all of those Independents, who voted against Obama’s policies, need is two years of the “new Tea Party” unvarnished to realize how unrealistic, backward looking, and self serving the new House majority is.
Do the American people, John Boehner, really want to rollback the limits Congress just this year put on Wall Street and large banks? Other than the ton of campaign money the financial services types plowed into GOP campaigns, what has the American public gotten from these institutions—besides watching their executive compensation grow as their lending slowed down, while banks invested their excess funds not in loans but in overnight Fed funds.
This is the crew that Boehner vows to save and that’s his “good public policy?”
Wait until new Senator Rand Paul (R-Ky.) takes that home to Kentucky and tries to sell it. Paul yells, “The federal government doesn’t create jobs, large and small businesses do.” Yea, yea. But the reality Senator is a lot of federal money flows through those commercial entities to create those jobs. But, I’m OK with stopping all federal funds from going to Kentucky and I expect that a majority of Americans would agree
I am ever reminded of the Tea Party rally where supporters carried signs saying “President Obama, Keep the Government Away from my Medicare.”
Boehner brags that the GOP and not the Democrats represent the American public. Just how is the GOP going to cut the deficit? There isn’t enough “fat”—which is a relative term—to cut and balance the federal budget.
Of course, now Speaker Boehner can stop his Republicans—who ran wild when they last controlled the House and booked huge federal deficits—from approving any “earmarks.” Those nifty “little” appropriated funds that cost hundreds of millions—and represent gifts to friends and constituents--which are tacked onto to “must have” legislation and see no scrutiny by anyone save the requesting Member or Senator.
Man up John and stop those congressional goodies!
Maybe the House GOP can start with some other “wasteful federal spending.” How about agriculture food supports or cotton and wool subsidies, highway construction, timber, and dairy subsidies? That could be a lot of lost jobs, especially in red states, if the Tea Party is going to go after those federal benefits. That shouldn’t stop our virtuous new heroes, should it? Class, class, Bueller, Buehler….?
Oh, they likely mean cut the federal benefits which go to urban minorities, like federal food stamps, But, aren’t the majority of food stamp recipients white?
I know “the new Tea Party” should put its House muscle behind closing unnecessary domestic military bases and ending weapon systems that even the Pentagon doesn’t want.
Now there is a valuable target.
What are the chances that Speaker Boehner will lead his troops in that direction?
Class, class, Bueller….??
The House Democrats do look ideologically homogenized. Maybe they can get their act together as the minority party. Maybe they can give Speaker Boehner a little of what he meted out to them?
I am happy for America that Harry Reid won, mainly because Sharon Angle— the Nevada Tea Party favorite—was so lame. But the Senate Democrats might consider a fresh new leader, with Chuck Schumer and Dick Durbin (the “odd couple roommates”) being the logical choices. I’ll take either over Harry, who had his day in the sun and proved wanting.
If You Are Going to Walk the Walk, Then You Need to…
Come on Michelle Bachman (R-Minn.), you can’t identify even one federal program you would cut? I just listed several areas known to millions. All you can complain about is how much the WH is spending on the President Obama’s trip to India. Did you complain about any Bush trips, even the one monthers back to “the Ranch” in Texas? Do you think he went without staffers and Secret Service protection surrouding him?
Responses: Barack Obama or Howard Dean?
As President the day after the election, Barack Obama offered a reasonable rejoinder to the GOP victories of Tuesday (paraphrasing), “The buck stops with me and I know a good part of yesterday’s vote was a rejection of my policies, but I still am ready to work with the GOP on behalf of the American people, etc. etc. etc.”
Former Vermont Governor and Democratic National Committee chair Howard Dean approached it a little differently, suggesting (paraphrasing), “If the Republicans expect to cut Medicare and Medicaid and give tax cuts to the wealthiest in American, we will wrap it around their necks and beat the hell out of them with it.”
Dean, who some see as a potential Obama rival in 2012, is not liked or trusted by Obama insiders.
Barack Obama is in office for the next two years and no amount of GOP taunting will change that fact. He continues to have a bully pulpit. I would have preferred that he uttered comments closer to Dean’s.
The President isn’t going to win friends or voters cozying up to the divided Republicans in both the House and Senate.
Spencer Bachus (R-Ala.) or whichever Republican stabs him in the back and takes the Chairmanship of the House Financial Services Committee from him should find ranking minority member Barney Frank (D-Mass.) a royal pain in the butt to cross or ignore.
Barney doesn’t do “nice” very well, but he can tear the flesh from most dullards who seek to substitute rhetoric for facts.
The flip side is that Barney could be “tired” after all of his work in this Congress and might not want to “bust balls.” But should he chose to engage, he may not have the votes but he will make it tough for anyone wanting to put Wall Street and the big banks on their old lofty pedestals, which seems to be the new Speaker’s goal.
I don’t think the House R’s have the votes or the creativity to force a new mortgage market model, i.e. the “Fannie/Freddie problem” on the Obama White House. So that matter must wait whatever will be the Obama plan promised in the new budget.
Tim Johnson (D-SD), the likely new Senate Banking Chairman, Chuck Schumer (D-NY) and Jack Reed (D-RI) should be able to control Dick Shelby (R-Ala) and the Committee R’s. Look for Rand Paul (R-Ky.) to wind up serving on this committee.
But, once the R’s agree on who will be the House Financial Services Chairman or Chairwoman, thinking of Michelle Bachman (R-Minn.), I am sure that we will hear all of the same canned anti-GSE rhetoric again.¬¬
Thursday’s American Banker carries a story quoting victorious Republicans on what changes they would like to make in the financial services area. Naturally they want to get Fannie and Freddie, but in the list of items they hope to accomplish is a recurring theme, end/limit new bank regulations on large investment and commercial banks, as well as the small guys.
The lesson of the George W. Bush years hardly was that we had too much federal financial regulation, but that we had too little and very few federal regulators stopped anything that Wall Street or the big banks wanted to do.
Now to be fair to the election winners, they’re giddy over their success and the implied power they have, but if their first steps are to reduce the height of the lion’s fence or remove it all together, people are going to get badly mauled and maybe lots of people.