Earlier today, romantic connections between Democratic lawmaker Barney Frank and Fannie Mae executives¹
were detailed in the media. During the 1990’s, Frank - who is openly gay - had romantic relationships with key Fannie Mae executives during his tenure on the House banking committee.

Frank often explored Fannie; and in public, Frank maintained that Fannie Mae was a firm and robust organization. Supporters of Fannie were known to be generous givers to Frank, who always had an eager hand out for their contributions. While speculation at the time was rampant over Frank’s motivations for his joining with Rep Joe Kennedy to soften Fannie Mae’s stance on home-mortgage rules, the thought of a personal liaison seems not to have arisen.

We attempted to reach-around Capitol Hill for comments on the matter, but those inquiries remained unsatisfied.

This:

With this:

Notice the top one had to be smuggled out of the country after filmed on a cell phone camera and the second, filmed by NBC Universal President Jeff Zucker, was done with a RED camera. Yeah, the US is such a dictatorial, evil, repressive nation.

One more below the fold.

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If you listen closely, you can hear a lot of the “hell no” rhetoric starting to shift to “maybe we should vote for a plan.”

Even Tom Coburn has now said he would vote for the plan.

Why? Because while the conservatives on the Hill have been listening to people like me and you who are opposed to the plan, they are starting to hear from the front lines — the people who are already seeing that there is problem.

As I said the other day, I don’t support the plan, but I don’t begrudge those who do because it is very clear that something serious is happening out there that a lot of us in Macon, GA and Scranton, PA and Alameda, CA don’t quite see yet.

The White House and others are starting to circulate quotes tying Main Street to Wall Street. Whether you are like me and not so inclined to support this plan, or not, these are people who deserve to be heard.

Here’s a sampling:

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This is just wrong.

The Washington Post reports voters spread the blame for the broader economic problems facing the country:

In an open-ended question, a quarter of all voters said George W. Bush is responsible for the economy’s relatively poor performance, more than any other single cause. About a quarter name Congress (8 percent), the federal government (8 percent) and Democrats and Republicans (5 percent each) together. Eighteen percent said Wall Street financial institutions and banks shoulder responsibility, 7 percent blame “everyone” and 5 percent highlighted the role of individuals who borrowed too much.

There is of course a partisan divide:

Nearly half of all Democrats blame Bush; that is just 4 percent among Republicans. Moreover, no Democrats blamed “Democrats” generally; no Republicans singled out “Republicans.”

It’s just so wrong, there is a strong historical record, which clearly demonstrates the current financial meltdown should be laid at the feet of President Clinton, Congressional Democrats and their community organizers.

Matt Lewis reminds us that in 1999, President Clinton set “standards” that forced Fannie Mae and Freddie Mac to make bad loans.

As Lewis writes, in 1999, the Los Angeles Times noted:

Under Clinton, bank regulators have breathed the first real life into enforcement of the Community Reinvestment Act, a 20-year-old statute meant to combat “redlining” by requiring banks to serve their low-income communities. The administration also has sent a clear message by stiffening enforcement of the fair housing and fair lending laws.

The New York Times reported Fannie Mae came under “increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.”

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I don’t know how much play it will get, but hopefully a good bit.

This is your must read of the day.

The media will not report on Barack Obama’ ACORN ties.

The relevant question for all of this, however, is this: Did Barack Obama, as a voter registration organizer for ACORN, participate in or encourage voter fraud?

I suspect that he did. I’m told that Illinois and Missouri voter registration problems have Obama’s finger prints on them from his time with ACORN. It would not surprise me in the least.

But will the truth come out on this?

CNN is in overdrive blaming the Republicans for killing the bailout. This morning they ran a story headlined “The Death of the American Dream” about how angry the public is and how the bailout would have helped people, even though people are so angry and blaming Wall Street the people did not want the bailout.

In any event, consider these numbers:

Number of additional votes needed to pass the bailout: 12

Number of Democrats on Barney Frank’s committee who voted no: 12

Number of Democrats total who voted no on the plan: 95

Had Frank been able to control his committee or Pelosi the Democrats or had Barack Obama bothered to pick up the phone to support the plan he favored, it would have passed.

Aides to Mr. Obama said he had not directly reached out to try to sway any House Democrats who opposed the measure.

SOURCE

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Treasury Secretary Paulson gets the Oscar for Worst Salesmanship in Support of a Financial Rescue Plan (Super-Heavyweight Division).

I think you’d be hard-pressed to find one person out of twenty who understands that Paulson’s bailout plan is not a transfer of tax money from the middle class to the wealthy. It’s not the slightest surprise that more than half of Congress would find it impossible to vote for.

Speaker Pelosi, on the other hand, gets the Oscar for Most Disingenuous Performance by a Legislative Leader Not Running For President. She looked so stupid and incompetent in not getting the bailout approved by the House yesterday, that one suspects this was somehow her plan all along.

The stock market, which had been led to expect approval of this piece of legislative sausage, promptly had an aneurysm and went on to its largest point loss in history, dropping nearly nine percent of its value on the day.

What happens next?

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“Shouldn’t somebody in the media ask Obama why he was Fannie Mae’s favorite senator?”

Pelosi screwed up royally.  She is the Democratic Tom DeLay.  Newt Gingrich was an ideologue, but Tom DeLay was simply a partisan, most keenly interested in maximizing his party’s political power.  Pelosi cut a deal in which, as far as I can tell, every single Republican in a safe seat had to vote yes so that the Democrats could maximize their no votes.  Given that the Republican caucus is pretty much in open revolt, this was beyond moronic.  She then spent a week openly and repeatedly blaming the Republicans and the Bush administration for the current crisis.  The way she set things up, it was “Heads I win, tails you lose”:  vote for the deal and I’ll paint you as heartless reactionaries bailing out your fat cat friends.  If you’re going to do that, you’d better make sure you have some goddamn margin for error in your own party.  She didn’t.  Then she got up and delivered yet another speech blaming the Republicans for the bailout deal she was about to pass.

Being in power means that you get to give your party special favors on many occasions–but it also means that you, yes you, have the ultimate responsibility for getting things done.  She didn’t particularly try to bring her party in line, and so of course as soon as a few Republicans defected, hers stampeded.  The ultimate blame for this failure has to be laid at her feet.

–Megan McArdle.

This is useful. Note the first bullet point. It relates to the Community Reinvestment Act, which, along with other governmental failures, brought this crisis about.

Remember that the next time someone tells you that this crisis constitutes proof that free markets can’t be trusted.

Because we all could use some humor tonight, here’s a fact about Coca-Cola I bet you didn’t know. From its Wikipedia entry:

Coca-Cola’s advertising has had a significant impact on your mom

Leon Wolf denies all responsibility for adding that to the entry.

1. The media today is trumpeting the fact that today the Dow Jones Industrial Average dropped by more points than on any other day in history. This caught my attention not because of the number, but because usually the media also gives us the percentage drop. Today they did not — caught up instead in the number. Peter Robinson notes the drop was only 7% in value as opposed to the 22% drop in 1987.

2. I’m a bit gobsmacked that conservative pundits who supported the bailout are attacking members of Congress for listening to their constituents. Amazing how representative democracy worked well today and that’s not good enough for some people. Truth be told, the public could very well be wrong, but members of Congress, like on the immigration bill, listened and voted accordingly.

3. Does it really hurt Republicans that the media is blaming the GOP for killing something the public did not want anyway?

4. Those of us who opposed the bill may actually have shot ourselves in the foot. Now Nancy and the Dems could very well pass a bill far to the left of the compromised Paulson plan by rallying some of those Democrats to the plan who refused to vote for today’s plan. The President, naturally, will sign it.

5. Not that we need reminding the media is out to get conservatives, but it is amazing they are so willing to blame the GOP for this when all the evidence shows Nancy Pelosi and the Democrats could have passed the plan if they wanted. And how is it that the 60+ 133 Republicans who voted no are unpatriotic, but the 95 Democrats who voted against it are not? Or maybe everyone just realizes the 95 Democrats hate America.

6. I updated 5. I had the number of Republicans wrong. I was looking at the “for” as opposed to the “noes” as the Congress spells the negative vote.

7. Notice the legislation was not entitled the “Wall Street Bailout Act of 2008.” instead, the legislation was titled, ” A Bill To amend the Internal Revenue Code of 1986 to provide earnings assistance and tax relief to members of the uniformed services, volunteer firefighters, and Peace Corps volunteers, and for other purposes.” That’s spin for you.

Congressman Peter DeFazio (D. Or.) said that Nancy Pelosi and the House Democratic leadership always assumed that the bailout bill would pass. As a result, they failed to lean hard enough on people like DeFazio and other House Democrats who were allowed to vote “no” as a matter of conscience.

Once again, Nancy Pelosi & Co. couldn’t count votes within their own caucus, failed to understand that getting votes from the Republican Caucus would be difficult enough under ordinary circumstances, completely misread the mood of the House and failed to pass the bailout bill. As the majority party, the Democrats bear the responsibility for this failure. If the Speaker’s gavel is too heavy for Nancy Pelosi, she should give it to someone else and if the House Democrats can’t lead in a time of crisis, they ought to step aside and let someone else do the work.

On MSNBC earlier, Bill Burton, Barack Obama’s spin master said

I mean on saturday night when the negotiators were all getting together, [McCain] wasn’t making phone calls and doing the work. He was actually out at one of the finest restaurants in Washington, D.C., on a double date with his wife. I think Joe Lieberman was there with their wives. I understand they had a great meal. It was a great restaurant. What we need to do is put the rubber to the road here. Get on the phone, get the leaders together, and get the votes that we need. And when his campaign said they brought the House Republicans to the table and had gotten the votes, they actually didn’t. Two-thirds of House Republicans voted against this today. That’s not the sort of leadership we need. We need somebody in the White House right now who can actually bring the people together to get things done.

Got that? McCain and his wife were out to eat Saturday night with Joe Lieberman and his wife, instead of making sure the GOP had enough votes to pass the bailout plan. Got it?

Good.

What was Obama doing?

He was at a political rally then off, in his own words, to worry about his dry cleaning.

“It’s just trickling down a little bit here. That’s O.K. I’m going to have to get my dry cleaning going too.”

Maybe had Obama been more engaged, the 95 Democrats in the House who voted against the plan would have passed it.

How is it McCain’s fault? Seriously . . . Obama was staying in a luxury hotel, campaigning, and getting his dry cleaning done instead of working to get the Democrat votes necessary to pass the plan.

95 Democrats voted against Barack Obama’s position and it is John McCain’s fault?

I guess that is heavy starch we can believe in.

From House Republican deputy whip Eric Cantor:

And I think that this is a case of a failure of Speaker Pelosi to listen not only to her members, but certainly to our members and the common bonds that brought our members together on this very, very important issue facing the american people.  This is not a partisan crisis.  This is an economic crisis facing everyone in this country.  And to look at the votes today, 94 Democrats voted no. 94.  Now, when we were in the Majority, I think we would make a decision that we would be able to come to the floor and bring a solution to the American people and pass it.  They made a decision to leave 94 of their votes off the table and, frankly, as you can see, a majority of our votes that wouldn’t go along.  Clearly this is an instance where you see Speaker Pelosi’s failure to listen, failure to lead.

Exactly right. Nancy Pelosi and the House Democratic leadership misread the mood of their caucus and the mood of the House. The bill failed as a consequence. Despite the fact that Democrats are in the majority, Pelosi & Co. can’t count votes correctly and can’t run Congress at a time of crisis. That’s why the bailout plan failed.

In fact, some of the most basic details, including the $700 billion figure Treasury would use to buy up bad debt, are fuzzy.

“It’s not based on any particular data point,” a Treasury spokeswoman told Forbes.com Tuesday. “We just wanted to choose a really large number.”

(SOURCE)

$630 billion has been injected into the private capital markets in order to restore any lost liquidity. Of course, this causes issues with the Fed’s balance sheet but it can sell Treasury securities to make up the difference. The stock market will still go down thanks to the failure of Nancy Pelosi and House Democrats in trying to pass a bailout plan but the Fed’s injection of cash–which is nearly as large as the bailout bill’s possible price tag–should keep people calmer than they would have been without the bill.

There is nothing in the rules of the House of Representatives that says that the Speaker of the House has to be a member of the House. After Vice President Hubert Humphrey lost the 1968 Presidential election, a lot of House liberals, upset with the leadership of then-Speaker John McCormack, approached Humphrey and asked him whether he would be willing to serve as Speaker. Art. I, Sec. 2 of the Constitution merely states that “The House of Representatives shall chuse their Speaker and other Officers; and shall have the sole Power of Impeachment.”

I wonder if we can get Ben Bernanke to take up the gavel in the House. Clearly, it is too heavy for Nancy Pelosi to bear it.