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Who Put the House on Fire? (Update: Arsonist Speaks)

John on September 29, 2008 at 8:20 am

Yesterday, Congressman and former Clinton cronie Rahm Emanuel stepped in front of the microphones to talk about the bailout deal. He issued a well-rehearsed statement, complete with catchy phrases (“flippin ‘em like pancakes”) and rhyming couplets (“regulators on the street like cops on the beat”). Then he said that this financial crisis was not a natural disaster. The house was on fire and it was time to find out who the arsonist was (at 3:00 minutes in):

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No surprise, Emanuel says eight years of deregulation are the problem. This is now a Democratic talking point, one clearly designed to protect themselves and bolster the claims of their candidate for President who accepted a lot of Fannie lobbying money. But as I’ve pointed out here and here and here, it’s just not true that deregulation is at fault. If you want to know who the arsonist was, look no further than Barney Frank, Chris Dodd and the Congressional Black Caucus.

Over at Hot Air, Ed has a video that’s very enlightening in this regard. It comes from 2004, shortly after the President’s attempt to reform oversight of Fannie and Freddie. Please click over and watch as Republicans call for new regulation and Democrats excoriate any attempt to do so. Franklin Raines, then the head of Fannie, was eventually ushered out for fraud and narrowly escaped charges for his bookkeeping methods.

The Democrats are engaging in a campaign of intentional disinformation. But the record is clear. Democrats were the arsonists. They should be held accountable.

Update 3PM: The chief arsonist speaks! Barney Frank told the Boston Herald yesterday:

Frank told the Herald yesterday that “in 2003, nobody that I knew of foresaw the crisis of subprime lending, and that is what caused this problem.”

Apparently he didn’t know the President or the Republican members of the committee who all foresaw it at the time.

Update 9/30: One more tidbit to add. Rahm Emanuel is a former board member of Freddie Mac and is working behind the scenes to make sure the significant role of the Clinton administration in all of this is never investigated:

according to House Oversight Committee staff, Emanuel has received assurances from Pelosi that she will not allow what he termed a “witch hunt” to take place during the next Congressional session over the role Fannie Mae and Freddie Mac played in the economic crisis.

Emanuel apparently is concerned the roles former Clinton Administration members may have played in the mortgage industry collapse could be politically — or worse, if the Department of Justice had its way, legally — treacherous for many.

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