Barney Frank (D-MA) and Finance – Latest Political Peccadillo with Yet another Failed Institution Brought to Light.

Frank and Paulson image Politico

Barney Frank, (D-MA) the House Committee on Financial Services is apparently responsible for using his influence to prop up yet another failed institution with taxpayers dollars. Frank, who is up for reelection in 2010, is best known for his association and support of Fannie Mae and Freddie Mac, the federal lending giants, who were, in a greater part, responsible for the current financial crisis.

In 2003, several Congressional Representatives and Senators were concerned about the stability of those two institutions, and had called for a review, Frank, who was, at the time merely the ranking Democrat on the Finance Committee, appeared to feel all was well with the lenders: see excerpt here from the New York Times Business Section:

Freddie Mac, whose accounting is under investigation by the Securities and Exchange Commission and a United States attorney in Virginia, issued a statement calling the administration plan a ''responsible proposal.''
The stocks of Freddie Mac and Fannie Mae fell while the prices of their bonds generally rose. Shares of Freddie Mac fell $2.04, or 3.7 percent, to $53.40, while Fannie Mae was down $1.62, or 2.4 percent, to $66.74. The price of a Fannie Mae bond due in March 2013 rose to 97.337 from 96.525.Its yield fell to 4.726 percent from 4.835 percent on Tuesday.
Fannie Mae, which was previously known as the Federal National Mortgage Association, and Freddie Mac, which was the Federal Home Loan Mortgage Corporation, have been criticized by rivals for exerting too much influence over their regulators.
''The regulator has not only been outmanned, it has been outlobbied,'' said Representative Richard H. Baker, the Louisiana Republican who has proposed legislation similar to the administration proposal and who leads a subcommittee that oversees the companies. ''Being underfunded does not explain how a glowing report of Freddie's operations was released only hours before the managerial upheaval that followed. This is not world-class regulatory work.''
Significant details must still be worked out before Congress can approve a bill. Among the groups denouncing the proposal today were the National Association of Home Builders and Congressional Democrats who fear that tighter regulation of the companies could sharply reduce their commitment to financing low-income and affordable housing.
''These two entities -- Fannie Mae and Freddie Mac -- are not facing any kind of financial crisis,'' said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ''The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.''

One should also note that Frank recently received a reelection bid endorsement from Bank of America president, Chief Executive Officer Brian Moynihan. In a recent article from the Financial Times, Frank had asked four banks (Bank of America included) to modify their lending practices and write down second tier mortgages, in other words, take a loss, “in order to save U.S. Housing. This was in March of 2010.

With his hands in every nook and cranny of the financial industry, Frank is now facing some scrutiny over a direct intervention with then Treasury Secretary Paulson, to save a failed bank in his district. Although one might argue that the Congressman was doing his job by taking care of an industry specific to the 4th Congressional District, emails and documents obtained under the Freedom of Information Act by the watchdog group Judicial Watchsuggests otherwise.

First, the bank did not meet criteria to be included in the program, it was under an Cease and Desist order: (From www.fdic.gov/bank/individual/enforcemnet/2008-10-09)

OneUnited Bank, Boston, Massachusetts ("Bank") and its institution-affiliated parties, as that term is defined in section 3(u) of the Federal Deposit Insurance Act (“Act”), 12 U.S.C. § 1813(u), and its successors and assignees having been advised of its right to a Notice of Charges and of Hearing detailing the unsafe or unsound banking practices and violations of law alleged to have been committed by the Bank and of its right to a hearing on such alleged charges under section 8(b)(1) of the Act, and having waived those rights, entered into a STIPULATION AND CONSENT TO THE ISSUANCE OF AN ORDER TO CEASE AND DESIST ("CONSENT AGREEMENT") with counsel for the Federal Deposit Insurance Corporation ("FDIC") and the Commonwealth of Massachusetts
The FDIC and the Division considered the matter and determined that it had reason to believe that the Bank had engaged in unsafe or unsound banking practices and violations of law. The FDIC and the Division, therefore, accepted the CONSENT AGREEMENT and issued the following:
ORDER TO CEASE AND DESIST



Apparently, Barney Frank brought pressure to bear on the Treasury in order to allow OneUnited to receive Tarp Funds. Frank, not alone in this endeavor was joined by Congressional Representative Maxine Waters (D-CA), whose husband was affiliated with that institution. Both Frank and Senator John Kerry (D-MA) were mentioned in documents obtained by Judicial Watch.

Accountability and elementary accounting practices appear to have gone missing from the Chairman of the Committee that oversees Banking and Finance for the nation. That said, what one can expect to come out of this particular brouhaha is yet another “Charlie Rangel” – by that, individuals who have committed dubious acts, even scandalous acts, who have managed to hold onto their Committee Chairs and seats, by virtue of the insanity that pervades in the Capital. It took decades before Rangel was held somewhat accountable, therefore, one can expect Frank to continue to skate, with the help of Pelosi and Company – unless and until Frank is no longer eligible to sit on a Committee that has, perhaps the greatest impact on our economy. The only way to permanently ensure that Frank can no longer be an influence is to effectively remove him from office via the ballot box. To allow him to remain in office, only puts his Chairmanship on hold – (assuming the Congress changes political power hands in 2010), he would still be sitting on that Committee.

The power of the ballot must be brought to bear in order to permanently remove Frank from the vicinity of the House Committee on Financial Services by the 4th District voters themselves, electing an alternative to Frank. A new radio commercial from the Sholley for Congress Campaign hits the nail on the head (see YouTube video below). It is imperative that the citizens of the 4th Congressional District get to know Mr. Frank and his impact on the nation – to learn more about voting in Massachusetts visit the Massachusetts Secretary of State’s website on Elections.

Of Car Dealerships and Pacemakers – Federal Government Priority Drives Health Device Industry Down Props Up Car Dealerships

Richard Neal (D-MA) far left - takes credit for reinstating Car Dealership - GM of course - photo credit: Springfield Mass. Republican

Western Massachusetts – Two articles which appeared in the Springfield Republican, highlight the disparity in the Federal Governments commitment to job development vis a vis the nationalizing of private industry in the United States. On one hand, General Motors, a government owned entity, has recently reinstated a local car dealership which had been closed during the takeover. Richard Neal (D-MA – Hamden 2nd), was featured in an article where he takes responsibility for reinstating local car dealership, Bob Pion Pontiac in Chicopee. The article begins: “After prodding from U.S. Rep. Richard E. Neal, D-Springfield, General Motors Corp. reversed course and has reinstated Bob Pion as a Buick and GMC dealer.”, and goes on to describe how the dealership lost its status during the government “bail-out” in January. The article goes on to point out: “Pion kept the dealership going with the service department and by buying used cars at auction to sell, Donald Pion said. He has 32 employees and annual payroll of $1.4 million.

Neal, a member of the powerful House Ways & Means Committee, said he met with GM executives and asked them to review Pion’s sales statistics and profitability.”

Based on the figures include in the piece, assuming this dealership is representative of the other 1300 plus which were closed in the bailout, approximately 43,000 jobs were endangered or lost when the Government took control of the auto industry. The fact that a Congressman has the power to reinstate a specific business is chilling in that it becomes a question of human nature and the whim of a particular congressional representative and/or the fact that an election year is at hand.

On the flip side, businesses are preparing for the heavy negative impact brought about by the recently passed health care legislation. On a national level, large employers who have filed anticipated losses due to the legislation, an anticipated one billion dollars in losses which will impact hiring as well as eventually result in layoffs. Firms such as Caterpillar, AT&T, and Deer and Company are on the top of the list, however, other firms, such as those involved in the Medical Device Industry, which are smaller in scope, are also seeing immediate impacts from health care reform taxes.

In the same week, the Springfield Republican ran an article regarding the loss of revenue to the Medical Device Industry in Massachusetts. In Massachusetts alone, the industry directly employs 21,000 individuals, while smaller industry that manufacture parts for these devices employee an additional 29,000. Neal, featured in this article due to his support and yes vote on the Health Care Reform Act, apparently feels that an excise tax on an industry that is critical to the health and welfare of millions of people (Medical devise manufactures make everything from pacemakers to hip implants), was lucky to pay a smaller tax than originally proposed by the Bay State congressman. In the same city as the auto dealership the featured firm employs 200 individuals, and placed any expansion plans on hold indefinitely.

Neal’s response to Senator Scott Brown (R-M)’s legislation to repeal the Health Care Reform in order to save businesses such as medical device manufactures: :”Neal challenged Brown to find another way to pay for the reforms.”

The message Richard Neal (and his like minded cohorts in D.C.) is sending to his constituents: More Cars, fewer pacemakers! Save 32 jobs, lose 200! Perhaps if the Government takes over the medical device industry once it goes bankrupt, Neal will be on hand to reinstate that concern, unless of course, he is not re-elected in 2010.

Someone should point out to Rep. Neal that the loss of an industry due to legislation will result in less income for the Federal Government, which it needs to pay for all of this - lost jobs equal losses in tax revenue. A situation which the taxed to smithereens Massachusetts residents and businesses were well acquainted with before the Health Care plan was exported nationally.

A video found on Hillbuzz.org sums up the continuing angst felt by the general public when they see articles such as these:

South Hadley, MA Teen Indictments in Prince Suicide Case – What of the school teachers and administrators? Opinion

The Town of South Hadley has been the focus of national attention this past week over indictments against six teenagers who were accused of bullying a fellow student into committing suicide. What is missing from the indictments are the teachers and administrators of the School who allowed the bullying to continue. It was noted in an article from the Springfield Republican that “No charges were brought against any school officials, although Northwest District Attorney Elizabeth Scheibel said most of the student body, faculty members and administrators knew Prince was being bullied over a four-month period.”

In addition, the mother of Ms. Prince had sought help from school officials on several occasions with no results. The City and School Boards, like many public schools across the nation, have stepped up to the plate, by bringing in experts on bullying, implementing non-bullying rules at school, and pushing for anti-bullying legislation. This is akin to the United States going hat in hand to the UN Security Council asking for sanctions against Iran.

There have always been bullies, individuals who, for whatever psychological reason, feel the need to demean and physically abuse students who have less physical strength. In the past (40 years ago), victims were told to find ways to fight back, or, if the bully was overly aggressive, they ended up in what was then known as “reform school”. Teachers had the ability to haul the bully off the playground or out of class - of course, today, that teacher would be slapped with a lawsuit, and being sent to the principal’s office would involve the teacher not the student who was in the wrong. In other words, for the past few decades, the student body has been allowed to “run amok”, either due to apathy or a fear of lawsuits brought against the school systems by parents who could not conceive of their child being in the wrong, under any circumstances.

Case in point, The New York Daily News, reporting on the South Hadley incident, found one mother of a teen that was name in the indictment blaming the victim!” Go figure.

One has to ask, however, what would have taken place had these same students been enrolled in a private school (parochial or other) that has parents who are engaged and teachers and administrators who do not put up with any nonsense - period. The fact that order and discipline are part of the process in most private schools (not to say that bullying and name calling do not take place), allows teachers and administrators to deal directly with the student and parents – they employ the art of detention and suspend students for bad behavior – not unlike the public schools of bygone eras.

Had the school officials stepped in and stopped the incidents on school grounds, and after being begged by that parent for help, had called the students in question into the “wood shed” and offered them the option of either knocking it off or facing detention and suspension, would the situation have changed? Perhaps the young woman would still have been harassed outside of school – due to having a relationship with the Captain of the Football team, who must have immediately told his playmates about the conquest, and the matter snowballed. The fact that the young woman (14) had been called as slut, is included in the article from the Republican, is not germane.

Why, unfortunately, the society of public schools and the permissive attitude towards casual sex has made casual sex acceptable - therefore, can the girl be called a slut, when the school openly provides condoms for students encouraging risky behavior? What of the girls that were harassing the younger student are they not sluts as well? (The Football Captain who is being charged with statutory rape, had a relationship with one of the girls being charged with stalking – therefore, it breaks down to that young woman’s decision to have a “relationship”, ensuing jealousy, and the resulting harassment of the young woman, who was merely doing what “everyone else” was doing at that school and at schools across the country - having casual sex, i.e. being a slut) – A return to the attitudes of the 1960’s and 1970’s might be in order. If one were to have engaged in a casual sex in that era, there were called a slut, and that was a moniker that no-one wanted to bear. Of course there were still football captains and cheerleaders and the unfortunate incidents of girls being called “sluts”, but it did not result in stalking or abuses both inside and outside the school. The teachers and principals would have stepped in, admonishing those who harassed and most likely calling the individual (victim) a slut. Parents also respected the school's decisions, which would have led to more penalties for the "harassers" at home.

Now the tragedy has evolved to a multi-level play where there is no possible good outcome. Ms. Prince took her own life, yet no-one saw signs of depression and or stepped into get her counseling in order to prevent the situation – Apparently, not one student, or guidance councilor or teacher approached Ms. Snow to give her advice. Not one teacher or administrator took steps to stop the harassment taking place in school for a period of four months, and not one parent is ready to accept the fact that their child is guilty of going beyond the boundaries of reality – of course, it is most likely that the parents of the students charged only became aware of the fact once the indictments were handed down. Now, the school is off the hook, (so far), the young woman’s life was cut short as she received no psychological help to deal with the situation at hand. At least six students lives are in a shambles because the behavior was given a pass and virtually deemed appropriate by those same school teachers and administrators. The charge of statutory rape will carry a lifelong stamp of sexual offender, and the real possibility of prison instead of college awaits those students charged. The parents will be forced to empty their life savings, mortgage a home, put retirement aside and end up in penury in order to adequately defend their children. Criminal defense attorneys do not come cheap. However, the school officials and teachers will literally skate backed by the union label that will protect and defend, even if chargers are brought to bear – which is doubtful.

It boils down to a lack of personal responsibility on the part of everyone concerned - and it is about time that the focus on education in this nation include a course on behavior, with consequences for those students who do not follow school rules, regardless of threats of frivolous lawsuits by parents blinded by the glory of the offspring they have created. In that event, this case should be used as an example of what could happen to everyone involved. Perhaps the public sector might want to take a clue from some of the parochial schools and the modus they employ to encourage respect of the student, the student body and the teachers. One also wonders where the union is in all of this. Would it not be in the best interest of the union body to make sure that teachers receive the respect they are due? They are most likely finding the lawyers that make sure the teachers are left blameless in this incident.