Barney Frank to Retire


NECN:

Congressman Barney Frank of Massachusetts fourth Congressional District has said he will not seek re-election for 2012.

Frank, a ranking member of the House Financial Services Committee, planned to hold a press conference in Newton, Mass. on Monday afternoon, to formally announce and answer questions on the decision.

CNN confirms.

The Caucus:

His Fourth District falls mostly in southern Massachusetts but also includes the famously liberal Boston suburbs of Newton and Brookline. Under a new redistricting plan that Gov. Deval Patrick, a fellow Democrat, signed into law last week, Mr. Frank’s district would have lost heavily Democratic city of New Bedford and gained some more conservative towns.

In February, Mr. Frank announced that he would seek re-election in 2012.

The Boston Globe:

“When Barney saw the district changed, his exact words to me were ‘They didn’t do me any favors,’” said [his last campaign manager Kevin] Sowyrda, who has remained an unofficial adviser.

“The redistricting plan was the straw that broke the camel’s back,” added Sowyrda. “I think if they left the district with New Bedford in it, you would see him running again.

Hotline:

A long line of potential Democratic successors will be looking at running, including Newton mayor Setti Warren, who dropped out of the Senate race earlier this year, state Rep. James Vallee, and state Sens. Marc Pacheco, Mike Rodrigues and James Timilty. Among Republicans, Bielat hasn’t ruled out running again. And state Rep. Jay Barrows and former Hopkinton selectman Brian Herr would also be possible GOP contenders.

Frank is the ninth House Democrat to retire outright, without seeking higher office. A total of 16 House Democrats aren’t running for re-election next year.

He’ll be 72 when he’s out, having served since 1981. Predictions are he’ll then become Professor Frank. The news conference is scheduled for 1 PM ET in Newton.

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  • RP

    At least one member of congress that was partially responsible for the housing crisis and mortgage meltdown is leaving. During the 90′s, liberals accused banks of racism resulting in blacks being rejected for loans at a much higher rate than whites. Along comes congress in 1995 and substantially changes the Community Reinvestment Act to require banks to use different standards than before which allows individuals to qualify for loans that they would not have qualified for earlier. The administration warned in 2003 that Fannie and Freddie were moving toward trouble due to loan gaurantees for those unable to meet their obligations and Barney Frank insisted many times that Fannie and Freddie were “in good shape” and “these two entities are not facing any kind of financial crisis”(Barney Frank in 2003). However, the Bush administration was blamed for the financial meltdown they had warned congress about. Those like Barney Frank ignored their warnings and continued supporting loans for the poor as they were the ones more likely to vote for a Democrat.

    Now maybe Mass. will elect someone, regardless of party, that understands financial transactions and the ability of individuals to pay off loans they take out. Barbey Frank proved incapable of this understanding.

  • dduck

    I both enjoyed him, a very intelligent man, and reviled him since he was a key to FNMA/FDMC running wild, in cahoots with Dodd.
    Bye.

  • RP

    Dduck, can you explain your comment “a very intelligent man”.

    I find it hard to comprehend him being intelligent as people with an average intelligence understands you can not have more outgoing household money than incoming household money. Had he understood this simple fact, he may have not supported that policy to give those in that condition loans for homes they could not afford and the country may have avoided the meltdown we are still in.

  • Rcoutme

    RP, where do you get your (mis)information from? Try http: //prospect.org/article/dont-blame-community-reinvestment-act or any other of a dozen articles on subprime loans. CRA loans were FIXED loans (and had about 1/6th the default rate of subprimes). The loans that qualified for CRA were not high in quantity either, since only banks and thrifts were covered under the statute. The VAST majority of failing loans were actually not even for owner-occupied purchases (it included refi’s, speculations, etc.) and they were done by MORTGAGE BROKERS! Mortgage brokers do not have access to the CRA statute, only banks and thrifts covered by the statute. That means that the CRA (statute created in 1977, btw, and expanded some in the 1990′s–so why would the crisis occur in 2006?) loans were written by the institutions that were involved.

    I have had enough of the stupidity of blaming the wrong statutes. CRA did not cause the housing bubble, nor did it lead the defaults. The CRA defaults were lower in 2006-2008 than they were in 2000. If facts mean anything to you, you must stop blaming CRA for the greed and corruption on Wall Street and by mortgage brokers.

  • Jim Satterfield

    The attitude displayed by Republicans towards the CRA is like climate change deniers or those who say evolution isn’t real. Facts never get in the way. No matter how many times an argument they make is debunked someone will come back with the same argument.

  • Allen

    I always liked Barney Frank. He is more of a social liberal than I am, but I loved to listen to him spar with people.

    I think America will be worse off without him. Be a big pair of shoes to fill.

  • CStanley

    Rcoutme and Jim- Actually the facts show a great deal of culpability of CRA policies inducing the changes in the mortgage markets which led to the bubble and inevitable collapse. It’s true that many GOP oversimplify and believe that CRA loans were directly responsible, which isn’t really the case, but the changes in lending policies and then the push for mortgage securitization and backstopping of the loans by Freddie and Fannie is what inflated the bubble.

    IMO it’s typical of the worst of our political system- because people start to believe that they can engineer income redistribution in some way that isn’t opposed by capitalists- as though they can create a perpetual motion machine in some sector of the economy. Progressives and ‘compassionate conservatives’ alike loved the idea of increasing homeownership, and the pols found a way to both coerce and entice lenders into lowering their lending standards. As time went on, coercion became less necessary because the risks were all being passed up the chain, and lenders then gamed the system by making more and more risky loans to people who had higher incomes but buying above their means or using their homes as credit cards.

    Anyway, if you doubt my assertions, here’s a pretty good summation It’s certainly true that CRA role can be overstated (and often is by GOP) but that’s no more denialism than are your assertions that CRA was insignificant. Giving the benefit of the doubt that you aren’t being intentionally partisan in seeing it that way, I assume the distinction is over whether or not securitization was the key factor- but it is wrong to ignore the reasons (politically) that securitzation happened- which largely centered around the goal of increasing CRA lending.

  • CStanley
  • Rcoutme

    Fannie and Freddie expanded their sub-prime lending AFTER they lost market share (i.e. other institutions were make many more loans in the category than Fannie and Freddie). The CEO’s of Fannie and Freddie did this as business decisions (bad ones, albeit, but not congressionally mandated) not because Barney Frank wanted to see lots of money loaned to people who could not pay it back. In addition, the loans that were MOST LIKELY to default were the ones with teaser rates (e.g. 2% for two years 7% for 28 years). The loans were written with the implied assumption that those taking out the loans would be able to refinance if they kept up the payments for the first two years.

    Of course, the refi could only go through if the housing market kept up its dizzying pace. It didn’t. Lots of homeowners were left with loans at rates that were impossible for them to pay. Fannie and Freddie do not dictate the terms of the entire mortgage industry. Actually, the one agency that could have stopped the madness instead encouraged it. That agency: Federal Reserve.

  • RP

    Rcoutme, Some information as to my source. There are other sources on the internet where Frank said Fannie and Freddie were fine.

    http://www.boston.com/bostonglobe/editorial_opinion/oped/articles/2008/09/28/franks_fingerprints_are_all_over_the_financial_fiasco/

    Maybe the Boston Globe is incorrect in its assessment. Paragraph 7 has some info on Franks position. Could be the Globe is a right wing organization and prints incorrect data concerning liberals.

  • dduck

    RP, okay maybe a wrong choice of words. So, let’s say, entertaining facile in his oratory skills.

  • roro80

    Love how a problem caused almost exclusively by filthy rich white people who didn’t think they were filthy rich enough can be blamed on lower income people and people of color. Kind of reminds me of how so many churches blame pedophilia on gay people.

    Anyway, I hope Mr Frank will enjoy his retirement into academia. He will be missed.

  • dduck

    Thanks, CS, I didn’t have the patience to reply to RC and JS. They are the deniers as are any Reps who think it was all one party or administration’s fault for facilitating the other crooks in the banking and secularization field.
    It was like showing off your wallet and diamonds to a thief and expecting him to ignore them.

  • roro80

    “It was like showing off your wallet and diamonds to a thief and expecting him to ignore them.”

    Who is the theif here?

  • dduck

    P.S., $160 billion from the taxpayer’s pocket, and still counting. And, by all means send 87 of them to Chicago’s Banker’s Conference, plus give out big bonuses, after all their predecessors made a pile mismanaging and with hardly any criticism, let alone legal action.

  • dduck

    Roro, the Bankers and Wall Street, of course, no one is denying their major roll in this mess.

  • CStanley

    roro, recognizing that much of what transpired with CRA and with the GSEs was bad policy has nothing to do with blaming ‘brown people.’ And while I haven’t specifically checked the money trail, I suspect that two particular rich white dudes (Frank and Dodd) didn’t do too badly in their personal finances and political war chests for all of their dealings with Countrywide and other financial institutions as they fought off calls for reform of the GSEs.

    For the goal of helping minorities with homeownership, an honest program directing funds to them would have been far better than this pretense of magic perpetual free money.

  • CStanley

    dduck- well, for all my efforts it looks like I’ve derailed the thread into the margins with my long URL link.

  • roro80

    Ok, got it. I thought you meant that the people signing up for these loans were the theives. In your analogy, the theives first pressured all sorts of people to carry their diamonds and cash on their person through a bad neighborhood, and lobbied the government into declairing it communism if they regulated the taking of such valuables.

  • dduck

    Love those margins…………..

  • dduck

    Lenin couldn’t have said it better, or was that Lennon, or Liz lemon on 30 Rock?

  • roro80

    CStanley — As originally conceived, the CRA I think was actually good policy. In fact, the smaller community banks it was set up to deal with in the first place did fine (well, relatively so) through the majority of the crisis. It wasn’t until it hit later stages, when the huge hit to the economy meant people who could easily afford their mortgages suddenly didn’t have jobs that these small banks had the hardest time. Most of them were making good loans, in appropriate amounts, to people who had some credit smudges or whatnot.

    The fact that the legislation was taken too far, changed from what it was meant to be — a way to get basic banking services to rural and poorer communities — into something that meant that there was no connection at all between the lending (read: commission-collecting) institution and the risk of selling the loan, doesn’t mean that the original legislation was problematic.

    It’s like the butterfly effect — no, the typhoon wouldn’t have started without that little butterfly, but it’s pretty hard to make a case that Mr. Tigerswallowtail was at fault.

  • Rcoutme

    For the record: I am not saying that Frank was not complicit in some of the most egregious behavior regarding the housing bubble (I am still split on that). I am saying that he did have something to do with it (by inaction and action). However, CRA was not meant to be a standard by which most mortgages were supposed to be created. CRA was designed to force large lending institutions to include depressed areas in their neck of the woods.

    Meanwhile, the loans that went bad during the housing bubble were not (primarily) the CRA loans. To see Mythbusters blowing up a car and hearing them tell you not to try it at home is not a manual on how all activities in automobiles should be conducted.

  • roro80

    “Lenin couldn’t have said it better, or was that Lennon, or Liz lemon on 30 Rock?”

    Oy. I’d have thought better of you — and it’s not like you’ve got a great track record with me. The idea was that the game was rigged.

  • dduck

    Aha, we agree.
    “The idea was that the game was rigged.”

  • CStanley

    roro, I mainly agree with you..I don’t know much of the detail of how the original programs functioned, so I’m not necessarily completely endorsing…but where the glaring problems came in was much later. That includes under Bush, of course, because he made it a point to try to expand homeownership even further. His goals there I’m sure were part political but also partly good intentioned IMO but he was over his head in understanding what he was putting into play (pretty much the story of his two terms IMO.)

    My main area of departure I think from the way you see things is in how innocent people like Frank were…because the degree to which he defended the GSEs for far too long can’t be excused by ignorance in his case, as far as I can see. He may well have also wanted to help increase lending to minorities and other low income people…but I think he had vested personal interest in keeping the game going too.

  • roro80

    CStanley — I can agree with that. I just look at the two players you mentioned in your comment — GWB and Frank — and it’s hard for me to square the idea that Bush had good intentions while Frank had poor ones, just based on their other actions in other areas. I don’t know if it was Bush’s explicit goal to put us where we are today — economically, socially, politically, internationally — in order to make all his buddies rich and make the rest of us eat it, which (sorry) really has been the result of his policies on the whole. He hardly could have done a better job if that were his master plan from the beginning — hell, maybe it was. Whereas I see almost everything Frank has supported as having pretty good motives; he’s been on TV enough talking and making really good points I agree with; maybe he’s full of it, but at least I agree with what he’s saying and how he votes on most issues. I tend to believe pols when they talk and when they make policy — I tend to like the words and policy from Frank and vehemently disagree with nearly everything Bush did. That’s going to color how I interpret their respective motives.

    But I suppose that’s why I’m a liberal and you’re a conservative. Which is fine. It’s just that certain groups and individuals tend to look for every reason to blame the poor and the blacks and the Mexicans and the gays for every problem, no matter how far removed, and I don’t see the focus on the CRA as much different.

  • Cannonshop

    roro80: EVERYONE thinks their intentions are good, and everyone’s opponents will tar their intentions as bad- Intention is the very soul of subjective thinking.

    Barney doesn’t want to be Ted Kennedy-I don’t blame him for that, dying in the traces might SOUND cool, but it’s usually a mark of some emptiness in your life that requires you to press on in a job regardless of whether you even WANT IT anymore.

    Mr. Frank wants his life back? great. Good for him. Means he’s figured out that being a Power sucks, and he’s tired of doing it, he wants to actually enjoy some of his life before it’s not his anymore, and while he’s still got the brain-systems working TO enjoy it, and not be a cloakroom joke trotted out on special occasions to make the Party feel like it has “Tradition” and “Statesmanship”.

  • roro80

    Cannonshop — no, I don’t think that’s true.

  • CStanley

    roro: I certainly agree that our political inclinations tend to influence the way we read motivations into the actions of politicians. I think it’s a bit more complex than that though…for instance, although I largely think GWB had good intentions but wasn’t up to the job, I have no problem seeing more cynical motivations among his advisors and administration officials (Rove, Cheney, etc..) Even there I don’t think these guys were out to run the country into a ditch…but I do think the intentions were more about political goals or personal enrichment. One example is the doubling down on CRA goals…Rove would have seen that as a way to curry favor among minorities, while GWB in my estimation would have genuinely seen it as ‘compassionate conservatism’ (and undoubtedly would have been enthusiastic about the political implications too, but not necessarily having that as the primary motivation.) I may be giving too much credit for good intentions there, but that’s always the way he came across to me…and I’m not saying I excuse the poor outcomes just because intentions were good either, it’s just my opinion.

    And maybe it’s that way with Frank too, that he genuinely believed in the policies. Either way I think there’s a major human foible at play, which is our ability to rationalize bad decisions based on our emotional desire for a certain outcome. It plays into the ways that strong ideologues often become true believers long past the time that the should realize that certain policies aren’t working or have been corrupted. But often when someone is personally benefitting and at the same time feeling that their ideology is being validated by short term benefits, they lose sight of how horribly wrong things are going to turn out.

  • dduck

    CS, you can’t be a conservative, you must be a moderate or a CINO.
    People of both parties having good intentions, wow.
    Next, you’ll be saying all on Wall Street and the bankers are not totally evil, greedy bastards.

  • CStanley

    Even worse, dduck…I don’t think Obama’s a Kenyan Communist!

  • dduck

    Roro, where are you?…………..

  • roro80

    Jeez, dduck, I do have a day job.

    CStanley, I appreciate the exchange. I of course disagree with a lot of what you say (perhaps not so much that they *meant* to run us into a ditch, but maybe just didn’t care enough about whether that’s what would happen), but that would be surprising to nobody, I’m sure. Like I said, I saw the first iterations of the CRA as good, positive policy, that actually had some good results. The fact that it was then changed and used as an excuse or an “in” to deregulating the entire financial system does not make the original policy bad. Like, I think a progressive tax rate is a good thing, but I think it would be bad if the highest marginal rate were, say, 90%, to use an extreme example. The fact that such a rate would cause lots of problems doesn’t mean you blame the original concept, or even the original rates. There’s such thing as a good idea gone so far that it becomes really bad.