Obama in the middle of the Mortgage Scandal

It is becoming known, more and more, that the individuals who were largely responsible for the wallstreet deregulation plan / scandal under President Clinton, Mr. Summers and Mr. Rubin, are a part of the economic advising group connected with the Obama campaign. In other words, these same folks are molding and shaping the Obama perspective on the economy. What the rest of us are also learning is that Obama has more of a connection to the fiasco that is Fannie Mae and Freddie Mac.

Obama is Seeking the Advice of Fannie Mae Leadership Who are Involved in Mortgage and Financial Scandals?

The Washington Post did an interview with Franklin Raines, now in the press for receiving notoriously supersized-paychecks totally $90,000,000 for five years of work as the CEO of Fannie Mae. Raines claimed to have helped along the early days of the Obama campaign who went seeking his advice on “mortgage and policy matters.” Raines was one of three individuals providing leadership for Fannie Mae that are now involved in mortgage-related financial scandals.

In the details, the Associated Press reported that Raines, in an Enron-like scandal, and several other Fannie Mae top executives were ordered to pay nearly $31.4 million as the result of a civil lawsuit for manipulating Fannie Mae earnings so that they would receive additional pay bonuses (sound like Enron all over again?)

While is seems clear that Raines does not sit in a formal position in the Obama campaign, it is disconcerting to imagine that these are the types of people Obama advisors are reaching out to for advice. I thought it was a value of Obama to clean up such behavior in Washington, rather than reach out to it for advice?

Obama is the Second Highest Fannie Mae and Freddy Mac Recipient of Campaign Contributions?

It is no surprise then to imagine that Obama is found in the top 25 politicians to receive campaign contributions by these organizations. Of the top twenty five politicians to receive contributions, Obama ranks second from the top, behind only Christopher Dodd, the Democrat from the state of Connecticut. To be fair John McCain also received contributions. They totaled less than $21,000.

Republicans in Congress like John McCain tried to fix Fannie Mae and Freddy Mac in 2005?

As evidenced by the Federal Housing Enterprise Regulatory Reform Act of 2005, Congressional House Republicans have made attempts to fix the problems with these organizations. The bill never even came up for vote in the Senate. There is plenty of speculation as to why it didn’t come up for vote, but there isn’t a lot of understanding as to why it did not happen. What is notable is that McCain, a co-author of the Federal Enterprise Regulatory Reform Act legislation in 2005 said at that time, "For years I have been concerned about the regulatory structure that governs Fannie Mae and Freddie Mac – known as government-sponsored entities or GSEs – and the sheer magnitude of these companies and the role they play in the housing market…"

As fact-checking goes these historical revelations seem to upset the accusations of the Obama campaign to connect McCain with the deregulation of Fannie Mae and Freddie Mac. It ends up that Obama has a greater conflict of interest and connection with this scandal than McCain. If you are still looking for change in America, it seems that McCain actually has a track record of seeking the kind of change that Obama talks about on one hand, but doesn’t seem to back up in the details of his Washington, DC dealings.