It seems the Gingrich really did steal Christmas. According an article in the Washington Post, Newt Gingrich received between $1.6 and $1.8 million over the course of eight years to advise Freddie Mac, the government sponsored mortgage titan cum government conservatorship that’s bled the treasury for many billions of American tax dollars since the housing market bust. From the article:
Gingrich’s business relationship with Freddie Mac spanned a period of eight years. When asked at the debate what he did to earn a $300,000 payment in 2006, the former speaker said he “offered them advice on precisely what they didn’t do,” and warned the company that its lending practices were “insane.” Former Freddie Mac executives who worked with Gingrich dispute that account.
Gingrich’s first contract with the mortgage lender was in 1999, five months after he resigned from Congress and as House speaker, according to a Freddie Mac press release.
His primary contact inside the organization was Mitchell Delk, Freddie Mac’s chief lobbyist, and he was paid a self- renewing, monthly retainer of $25,000 to $30,000 between May 1999 until 2002, according to three people familiar with aspects of the business agreement.
Get that? A monthly retainer of between $25,000 and $30,000? And for what? As he says, to give them advice they refused to follow. Why might Freddie Mac wish to pay Gingrich such a princely sum? For the simple reason that Gingrich was politically powerful, and Freddie Mac depended on politically powerful people for keeping its gravy train of private profits running. The profits were the result of Freddie’s implicit backing by the federal government, which allowed it to borrow at rates only slightly higher than the government itself, while lending the money at market rates to the American citizens implicitly supporting it. Freddie, along with its kissing cousin, Fannie Mae, are the poster boys for the risk that inheres when profits are privatized while losses are socialized. They are capitalists, except without the specter of failure under which ordinary capitalists must operate.
Occupy Wall Street should march on Gingrich for having the gall to claim he took Freddie’s money for any reason other than his own enrichment. And so should all those homeowers that bought into the idea peddled by Freddie, apparently on Gingrich’s advice, that home owership was the means to stable wealth accumulation.
It seems everyone in Washington is a fraud, the life and times of Newt Gingrich being just one of the more egregious examples.