Obama's new chief of staff Rahm Emanuel on Freddie Mac board during scandal

Well, (some of) the media remembered how to investigate. RE: Rahm Emanuel’s time on the Freddie Mac board, ABC reports:

President-elect Barack Obama’s newly appointed chief of staff, Rahm Emanuel, served on the board of directors of the federal mortgage firm Freddie Mac at a time when scandal was brewing at the troubled agency and the board failed to spot “red flags,” according to government reports reviewed by ABCNews.com.
President-elect Barack Obama’s newly appointed chief of staff, Rahm Emanuel, served on the board of directors of the federal mortgage firm Freddie Mac at a time when scandal was brewing at the troubled agency and the board failed to spot “red flags,” according to government reports reviewed by ABCNews.com. According to a complaint later filed by the Securities and Exchange Commission, Freddie Mac, known formally as the Federal Home Loan Mortgage Corporation, misreported profits by billions of dollars in order to deceive investors between the years 2000 and 2002.
Emanuel was not named in the SEC complaint but the entire board was later accused by the Office of Federal Housing Enterprise Oversight (OFHEO) of having “failed in its duty to follow up on matters brought to its attention.”

When (if) the MSM report this story in depth, it will report that some in the GOP saw the problems early on but were blocked by the Democrats in leadership. I am looking for primary sources on this but a number of bloggers report that Emanuel blocked efforts to reform Freddie and Fannie. In 2006, Dems (who had won control of the Congress) were identified as standing in the way of reform:

Democrats are likely to block a Republican proposal to cut the $1.4 trillion combined mortgage assets of Fannie Mae and Freddie Mac. Republicans have pushed to scale back the investments of the government-chartered mortgage companies, arguing the holdings are so large they threaten to destabilize financial markets.
Frank’s View
Massachusetts Representative Barney Frank, who is in line to chair the House Financial Services Committee, said discussions with Treasury Secretary Hank Paulson may still produce a deal.
Any measure would have to include an increase in the share of profits the two mortgage giants must donate to a fund to help low-income people buy housing, Frank said in an Oct. 31 interview. “I am going to get as much as I can,” he said.
Frank also says he plans to push legislation to give company shareholders more power to review stock options and other bonuses for corporate executives.

The irony is that the recent banking/credit crisis derailed the McCain campaign and played a large role in the election outcome. The roots of the current bailout apparently go back at least to the Congressional transition in 2006 when Barney Frank held off a deal on Freddie and Fannie in order to give money to finance low income housing purchases (read: ACORN Housing, and other ways to finance home purchases, many of which were risky loans). And recall, that the first bailout package offered up by the Frank-Dodd-Paulson group included the same kind of mechanism, funneling money to support risky deals. Barney Frank said, “I’m going to get all I can.” And now the Dems have done a very skillful job of convincing many that the credit crisis was none of their doing.

There are a lotta very rich people out there…

Economics with Barney Frank:

Wow, makes you want to be rich. The hyper-rich won’t miss half of their billions but after awhile the many of those rich people making over $250k might not be so rich.
The Bush finance team wants a bigger “stimulus package” . Frank is apparently agreeing here. When will we just say no?

Democrats blocked reform of Freddie and Fannie; Received most money from Freddie and Fannie

The financial crisis is being labeled by all concerned as the most serious crisis since the Great Depression. People on the street, myself included, are scrambling to figure this out. Now Democrats are calling for more regulation of financial institutions. However, in the recent past, they blocked such regulations despite calls from the Bush administration, Alan Greenspan and John McCain. Watch this FOX News report for details.

Now examine the contributions of Fannie Mae and Freddie Mac to politicians. Senate Banking Committee Chair Chris Dodd leads the way. He also didn’t want McCain to come to town and mess up the deal he helped construct for the bailout.
The top four receivers of contribution were:

1. Dodd, Christopher J. (D-CT) $133,900
2. Kerry, John (D-MA) $111,000
3. Obama, Barack (D-IL) $105,849
4. Clinton, Hillary (D-NY) $75,550

Now I know John McCain’s campaign manager lobbied for Freddie and Fannie but it is clear that this role by Rick Davis did not prevent Sen. McCain from calling for more oversight. Forgive me if I am less than trusting of a Democratically controlled Congress speeding a rescue package through. I believe the answer has to be a bi-partisan effort but I also am skeptical that the one’s who have been saying everything is fine should be the one’s leading the charge.
See also Bill Clinton’s confirmation that the Democrats stonewalled regulation.