Grizzled Democratic Rep. Barney Frank slapped down pretty boy GOP Rep. Eric Cantor twice in two days on national TV this week.
It was an amusing, if not so dead serious, display of superior intellect and integrity by Frank that also cut to the core of the differences between the two major parties in face of the current financial crisis, and going into the national election barely a month away.
Appearing on Wolf Blitzer’s Sunday morning “Late Edition” on CNN, the two squared off to discuss the impending $700 billion Wall Street bailout legislation that failed to pass the House Monday afternoon.
While they both generally concurred about the need for such an extreme bailout, when the conversation went to how things got so bad, Frank blamed “the terrible policy of complete deregulation that got us here.”
But then Cantor could not help but regurgitate the arch-conservative, free market mantra that blames the nation’s economic woes not on too little regulation, but too much.
He had the audacity to blame the Community Reinvestment Act of 1977, under the Carter administration, for setting the preconditions for the mortgage meltdown.
That bill, he said, “would punish banks if they did not extend credit to some un-creditworthy borrowers.”
Frank retorted, “I am very disappointed that Eric would (so) characterize efforts to prevent racial discrimination…It’s wrong. The Community Investment Act never said you had to lend to unworthy borrowers. The anti-discrimination things never said that. They said you can’t discriminate. You can’t walk away from whole neighborhoods.”
Cantor said, “It was Congress 20-some years ago that set the bar and said…we’re going to loosen underwriting guidelines for good intentions…the regulations went wild and really began to punish institutions if they weren’t able to demonstrate they had bad loans.”
“There’s terrible history here,” Frank rejoined. “Yes, the bill passed in 1977. The regulations were mostly promulgated after that by the Reagan administration…In 1994…(a Democratic-controlled-ed.) Congress told Alan Greenspan to try and have it so that credit-worthy African Americans and Hispanics and people in poor neighborhoods got it, and not others. And Greenspan, as a true conservative, said the market knows better, and I won’t do it.”
When the Republicans took control of Congress in early 1995, any talk of such regulatory reform was dashed, and, in conjunction with Greenspan, the contagion of deregulation began to escalate in Washington. It peaked in 2005 when key investment banks were cut free of any restraints on leveraging, and began selling debt for up to $40 for every $1 in base value.
This is what House Speaker Rep. Nancy Pelosi was referencing in her fiery remarks prior to the bailout vote Monday. She denounced Republican policies “built on budgetary recklessness, on an anything-goes mentality, with no regulation, no supervision, and no discipline in the system.”
Other than that one sentence, however, the rest of her remarks spoke to the need for the bill to pass, and denounced Wall Street excess.
But when the bill didn’t pass, who but Eric Cantor, the suddenly high-profiled GOP whiner, stepped to microphone waving a text of Pelosi’s remarks. Laughably, he blamed her for killing the bill because of the partisan nature of what she said.
To him, it seems, attacking deregulation is akin to attacking mother. It really gets his designer spectacles all fogged up.
Once again, it took Rep. Frank to step forward and slap-slap Cantor. “We don’t believe they had the votes, and I think they are covering up the embarrassment of not having the votes. But think about this: ‘Somebody hurt my feelings, so I will punish my country.’ I mean, that’s hardly plausible. There were 12 Republicans who were ready to stand up for the economic interest, but not if anybody insulted them!”
In his wry humor, Frank drove home the point. “I’ll make an offer. Give me those 12 people’s names, and I will go talk uncharacteristically nicely to them, and tell them what wonderful people they are, and maybe they’ll not think about the country.”
It was rumored that Cantor skulked away in search of some remnant of his lunch, which Frank had eaten.