September 26, 2004
WHAT'S THE REPUBLICAN ENRON?:
FANNIE MAE SCANDAL IS DEMOCRATS' ENRON (TERRY KEENAN, September 26, 2004, NY Post)
IS the growing scandal at Fannie Mae about to become the Democrats' Enron?That's the hot question in Washington this week as regulators painted a scary picture of the huge home lender, detailing accounting shenanigans, including "cookie jar" reserves that smoothed out volatile results and paved the way for tens of millions of dollars in executive bonuses.
For those, including Alan Greenspan, who have warned that this government-sponsored lender is a ticking time bomb, the revelations seem to indicate that Fannie's own management believed its operations are a lot riskier than they let on.
That's just one reason this story has Washington and Wall Street buzzing. There are many others — starting with Fannie's chairman and CEO Franklin Raines.
Raines is not your average CEO, mind you. The Harvard educated exec, who pocketed $20 million from Fannie Mae last year, is just one of a handful of Democrats who easily bridges the Washington-New York power axis.
Raines was widely believed to be Senator John Kerry's first choice for Treasury Secretary in a Kerry administration, and was even mentioned as a potential Kerry running mate.
So, if, as Paul Krugman assures us, Enron is destined to be a bigger story than 9-11 and Fannie Mae is a bigger scandal than Enron it must be the biggest story since the Virgin Birth, eh? Posted by Orrin Judd at September 26, 2004 10:54 AM
Rest assured, no one from the MSM will write about Franklin Raines (other than the Journal, which has been pursuing this story for probably 3 years).
But he will never get a government job now. His board is probably going to dump him, once their own number is purged (the chairwoman of Xerox quit the FNMA board last Tuesday).
And I'll bet there's a 50-50 chance Krugman was on Fannie's payroll in the past 5 years, just like he was at Enron.
Posted by: jim hamlen at September 26, 2004 1:09 PMI'm not generally one for salary caps, but how the #@$!& does someone who basically works for the government make $20 million a year?
Posted by: PapayaSF at September 26, 2004 2:15 PMWhy shouldn't the Enron scandal be regarded as the Democrats' Enron. The illegal conduct occurred during the Clinton Administration.
Posted by: George at September 26, 2004 3:07 PMWhy shouldn't the Enron scandal be regarded as the Democrats' Enron? The illegal conduct occurred during the Clinton Administration.
Posted by: George at September 26, 2004 3:07 PMI believe Jamie Gorelick, had a role there, between stints as Reno's terror facilitator,
9-11 commissioner, and Saudi minion, at Wilmer
Cutler Pickering
True enough: Gorelick is just a younger (and more venal) version of Clark Clifford.
Posted by: jim hamlen at September 26, 2004 3:53 PM"Jamie Gorelick's career has spanned the legal, policy, and corporate landscape. Immediately before joining the firm, she was Vice Chair of Fannie Mae, the nation's largest source of housing finance. There, she shared responsibility for the overall management of the company, with a special emphasis on affordable housing. She oversaw the legal, regulatory, and external affairs of the company."
Posted by: Robert Schwartz at September 26, 2004 9:22 PMDon't You just love Google.
Posted by: Robert Schwartz at September 26, 2004 9:24 PM