Bernanke and Bailout Barney: They Can't Hide Anymore

"The guy who was used by the forces behind Bernanke," Lyndon LaRouche said Sept. 4, "to sabotage the Homeowners and Bank Protection Act, was Barney Frank, who has the misfortune of being rushed to a [Sept. 7] debate with Rachel Brown, in which I'm sure this fact will be prominently represented, that Bernanke is incompetent."

Fed Chairman Ben Bernanke had admitted in testimony Sept. 2, that he was completely wrong about the 2007-08 crash which LaRouche, by contrast, forecast with complete and imminent accuracy in a famous July 25, 2007, webcast speech.

But it was "Bailout Barney" Frank who subsequently sabotaged the only proposed immediate remedy for that crash — LaRouche's Aug. 30, 2007, Homeowners and Bank Protection Act (HBPA) proposal.

* In September and November 2007, LPAC representatives had lengthy meetings with senior aides to Frank — supposedly the "economic expert" of the Congress — to brief them on the financial collapse underway and the HBPA solution. Frank's aides flatly insisted that there was "nothing systemic going on," that a mere subprime mortgage crisis was underway, and that no foreclosure moratorium, mortgage securities write-down, or bank reorganization such as LaRouche proposed was needed.

* In October 2007, a LaRouche Youth Movement leader in Boston, where Rachel Brown is now confronting Frank in the election, talked to Barney at a town meeting about the HBPA, and was told, "Your boss [LaRouche] is wrong. It's not a systemic crisis."

* In December 2007, the chairman of one of the key subcommittees of chairman Barney Frank's Financial Services Committee, Rep. Paul Kanjorski (D-PA), came out against LaRouche's HBPA and said he had been talking to Barney and to George Soros about it, who had warned him that it would decimate the entire $60 trillion credit default derivatives market.

* In January 2008, by which time hundreds of state legislatures and city councils across the country had voted to demand HBPA from the Congress, Barney Frank gave a political talk at Goucher College in Maryland. When an LPAC representative raised the HBPA, Barney said it was "completely unconstitutional," and that he would "be acting to make sure that it is not put forward in the Congress." Barney said that the "right to foreclose" had Constitutional protection! Also at that time, Sen. Charles Schumer (D-NY), asked about HBPA in an event in Washington, D.C., repeated the claim that "the Constitution doesn't allow a halting of all foreclosures."

* In late July 2008, having just gotten through the House the Dodd-Frank massive mortgage bailout known as the nationalization of Fannie Mae and Freddie Mac, Frank told his committee, "Another [way] would have been an effort to legislatively say 'no' to foreclosures. Some advocate that [only the LaRouche Political Action Committee and its backers in localities around the country had proposed it], but I think it has Constitutional problems. I think it also has problems in how you discriminate which foreclosures should go forward and which shouldn't."

Some 7.5 million home foreclosures have "gone forward" since then, with Barney's protection.

* During the course of Fall 2008, Frank drafted and got passed "mortgage modification" legislation in the House, his direct counter to the HPBA legislation he had kept out of the Congress. Early in the process, the Washington Post of July 29 exposed that the draft design for Barney's bill had been done at Credit Suisse bank. This legislation, whose name and conditions kept changing but was eventually, officially called the Help for Homeowners Act of 2008, was a complete — intentional? — failure. By the Spring of 2009 it had modified a grand total of 41 mortgages nationwide while 600,000 households had quickly lost their homes; Frank himself then admitted it was a failure and instead backed President Obama's Home Affordable Mortgage Program (HAMP). That program has been declared a failure at stopping foreclosures by every committee or agency that has studied its effects.