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Barney Frank's Changing Views On Affordable Housing

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Just how tough it is for the Democrats as we now make our way to these much-anticipated midterm elections?

Well, even some of their most battle-tested veterans are facing tougher re-election bids this year. To wit: the Cook Political Report has now downgraded Representative Barney Frank from “safe” to “likely” Democratic, meaning his seat isn’t considered competitive at this point but has the potential to become engaged. (Hat tip: Best of the Web)

The 70-year-old Frank, should he hold onto his job, will reportedly play a pivotal role on Capitol Hill as the Obama administration prepares to tackle the future of Fannie and Freddie and to overhaul how millions of Americans are housed.

The Washington Post notes: “In taking on their next major economic challenge, senior Obama officials are scheduled to release a proposal in January that would replace the two mortgage giants and rethink federal programs that help make housing affordable.”

Greg Mankiw, professor of economics at Harvard, runs a post detailing Frank's shifting views on affordable housing and the roles of Fannie and Freddie over the course of his career.

From a news story in 2003:

The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago.

Under the plan, disclosed at a Congressional hearing today, a new agency would be created within the Treasury Department to assume supervision of Fannie Mae and Freddie Mac, the government-sponsored companies that are the two largest players in the mortgage lending industry....

Among the groups denouncing the proposal today were the National Association of Home Builders and Congressional Democrats who fear that tighter regulation of the companies could sharply reduce their commitment to financing low-income and affordable housing.

''These two entities -- Fannie Mae and Freddie Mac -- are not facing any kind of financial crisis,'' said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ''The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.''

From a news story yesterday:

In a sharp-edged debut debate, US Representative Barney Frank, a Democrat, and Sean Bielat, his Republican challenger, squared off yesterday over national security, illegal immigration, and the roots of the mortgage crisis....

Bielat, a former Marine officer from Brookline, said Frank had contributed to the downfall and subsequent recession by supporting lenient lending standards for prospective home buyers.

“He has long been an advocate for extending homeownership, even to those who couldn’t afford it, regardless of the cost to the American people,’’ said Bielat, 35.

Frank, a leading liberal who has represented the state’s Fourth Congressional District for nearly 30 years and became chairman of the House Financial Services Committee in 2007, said he and other Democrats fought to curb predatory lending practices before the recession but were thwarted by Republicans. He said he had supported efforts to help low-income families rent homes, rather than buy them.

“Low-income home ownership has been a mistake, and I have been a consistent critic of it,’’ said Frank, 70. Republicans, he said, were principally responsible for failing to reform Fannie Mae and Freddie Mac, the mortgage giants the government seized in September 2008.
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