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The Problem with Freddie Mac was the Bailout, Not Newt Gingrich

One of the more interesting examples of the Washington establishment’s hypocrisy in today’s Republican presidential campaign is the bashing of Newt Gingrich over his consulting work for Freddie Mac.

The other campaigns all know Gingrich opposed the Bush-supported bailout of Freddie Mac, and its evil twin Fannie Mae, and that Gingrich even went before a meeting of House Republicans to rally opposition to the bailout saying, “…it's an absurd bill. If a Republican administration wasn't supporting it, it wouldn't get five Republican votes.”

In particular, Congresswoman Michele Bachmann (who should have been at that 2008 meeting and has received political contributions herself from employees of Freddie Mac) seems to have conveniently forgotten Gingrich’s principled opposition to the bailout.

And what should we think about the Bush administration officials who are now supporting and advising Governor Romney who conceived of the bailout Gingrich opposed?

Those who are savaging Newt are cynically hoping voters can be convinced to forget that Gingrich opposed the bailout and they are doing everything they can to transfer voter anger about the bailout on to the former Speaker.

But in their cynical trashing of Newt Gingrich, they are all too willing to ignore the fact that there was a time -- not that long ago -- when many Republicans and conservatives thought that government should encourage citizenship and the development of strong families and a virtuous yeoman-like middle class.

The G.I. Bill, welfare reform, anti-pornography legislation, and yes, legislation to encourage home ownership through public/private partnerships as part of an “ownership society,” were all justified in pursuit of those goals, and they were very much in the Republican mainstream.

In fact, the concept of “public/private partnership” has routinely been invoked by Republicans -- such as Governor Romney -- as a way to hold-down the size and cost of government.

Yes, there was always free-market criticism of the government sponsored enterprise model, but the notion that home ownership would provide low-income families with a stable environment, an opportunity to build wealth, and an inclination to vote Republican once they had that stake in the future -- all of this was totally within the mainstream of Republican policy and political calculation.

As Newt Gingrich has risen to the top spot in the Republican presidential field, his long tenure at the center of conservative and Republican politics and policy has become one of his greatest selling points -- and as some of the policies he embraced in the past have fallen out of favor, one of his greatest liabilities. But Gingrich’s opposition to the bailout of Freddie Mac isn’t one of those cases.

Newt Gingrich was on the side of the taxpayers and conservative voters when he opposed the bailout of Fannie Mae and Freddie Mac.

And if Gingrich is wrong about the public/private partnership model for encouraging homeownership, then are Governor Romney and Representative Bachmann saying that other Republican elected officials (such as Iowa’s Governor Terry Branstad and South Carolina’s Nikki Haley, who have advocated public/private partnerships to fill various needs and provide services in their states) are also wrong?

It is a question I hope voters put to Congresswoman Bachmann, Governor Romney and other Gingrich critics, because the answer will reveal just how much of the criticism of Newt Gingrich is based on honest free market opposition to public/private partnerships and how much is pure political calculation.

Newt Gingrich courageously opposed the bailout of Freddie Mac, even when it was supported by a Republican President. If voters really want to target the guilty parties in the Freddie Mac/Fannie Mae debacle, they should be voting against Barack Obama and those Republicans and Democrats still in Congress who voted for the taxpayer-funded bailout of the failed mortgage giants -- not Newt Gingrich.


George Rasley writes for Rasley served as Special Assistant for Domestic Policy to Vice President Dan Quayle, on the staff of three of the past four Chairmen of House Republican Conference and as Director of Communications for Congressman Mac Thornberry, a senior member of the House Armed Services and Intelligence Committees.

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This article is misinformative

When Newt Gingrich was asked in the November 9 CNBC presidential debate what he did to earn $300,000 from mortgage giant Freddie Mac, Gingrich claimed: "I said to them at the time, this is a bubble. This is insane. This is impossible." But the Wall Street Journalreported December 1 that Gingrich had not only praised the Freddie Mac model in a 2007 interview on the mortgage giant's website but said that "these are results I think conservatives should embrace and want to extend as widely as possible." 

The Problem with Newt

The Problem with Newt, he contradicts himself all the time.  He is not to be trusted!

Another One

Newt is another establishment Republican that has helped lead our country down the tubes for the last decadfes. He supports the mandate and many other Obama socialisty policies. The money that Newt took was taxpayer moneyh that Freddie Macd should not have taken and it was morally werong for4 him to do so no matter how he rationalizes it. We don't need this type in our government.

Newt Conservative?

  First get rid of the "Kenyan Kommie Klown"! All the World Knows Obama was Born THERE. The Dem-Commies have pulled off the Greatest Hoax in History! Compared to Obama, Newt is Very Conservative.I like Ron Paul!  BUT -If Ron Paul runs on a 3rd Party, Obama is Guaranteed to be Re-S elected. SIEU Control of Ballot Boxes voting machines, and 30,000, 000 more votes than  Registered Voters , and  Illega lAliens voting, will assure this!

Newt was a Consultant and

As a consultant and we don't know how long he worked for the company but we do know he opposed the bailout so if nothing else that alone should be taken in to consideration before everyone belies the notion that Newt was some awful person for taking the consulting job. I know consultants make a lot of money for their services so I don't begrudge Newt one dime but I do know that as a consultant he's probably not allowed by law to give out information he may have been privy to. But we do know he opposed the bailout. He's still got my vote because I think he's the only one smart enough to stave off the insiders who have taken over our government. He'll either straighten things up or be killed by those insiders. You folks must still believe that our government lives by the laws they write and think up for us.


Newt supported TARP.

Let me remind you and anyone else reading, TARP was one of the PRIMARY reasons the Tea Party was started.

Anyone who supports a candidate that supported TARP is either Ignorant to the fact that person supported TARP, Ignorant to what the Tea Party is, or a Fraud a Fake and a Hypocrit.

I am hoping you are just misinformed and will withdraw your support for the criminal Newt.

NOT just the bailout...


The Problem with Freddie Mac was NOT just the Bailout! It can be argued that EVERYTHING about Freddie IS the problem.

Newt is a Big-Government Insider

Please stop trying to convince us that Newt is a conservative!

"Yet as recently as 2007, Gingrich was strongly in favor of the status quo when it came to Fannie Mae and Freddie Mac, and actually supported their basic structure.

“ 'The housing GSEs have made an important contribution to homeownership and the housing finance system. We have a much more liquid and stable housing finance system than we would have without the GSEs ... So while we need to improve the regulation of the GSEs, I would be very cautious about fundamentally changing their role or the model itself.' ”

"Not only did the former Speaker stress the necessity of these mortgage giants, but he also received large sums of money from them as a consultant. Just as the housing bubble was getting ready to burst, Gingrich received around $1.6 million from Freddie Mac. Although he claims that he wasn't a lobbyist, he received money from a company that was bailed out by the federal government, which means that he probably received taxpayer dollars. The hypocrisy behind these actions is just stunning."

The article continues:  "Much like Mitt Romney, Newt Gingrich has perpetuated the myth that he is a conservative, but his record says otherwise. A conservative should not sing the praises of a government run housing company. A supposed supporter of limited government should not advocate government regulation over global warming, climate change, or whatever one wishes to call it. True conservatives would not have supported the TARP bailouts, or supported an individual mandate for healthcare, both of which were the biggest issues that sparked Tea Party movement into existence."

Newt and the Toxic Twins

No I am not refering to the band areosmith. It really doesn't matter how you try to split hairs and justify Newt taking money as a private citizen from Freddie and Fannie. It is all about appearance. There is no way he can cut the chains of this off his neck. He will go down with his ship.

Nice apology piece

George you've gotta be kidding me. 

We all know the problem is the bailout and Freddie/Fannie.  However the fact remains that Taxpayers are bailing out Fannie/Freddie and Newt has taken money from Fannie/Freddie (so in esscense Newt has taken money from Taxpayers).  Just because Newt was verbally opposed to the bailouts doesn't mean he wasn't willing to profit from them.  Do you see the contradiction and conflict of interest here?  If you don't see the problem then let me give you a contrasting comparison. 

Ron Paul is opposed to the Congressional Pension Plan and has voted against it. To further support his opposition he does NOT and will NOT partake of the Congressional Pension plan. So you can see he opposes the act with his words and with his actions. 

Do you see the difference between how Ron Paul walks the walk and Newt Gingrich just says do as I say not as I do?  Talk is cheap but Gingrich is rather expensive for an historian don't you think? 

It's a question of Ethics and Decency.  When Newt is out there vocally opposing the bailouts of two institutions that should have failed, then he turns arounds and collects Million$ from these very organizations, it calls into question his ethics due to the conflict of interest.  


your article misses a very important point. If Gingrich was so busy arguing against the bailout, why would he choose to profit from FreddieMAc? What was he thinking? Was he thinking "I better profit from this before they hit the iceberg" or how about "Let me tell FreddieMac that they're doing great, and then go tell everybody else that their toxic". Either scenario does not bode well for the former disgraced speaker of the house. One shows the American people that he is a two faced liar and the other one that he didn't really care what the outcome would be as long as he filled up his pockets with money. The bailout was also a very bad move by the Government, but that doesn't make him into a good guy.