Back to Barney

Not that Barney.  No, the Barney Frank profile in the New Yorker mentioned earlier.

Frank Rich has an op-ed today about the gradual acceptance of same-sex marriage which polls genius, Nate Silver, sees as receiving majority support sometime next year.  It wasn't always thus, of course.  Memories of thuggish discrimination are still raw.  Barney Frank, member of the House as far back as 1986, told Speaker Tip O'Neill that he was gay.

In 1986, Frank approached Tip O’Neill on the House floor to tell him that a forthcoming book would refer to Frank as a gay man. “He said, ‘Oh, Barney, don’t listen to that crap,’ ” Frank recalled. “They say stuff like that about all of us.’ I said, ‘Well, Tip, it’s true.’ And he sort of slumped in his chair and said, ‘Oh, Barney, I’m so sad. I thought you might be the first Jewish Speaker.’ ” (O’Neill, who had little facility for contemporary slang, prepared his staffers by saying that Frank had decided to “come out of the room.”) Two decades later, Frank’s ascendancy in Congress suggests that O’Neill had too little faith in Frank—and in the ability of the country to change.

Jeffrey Toobin's profile of Barney Frank is full of little revelations and clarifications about a period (and two presidential candidates) that's gotten lost in the rush forward.  Take for example former Treasury Secretary Henry Paulson's flat panic about what was happening to the economy last September and that same Goldman Sachs autocrat's dogged unwillingness to disclose where the Treasury would be spending our money.  Even worse was "Hank" Paulson's blatant rejection of giving any consideration to people being thrown out of their homes.  Instead, the government would endow AIG and kin with  the entire winner's purse. 

Congress' panic and Paulson's bastardy are now laid out quite clearly.  Remember all this stuff?

On the evening of Thursday, September 18th, during one of the most tumultuous weeks in American economic history, Frank was summoned to an emergency meeting in the office of Nancy Pelosi. That Monday, the federal government had declined to intercede as Lehman Brothers, the investment-banking firm, declared bankruptcy. But the following day the Federal Reserve provided American International Group, the insurance company, with a bailout worth eighty-five billion dollars, to prevent it from going out of business. Many in Congress viewed these developments with alarm.

“On that Thursday afternoon, I was meeting with my leadership, and I realized I had not heard from Hank Paulson”—the Treasury Secretary—“that day about the markets,” Pelosi told me. “So, because the situation was looking chaotic, I called Hank and said I wanted him to come in the following morning at 9 A.M. with Ben Bernanke”—the chairman of the Federal Reserve—“to brief me and the whole Democratic leadership. I reached him at about 3 P.M., and he said tomorrow morning might be too late. He had to come by that night.”

Pelosi asked Frank and a bipartisan group of senators and representatives to meet with the Administration officials in her office. “That evening, when we met with them, they painted a very dismal picture,” Pelosi continued. “They said if we don’t act now we may not have an economy on Monday night.”

The Democrats in Congress didn't like this at all.  But once Paulson got away with it, as we know now, it didn't matter whether there was a new president or a "new"  Treasury Secretary.  Bank bailouts and government opacity were embedded in the process.

Frank laid out the provisions that the Democrats wanted in a bailout bill: equity for the taxpayers, like any other investors; a program to limit foreclosures for beleaguered homeowners; compensation reform for executives at companies receiving bailout funds; and strict congressional oversight of the whole process. Two days later, on Saturday, September 20th, the Treasury Department sent Congress a formal proposal of sorts. In a text just three pages long, the Treasury asked for seven hundred billion dollars from Congress but provided few details about how the Administration would spend the money. “It was just ridiculous,” Pelosi told me. “They wanted us to surrender all authority and give them seven hundred billion dollars.”

Then there's that memorable moment when a weasely presidential candidate, John McCain, declared that his country needed him.  In late September of  '08, he suspended his campaign and flew to Washington to straighten out the economic mess (in mufti, but pretending he was wearing his Superman cape).

Although McCain had played no part in the negotiations, the White House promptly scheduled a meeting of the President, the congressional leadership, and the two Presidential candidates for the following afternoon, Thursday, September 25th. By this time, a deal seemed to be in place. Congressional leaders announced that they had agreed in principle to an amended version of the Administration’s bailout proposal. Before the meeting, the Democrats at the White House, including Frank, Pelosi, and Barack Obama, had caucused privately in the Roosevelt Room about their strategy for the day. “Barack said, ‘I think we need to go ahead with this,’ ” Frank recalled. “He was being conciliatory, because he thinks it’s very important for us, both in public policy and politically, that we don’t get blamed for fucking up the economy. And that we not fuck up the economy.”

The meeting with the President nearly destroyed the good will that had been generated during the previous week. John Boehner, the Republican leader in the House, expressed disapproval of the proposal, arguing that it did not reflect a bipartisan consensus. Frank tried to put McCain on the spot: would he back the House Republicans or Bush and the rest of the congressional leadership? As Frank recalled, “I said, ‘John, what do you think?’ ‘Well, I think the House Republicans have a right to their position.’ ‘Fine. You agree with that position?’ ‘No, I just think they have a right to their position.’ He looks like your old uncle, just shrivelled and shrunk, and he just didn’t look good. And we kept pressing him, saying, ‘What is your plan?’ ” McCain wouldn’t say.

Barney Frank believes the kind of "conservatism" the country has suffered through since the Reagan years has done itself in.  Dio volente.

In October, he began holding hearings on how to transform the laws that govern banks and financial-services companies, with the goal of reforming the system so that the current crisis will not recur. “We are at a moment now when liberalism is poised to have its biggest impact on America since Roosevelt, because the conservative viewpoint has been so thoroughly repudiated by reality,” Frank said. “Someone asked Harold Macmillan what has the most impact on political decisions. He said, ‘Events, dear boy, events.’ Events have just totally repudiated them, and we’re now in a position to take advantage of that.” He went on, “You know Hegel. Thesis: No regulation at all. Antithesis: Now the government owns the banks. What I gotta do next year is the synthesis.”