RUSH: Barney Frank invoked my name on the floor of the House. It was last night on the House floor, and Barney Frank talking about foreclosures and me.
FRANK: There is, for instance, a noted commentator on public affairs, Mr. Limbaugh, who has a certain number of fans on that side, and if they aren’t fans, they’re afraid to say so. He has asked that the president fail. Well, the effect of this amendment would give Mr. Limbaugh his wish, because if you cripple the effort to reduce mortgage foreclosure, you cripple the effort to get out of the economic slump we are in. So I understand what some people would like to see happen, they do not want President Obama and a Democratic Congress to get any credit for helping to reduce our economic situation. They’re taking a lot of innocent people hostage.
RUSH: Well, that’s the most convoluted way of looking at this that I can imagine. Now, he’s talking about the amendment that would allow people who cheated on their initial documents to still be able to get a crammed down reduction on their interest rate. So this amendment will allow people who cheated and who lied on their loan application to still get a cramdown, meaning a judge could reduce the cost of their mortgage payment. This is what Barney was going for and of course he brings me up as the enemy of all this. There’s a great post here by a Yale economic professor about all of this. It was tough sledding for me, the way this is written, to understand it. It involves the concept that they’re really not helping anybody by reducing their interest payments, that the only way to really help people here that are underwater is to reduce the principal, but the principal is not being touched, which means that at some point responsible people are going to default anyway because all they’re doing is renting. They’re going to have no equity even if their payment lowers. I’ll get to that in just a moment. Here again, Barney Frank advocating an amendment to allow people who cheated on their initial application for a mortgage to still get a cramdown.
RUSH: Congressman Frank, you’re a smart guy. Everybody admits it, but you’re perverting here everybody’s intention. What we’re upset about is why should the people who are paying their mortgages subsidize those who aren’t paying? Why should we pay for people to stay in their houses when they lied on their loan applications? This is the root of the tea party stuff. Barney’s definition of affordable housing is you can’t afford it, it’s yours. This is what I mean. It’s time to take the wealth of this nation and return it to its, quote, unquote, rightful owners. Now, here’s the piece here by Yale economic professor John Geanakoplos. Yeah, grab Banking Queen, Mike. That’s a good point. We’ll throw Banking Queen, we’ll play the sound bite one more time after this and then we’ll play Banking Queen. Excuse me, folks. I may be coming down with something here. Yale economic professor and also a law professor, Susan Koniak. ‘The plan announced by the White House will not stop foreclosures because it concentrates on reducing interest payments, not reducing principal for those who owe more than their homes are worth,’ the people whose houses are underwater. ‘The plan wastes taxpayer money and won’t fix the problem. Why is writing down principal, which the Obama plan rejects, so critical to stopping foreclosures?
‘Despite all the job losses and economic uncertainty, almost all owners with real equity in their homes, are finding a way to pay off their loans. It is those ‘underwater’ on their mortgages — with homes worth less than their loans — who are defaulting, but who, given equity in their homes, will find a way to pay. They are not evil or irresponsible; they are defaulting because — for anyone with an already compromised credit rating — it is the economically prudent thing to do. … President Obama’s plan does nothing to change the basic economic calculation this hard-pressed family and millions of others like it must make. The Obama strategy — which involves reducing their interest rate for five years and giving them, at most, $5,000 for principal reduction over five years — will still leave them paying much more than the $10,000 it would cost to rent.’
So if you don’t reduce the principal of these underwater homes, you’re not adjusting the value to change the status that makes them underwater. If all you’re doing is reducing the interest so as to make the payment smaller, you’re not changing the relationship of the homeowner to his house. There’s no equity. He’s underwater. So he’s renting, and he can rent far cheaper than getting a little rate reduction from a cramdown or a judge or whatever in the Obama plan. So these people are not going to be able to stay in their homes in the first place. The ones underwater, and those are the ones that are actually cared about the least, as this policy indicates. Once again, here’s Barney Frank from before the House. I’m playing this a third time because I just love it when he pronounces my name.
FRANK: There is, for instance, a noted commentator on public affairs, Mr. Limbaugh, who has a certain number of fans on that side, and if they aren’t fans, they’re afraid to say so. He has asked that the president fail. Well, the effect of this amendment would give Mr. Limbaugh his wish, because if you cripple the effort to reduce mortgage foreclosure, you cripple the effort to get out of the economic slump we are in. So I understand what some people would like to see happen, they do not want President Obama and a Democratic Congress to get any credit for helping to reduce our economic situation. They’re taking a lot of innocent people hostage.
RUSH: The estimable and honorable Barney Frank, Massachusetts, is indeed the Banking Queen.
Barney, I want you to fail, too. In fact, if Barney had failed, we wouldn’t even be here.
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I actually don’t know how Barney Frank and Chris Dodd sleep at night. I mean honestly, folks. Barney, I want you to fail at what you’re doing. In fact, if Barney Frank had failed a few years ago, this housing and financial crisis would not have happened. But instead, Barney Frank and Chris Dodd succeeded. We’re all suffering as a result of this. Your cover-up for Fannie Mae and Freddie Mac, your cover-up bore both of those things succeeded, Barney. What are you whining about? You got everything you want. You got people who can’t afford to pay for homes in homes, and now you found a way to make people who can’t afford their own home to pay for everybody else who can’t stay in their homes. You ought to be happy. What you are running around denigrating things for? You guys are having all kinds of success at causing failure for the rest of us.