Dogged by Leading Role in Mortgage Meltdown, Andrew Cuomo Personifies Democrats’ Reversal of Fortune
Initially, Farkas and Cuomo got off to a bad personal start. Farkas was the notorious target of a high-profile slumlord lawsuit brought by Cuomo when he was at HUD. But HUD quietly settled the case out of court, permitting Farkas’s company, Insignia, to immediately divest its residential real estate for almost $1 billion.
And, disturbingly — as Wayne Barrett reported in 2006 for The Village Voice — over $800,000 in campaign contributions from Insignia and Farkas flowed into Cuomo’s coffers, beginning mere months after his departure from HUD in 2001.
Then, Farkas hired Cuomo, paying him more than $1 million from 2004 to 2006.
Barrett told the New York Times in September of 2006 that Cuomo and Farkas both tried to suppress or delay his story detailing their relationship. But Barrett followed up the report in 2008 with a cover story detailing how Cuomo, as HUD chief, ordered huge new purchases of risky loans by Fannie and Freddie, which helped trigger the mortgage meltdown.
Richard Bové, financial analyst at Rochdale Securities, agrees. In a March 3 interview with CNBC’s Maria Bartiromo, Bové charged that Cuomo’s irresponsible stewardship at HUD was a key cause of Fannie and Freddie’s bankruptcy and still-deepening bailout.
Speaking by telephone, Bové echoed Barrett’s claim that Cuomo was “the father of the subprime crisis,” an appointee out of his depth who imposed negligent and irresponsible risks on Fannie and Freddie in an apparent crusade to get the “underprivileged” into homes. Cuomo “was not as concerned about the audits or the types of loans that Fannie and Freddie were making,” Bové said, “as long as there was an expansion of mortgage services to that segment of the population.”
Bové suggests that as governor, Cuomo would show the same disregard for the interests of New York taxpayers as he did for the subprime homeowners across America who lost their homes in large part because of Cuomo’s reckless policies. “The financial system will be sharply lower, there will be fewer jobs, people will make less money, and the tax base of New York will be significantly less.”
Bové chalked up Cuomo’s disastrous HUD performance to a “total lack of knowledge of economics, finance, and …what companies like Fannie Mae and Freddie Mac could endure.” But he underscored that every board member overseeing Fannie and Freddie shares responsibility for the mortgage crisis. Their responsibility, he said, was to protect, at the most basic level, the health and stability of the corporation. “It is clear that the boards of directors of Fannie Mae and Freddie Mac did not do that, because those companies are bankrupt.”
Worse, said Bové, “the American taxpayer is on the hook for more money in these two companies than anything else the government may be doing to assist AIG or General Motors.” As estimated by the Congressional Budget Office, Fannie and Freddie cost the American taxpayer $291 billion in 2009, with $389 billion to come over the next ten years. According to the the Washington Post, Americans face a new round of millions of foreclosures, with recovery taking as many as three years.
Among the board members present at the creation of the mortgage mess was current White House Chief of Staff Rahm Emanuel, whose tenure at Freddie Mac overlapped with Cuomo’s at HUD. As the Chicago Tribune reported last year, Emanuel’s 14-month stay earned him at least $320,000. During that time, Freddie Mac spent corporate dollars on campaign fundraisers, including Emanuel’s own Chicago run for Congress in 2002. And, as the searing report issued by Office of Federal Housing Enterprise Oversight director Armando Falcon showed, Freddie’s board permitted billions in accounting overstatements.
Cuomo and Emanuel both parlayed Clinton’s patronage into lucrative personal advancement. Now, they share something else in common: an interest in getting New York Governor David Paterson out of office as quickly as possible. In the wake of his attempted coverup of an aide’s brutal abuse, pressure is building for Paterson to resign outright. Cuomo is pursuing a controversial internal probe of Paterson from the Attorney General’s office. And as Emanuel makes news for bullying Rep. Massa out of office, he keeps the heat on Paterson with the approval of President Obama.
But as scandals claim the careers of Democratic Representatives Charles Rangel and Eric Massa, Cuomo’s inside game has left him poorly positioned for an ascent to power as the savior of the New York Democrats. Unable to launch his candidacy until his probe of Paterson was complete, Cuomo has handed it all off to a freshly appointed independent counsel. As Emanuel knows well enough, for the Democrats, time is running out to reverse their soured electoral fortunes.
I’d enjoy seeing Andrew Cuomo’s culpability in our housing mortgage problems hung like an anchor around his neck. We don’t need another LIBERAL governor.
NYState and California and other states have been destroyed economically by liberal politicians. It’s time to stop the corrupt “gravy train” for unions and friends of politicians.
Toss him into a room full of appraisers and lock the door.
C’mon !
It’s time for the democrats to decide ! Do they want to be Capone or do they want to be Lenin ?
LEone ? CAPenin ?
If you want an earful, talk to Rudy Giuliani about Andrew Cuomo (what a shame we won’t be able to see them square off in the governor’s race). Seems everyone is paying a high price because presidential candidate Clinton needed Andy’s daddy in his corner.
Great reporting, but it is so stomach churning that it was hard to digest. It appears that Cuomo was able to enrich himself to a fare thee well while supping at the public trough. I hope voters will be disgusted by the swine and his compatriots who have made vast sums of wealth because of their public service.
Don’t forget Barney Frank (D-MA) and Charles Schumer (D-NY) who pushed those changes through the House and Senate, respectively. All three of these men deserve a large measure of the blame for the hole that we are in.
Huh? A Democrat embroiled in a scandal? Looks like we’ll NEVER see this story in the MSM.
Andrew Cuomo most assuredly lies to himself. The odds are minimal that he ever explicitly plotted to scam the general public. He merely fell into the corruption a little bit at a time. Cuomo perceives his overall behavior as someone sacrificing on behalf of the victims of a cold and heartless society. He is their secular savior. Cuomo is therefore entitled to a few creature comforts and financial opportunities. After all, he is not a disgusting capitalist, but a champion of the common folk. The laws were designed for the former individuals, and not those possessing a genuine love of humanity.
Sorry to see Cuomo mixed up with Farkas and the slime of becoming the handmaiden to that bunch. Cuomo was a disaster to the American citizens as the Clinton appointed chairman of HUD, and I would expect the same would happen if he became the governor of New York. As a self-proclaimed champion of the “common man” citizens of the state, and quite frankly approved in that role by the liberal media, it will be hard to challenge $18 million Farkas raised slush/campaign funds and monopartisan media sanctification of Andrew Cuomo. Unless of course the average New York State citizen voter examines his record and becomes fed up with all the corruption and politician mendacity.
Cuomo`s track record should surely be publicized.Unfortunately the Republican Party in New York state is in complete disarray.Rick Lazio is not exactly an inspiring candidate.Rudy could probably beat Cuomo but he is a flawed human being.He was a great mayor of NYC but seems to have become very indecisive.
jgreen @ #1: Elections have consequences; unfortunately some voters hear the siren song of government largess and fall for it. Othe voters have enough and vote with their feet, but then forget to vote with their heads.
There is also the ‘missing money’ that Cuomo ‘lost’ during his tenure at HUD. The first year was 16 billion, then next year was 45 billion, then they stopped reporting the losses and chalked it up to a program error. But this is what we could expect from ‘the pharmicist’ as he was known in college.
The irony is that Attorney General Andrew Cuomo would likely throw the book at the perceived scumbag capitalist who behaved like he does. We also notice similar behavior regarding a high number of Obama political appointees. Their tax problems are legendary. Laws are to be obeyed only if you are not deemed a member of the enlightened and benevolent elites. Allegedly kind-hearted people are to be given every benefit of the doubt. God help us if Cuomo and his ilk acquire more power.
Oh Come On! How is it possible not to love Andrew Cuomo? He’s so handsome with a great head of hair and the demeanor of a lad who “is to the manor born.” So what if he made a couple of kopeks as a result of his HUD tenure and he associates with various slimeballs? This is Andy Freakin Cuomo we’re talking about here. He’s been the Chosen One in New York politics since he was six. His father’s family had sixty-five people all cheerfully living in a tumble-down four room house (or tenement – I’m not sure anymore.) Dad could have played professional baseball but went to law school instead. (See Cuomo Sr.’s heartwarming and avuncular anecdote in Ken Burns “Baseball.”) Andy should be governor – Hell he should be President, in order that this family that “loves the common man” can do more for us and to us and do it more often.
Political inbreeding just continues. Incest is cleaner than politicians. How many Kennedys do we need to put up with. Cuomos also how many is enough? I guess some voters don’t care of are just staying bought with give away programs. Please do not equate Medicare with Medicaid or Social Security with SSI or its equivalent. Remember Social Security and Medicaid have been forced people to pay and participate. I just can’t wait for the third generation of Bushs the second generation of Clintons. Than God Barney Frank is unlikely to breed.
Ah yes, His Imperial Prickness, Andy Jr. I remember havinng to work overtime on a poorly-planned project for HUD when I was with a media company, and it was all Cuomo’s fault. What an insufferable asshat.
I also did a stint at Fannie Mae just after Bush won in 2000. We were gathered into a large room where one of Fannie Mae’s higherups announced defiantly to all gathered that they didn’t care that Bush and Republicans were ‘in charge,’ and that they intended to do as they damned pleased as far as lending policies. They meant it, and did, and we see the end result of what these insolent bastards have done.
They may as well hold the coronation today. Liberal New Yorkers do not care how criminal their politicians are, just so long as they are socialist enough. Spitzer, Patterson, Rangel and Massa were not thrown out by NY voters, they were forced out by the media and national outrage. NY voters would have happily let them continue to hold office.
Well…Ladies and gentleman,what are we going to do now???…I quess that means that Cuomo will be our next governor…”Meet the new boss,Same as the old boss…”…We the People are absolutely powerless….It is money, not the people who determines who gets to be in charged…We deserve the kind of leaders we have now…We have rulers not leaders…The American Experiment is FINISHED….
I feel that the so-called “law of the land” no longer has any power over those who are elected and hired to be good stewards of that law. As it stands, bureaucrats and elected officials have got the law of the land jacked around to where I can’t even bake a pie and sell it without I first hire a lawyer to help me comply with the pie-baking “regulations.” Things are truly FUBAR when the first employee anybody has to hire is a lawyer. My blood is beginning to boil because of corrupt greedy politicians. Enough is enough.
Just look at the Youtube clip of Cuomo’s 1998 interview where he BOASTS that he, as head of HUD, just finagled an $8M fine from some Texas banks because they failed to lend to the poor and underprivileged. Then, he states that he knows that there will be many foreclosures in the future, but the Federal government is more concerned w/ leveling the playing field for the poor, and that’s the risk they are willing to take. (I’m not making this up.) Meaning we, the American taxpayer, will eventually hold the bag for those who cannot afford a mortgage, but our government forced banks to lend anyway.
And thank the Lord for that! Watching this fraud morphing into the ethical hero of the day is galling in the extreme. Many of us remember hints of his shady dealings and questions about what he did to help facilitate the housing mess and his pawprints were all over HUD. Suddenly he becomes AG and viola! he’s a virgin! He (like his father) is besotted with himself, and is maneuvering himself to parachute into the governor’s mansion. Many of us are watching his machinations and are horrified to think he just might get away with it. New Yorkers don’t need another phony dirty pol who transforms himself into another “man of the people” drenched in faux virture to fool the masses and seize power. That is standard operating procedure in NY and that is why we are roiling in the mess of their making. I hope this bum is unmasked for the bum he is.
The apple didn’t fall far from the tree:like father,like scum!