The PJ Tatler

Great: Did Gingrich Flip-Flop on Fannie Mae for Cash?

When asked during the debate why he was paid $300,000 by Fannie Mae in 2006, here’s what Newt Gingrich had to say.

HARWOOD: Since — since you mentioned Fannie and Freddie, Speaker Gingrich, 30 seconds to you, your firm was paid $300,000 by Freddie Mac in 2006. What did you do for that money?

GINGRICH: Were you asking me?


GINGRICH: I offer them advice on precisely what they didn’t do.


Look — look, this is not — this is not…

HARWOOD: Were you not trying to help Freddie Mac fend off the effort by the Bush administration…


GINGRICH: No. No, I do — I have never…

HARWOOD: … and the — to curb Freddie Mac.

GINGRICH: I have — I assume I get a second question. I have never done any lobbying. Every contract was written during the period when I was out of the office, specifically said I would do no lobbying, and I offered advice.

There, Gingrich is answering a question that wasn’t asked. He wasn’t asked specifically about lobbying. He was just asked why Fannie had paid him $300,000.

And my advice as a historian, when they walked in and said to me, “We are now making loans to people who have no credit history and have no record of paying back anything, but that’s what the government wants us to do,” as I said to them at the time, this is a bubble. This is insane. This is impossible.

GINGRICH: It turned out, unfortunately, I was right and the people who were doing exactly what Congresswoman Bachmann talked about were wrong. And I think it’s a good case for breaking up Fannie Mae and Freddie Mac and getting much smaller institutions back into the private sector to be competitive and to be responsible for their behavior.

But flashback to 2008.

The Bush administration and Federal Reserve Chairman Alan Greenspan were sounding the alarm about the potential threat to the nation’s financial health if the fortunes of the two mammoth companies turned sour. They did eventually, when they took on $1 trillion worth of sub-prime mortgages and when their traditional guarantee business deteriorated. Commercial banks regarded Freddie Mac and Fannie Mae as competitors and were anxious to pick up business that would result from scaling back the two companies.

Pushing back, Freddie Mac enlisted prominent conservatives, including Gingrich and former Justice Department official Viet Dinh, paying each $300,000 in 2006, according to internal records.

Gingrich talked and wrote about what he saw as the benefits of the Freddie Mac business model.

So he didn’t lobby as politicians define lobbying. “Fend off” (Harwood’s phrase in the debate) may or may not be actual lobbying, but probably isn’t the kind of lobbying that requires registering yourself or your company as a lobbyist. But the appearance here is that Gingrich can be bought.