I wonder if Congress will be passing any unconstitutional bills of
attainder to confiscate Rahm "Dead Fish" Emanuel's ill-gotten wealth:
Before its portfolio of bad loans helped trigger the current
housing crisis, mortgage giant Freddie Mac was the focus of a major
accounting scandal that led to a management shake-up, huge fines and
scalding condemnation of passive directors by a top federal regulator.
One of those allegedly asleep-at-the-switch board members was
Chicago's Rahm Emanuel — now chief of staff to President Barack Obama
— who made at least $320,000 for a 14-month stint at Freddie Mac that
required little effort.
As gatekeeper to Obama, Emanuel now plays a critical role in
addressing the nation's mortgage woes and fulfilling the
administration's pledge to impose responsibility on the financial
world.
Emanuel's Freddie Mac involvement has been a prominent point on
his political résumé, and his healthy payday from the firm has been no
secret either. What is less known, however, is how little he
apparently did for his money and how he benefited from the kind of
cozy ties between Washington and Wall Street that have fueled the
nation's current economic mess. …
He was named to the Freddie Mac board in February 2000 by Clinton,
whom Emanuel had served as White House political director and vocal
defender during the Whitewater and Monica Lewinsky scandals.
The board met no more than six times a year. Unlike most fellow
directors, Emanuel was not assigned to any of the board's working
committees, according to company proxy statements. Immediately upon
joining the board, Emanuel and other new directors qualified for
$380,000 in stock and options plus a $20,000 annual fee, records
indicate.
On Emanuel's watch, the board was told by executives of a plan to
use accounting tricks to mislead shareholders about outsize profits
the government-chartered firm was then reaping from risky investments.
The goal was to push earnings onto the books in future years, ensuring
that Freddie Mac would appear profitable on paper for years to come
and helping maximize annual bonuses for company brass.
The accounting scandal wasn't the only one that brewed during
Emanuel's tenure.
During his brief time on the board, the company hatched a plan to
enhance its political muscle. That scheme, also reviewed by the board,
led to a record $3.8 million fine from the Federal Election Commission
for illegally using corporate resources to host fundraisers for
politicians. Emanuel was the beneficiary of one of those parties after
he left the board and ran in 2002 for a seat in Congress from the
North Side of Chicago.
"Political muscle" describes what Emanuel provided in exchange for his
ride on the gravy train.
Financial disclosure statements that are required of U.S. House
members show Emanuel made at least $320,000 from his time at Freddie
Mac. Two years after leaving the firm, Emanuel reported an additional
sale of Freddie Mac stock worth between $100,001 and $250,000. … One
of Emanuel's fellow directors at Freddie Mac was Neil Hartigan, the
former Illinois attorney general. Hartigan said Emanuel's primary
contribution was explaining to others on the board how to play the
levers of power.
He was respected on the board for his understanding of "the
dynamics of the legislative process and the executive branch at senior
levels," Hartigan recalled. …
Another focus of Freddie during Emanuel's day — and one that
played to his skill set — was a stepped-up effort to combat
[Republican] congressional demands for more regulation.
Dead Fish's Freddie connection continued after he left to join the
Leviathan as a congresscrook.
Federal campaign records show that Emanuel received $25,000 from
donors with ties to Freddie Mac in the 2002 campaign cycle, more than
twice the amount collected that election by any other candidate for
the U.S. House or Senate.
Emanuel joined the House in January 2003 and was named to the
Financial Services Committee, where he also sat on the subcommittee
that directly oversaw Freddie Mac. A few months later, Freddie Mac
Chief Executive Officer Leland Brendsel was forced out, and the
committee and subcommittee launched hearings to sort out the mess,
spanning more than a year. Emanuel skipped every hearing,
congressional records indicate.
As for the Obamination administration's loudly promised
"transparency"…
The Obama administration rejected a Tribune request under the
Freedom of Information Act to review Freddie Mac board minutes and
correspondence during Emanuel's time as a director.
But not to worry:
Sarah Feinberg, a spokeswoman for Emanuel, said there was no
conflict between his stint at Freddie Mac and Obama's vow to restore
confidence in financial institutions and the executives who run them.
Let's not single out Dead Fish. He was hardly the only Democrat in
Congress to help create the Freddie/Fannie fiasco that is snowballing
into a depression. He's not even the only one who went on to the White
House.
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