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Paul Kiesel
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Congressman Barney Frank on Newshour

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Yesterday, on PBS’ Newshour, Congressman Barney Frank debated Congressman Tom Price (R-Roswell) on the issues surround the latest housing bill that passed the House vote earlier in the day.

During the debate it appears that Congressman Price becomes contradictory in his assertions (assertions that most Republicans who voted against the Frank-bill make) on how the government has been handling the mortgage crisis and what its role should continue to be. When Congressman Frank points out that Price’s claims are contradictory, Price makes no concessions.

Below are parts of the transcript from the debate:

IN REGARDS TO HOME PRICES STABILIZING

REP. TOM PRICE: Well, how — how do you get to the bottom of this housing problem and challenge that we have? You get to the bottom when the market determines that housing prices have fallen to an appropriate amount. And, hopefully, we still believe that markets ought to be how we determine what housing prices ought to be, and not that the government ought to be determining that.

When we get to that bottom, then housing prices will — the demand will increase and housing prices will begin to come up. You can’t artificially change that by congressional action, by governmental action.

When you try to do that, all you do is manipulate the market and, I believe, prolong the challenges and the pain that — that we’re feeling. And, just as a point on that $300 billion, it’s extremely important. The chairman is very accurate in what he says all the time. And he’s very accurate in what he puts in bills. And the $300 billion is in there for a reason.

It’s because that’s the ultimate exposure if in fact the worst thing would happen — were to happen. And that’s important to appreciate.

REP. BARNEY FRANK: That’s the silliest thing people will hear today, even if they watch the Cartoon Network. That would be if every mortgage totally failed, and you recovered nothing from it.

By the way, I probably shouldn’t have been here, because Mr. Price could have debated himself, because when he says have the government stay out of the market, that contradicts his bragging about FHA Secure and the HOPE NOW, which were also government interventions in the market.

MARGARET WARNER: Congressman…

REP. BARNEY FRANK: So, there’s just a total contradiction here about what you do or don’t do.

DIFFERENCE BETWEEN THE BEAR STEARNS BAILOUT AND BARNEY FRANK’S HOUSING BILL

REP. TOM PRICE: Well, it’s apples and oranges. Bear Stearns wasn’t on the floor today. In fact, the Bear Sterns assistance never came for congressional action, because it happened through the Federal Reserve. They made that decision, not Congress. We didn’t get a chance to vote on that.

And I would also make the point that this, in fact, is another bailout, if you will, for lenders. It’s a bailout for Wall Street. It’s not a bailout for borrowers, because lenders are the ones that determine whether or not this step occurs, whether they ask the FHA to move into this program. This is a bailout for lenders. It’s a potential $300 billion liability transferred from borrowers and lenders to the taxpayer. And that’s not what the American people think are fair, especially the 110 million who have paid their mortgage, have paid off their home, or are renting [. . .]

REP. BARNEY FRANK: You didn’t get an answer on how the Bush administration, which strongly supported Bear Sterns through the Treasury Department and its appointees, how it’s OK to do $29 billion for Bear Sterns, but not $2.4 billion for homeowners.

REP. TOM PRICE: Well, with all due respect, Mr. Chairman, it wasn’t a congressional action.

REP. BARNEY FRANK: No, but it was the Bush administration. I understand that. I wouldn’t say it was a congressional action, if you were listening. I said the Bush administration. The Bush administration, I was asked, has threatened to veto the bill.

They say you can’t do $2.4 billion for homeowners, but you can do $29 billion for the people who did business with Bear Sterns.

REP. TOM PRICE: Margaret, the important thing to take home is that there have been two million individuals, nearly two million households that have been helped by programs that are already in place that don’t increase taxpayer liability. That is the important take-home message.

REP. BARNEY FRANK: But that interfere with the market, Tom. I thought you weren’t for those.

Oh, the FHA Secure does involve taxpayers. You’re simply wrong about that. FHA Secure is the FHA guarantee, which is where the taxpayers become liable.

MARGARET WARNER: OK, Gentlemen, we have to leave it there.