The next time you hear Newt trashing Fannie and Freddie, consider what he had to say about Government Sponsored Enterprises in April 2007, at which time the housing meltdown was already underway:
Certainly there is a lot of debate today about the housing GSEs, but I think it is telling that there is strong bipartisan support for maintaining the GSE model in housing. There is not much support for the idea of removing the GSE charters from Freddie Mac and Fannie Mae. And I think it’s clear why. The housing GSEs have made an important contribution to homeownership and the housing finance system. We have a much more liquid and stable housing finance system than we would have without the GSEs. And making homeownership more accessible and affordable is a policy goal I believe conservatives should embrace. Millions of people have entered the middle class through building wealth in their homes, and there is a lot of evidence that homeownership contributes to stable families and communities. These are results I think conservatives should embrace and want to extend as widely as possible. So while we need to improve the regulation of the GSEs, I would be very cautious about fundamentally changing their role or the model itself.
But when questioned during the November 9 Republican debate about his ties to Freddie, he said:
I offered them advice on precisely what they didn’t do. I have never done any lobbying, every contract that was written during the period when I was out of the office specifically said I would do no lobbying, and I offered advice. And my advice as a historian…I said to them at the time: This is a bubble. This is insane. This is impossible.
And a statement from his campaign said:
Gingrich advised that a business model that involved lending money to people with bad credit and no money down was unsustainable and a bubble, and that it was dangerous to buy securities made up of these mortgages.
Multiple choice question:
- Gingrich liked GSEs before he disliked GSEs.
- Gingrich disliked GSEs before he liked GSEs.
- All of the above.