Barney Frank, Then and Now, CD Edition

Greg Mankiw has a great post about Barney Frank's changing views over time on affordable housing and the role of the GSEs.

Frank's current position was summarized during a radio debate this week when Republican challenger Sean Bielat claimed that "Frank contributed to the downfall and subsequent recession by supporting lenient lending standards for prospective home buyers.  He has long been an advocate for extending homeownership, even to those who couldn’t afford it, regardless of the cost to the American people."

  

The Boston Globe reported on the debate:

"Frank, a leading liberal who has represented the state’s Fourth Congressional District for nearly 30 years and became chairman of the House Financial Services Committee in 2007, said he and other Democrats fought to curb predatory lending practices before the recession but were thwarted by Republicans. He said he had supported efforts to help low-income families rent homes, rather than buy them.

“Low-income home ownership has been a mistake, and I have been a consistent critic of it,’’ said Frank, 70. Republicans, he said, were principally responsible for failing to reform Fannie Mae and Freddie Mac, the mortgage giants the government seized in September 2008."

Greg Mankiw links to a NY Times article that presents a much different Barney Frank in 2003. Here's another example from that era that illustrates just how much Barney Frank's views on affordable housing and GSEs have changed, based on this letter to President Bush in 2004, co-signed by Barney Frank, Nancy Peolosi and 74 other Congressional Democrats: 

"We urge you to reconsider your Administration's criticisms of the housing-related government sponsored enterprises (the GSEs) and instead work with Congress to strengthen the mission and oversight of the GSEs. We write as members of the House of Representatives who continually press the GSEs to do more in affordable housing. 

We have been concerned that the Administration's legislative proposal regarding the GSEs would weaken affordable housing performance by the GSEs, by emphasizing only safety and soundness. While the GSEs' affordable housing mission is not in any way incompatible with their safety and soundness, an exclusive focus on safety and soundness is likely to come, in practice, at the expense of affordable housing.

We also ask you to support our efforts to push the GSEs to do more affordable housing. Specifically, join us in advocating for more innovative loan products and programs for people who desire to buy manufactured housing, similar products to preserve as affordable and rehabilitate aging affordable housing, and more meaningful GSE affordable housing goals from HUD."