Did McCain Call for Tougher Regulation of Fannie and Freddie? Yes, But...
There's a funny tone to reporter Jackie Calmes' "Check Point" feature Friday, "Taking On the Mortgage Giants." Although conceding that McCain was right when he says he had favored more regulation on the mortgage finance companies Fannie Mae and Freddie Mac, Calmes nevertheless insisted that McCain is exaggerating his role. Her tone is demonstrated by the story's text box: "Did McCain wage a less valiant battle than he describes?"
The paper has barely reported on McCain's 2006 sponsorship of a bill that would have regulated Fannie Mae and Freddie Mac. Now, it has devoted a full story on it - but one that tries to minimize McCain's involvement.
Senator John McCain is correct: He warned two years ago that Congress should rein in Fannie Mae and Freddie Mac, the giant mortgage finance companies, before their financial risk-taking threatened the economy, and Senator Barack Obama did not. But Mr. McCain overstates the role he has played, interviews and Senate records suggest.
Mr. McCain, the Republican presidential nominee, and his campaign have cited his co-sponsorship in 2006 of a Senate bill that would have strengthened government regulation of Fannie Mae and Freddie Mac. Mr. Obama, the Democratic nominee, was "silent," Mr. McCain tells campaign audiences, and he blames Mr. Obama's ties to Fannie Mae executives, particularly former chairmen James A. Johnson and Franklin D. Raines. Mr. Johnson has been a senior Obama adviser, but both Mr. Obama and Mr. Raines say they met once, for just minutes.
The McCain camp has hammered this attack against Mr. Obama in recent days, to counter news media reports of his own campaign advisers' ties as lobbyists and consultants for the companies. Freddie Mac paid $15,000 a month to a firm co-owned by Mr. McCain's campaign manager, Rick Davis, from 2005 through August, just before the government seized the mortgage company.
Republicans and Democrats in the Senate familiar with the legislation and lobbyists for Fannie Mae and Freddie Mac say that speech was the only action by Mr. McCain they recall on the issue. Mr. McCain "never took on the role that some other Republicans did" to try to limit the companies, said a former Freddie Mac executive who later lobbied for the company until its failure.
"I remember working against a number of amendments, and they were always introduced by Hagel and Sununu," said the former executive. "John McCain was never anywhere to be found."