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Frank Responds to Inaccuracy in Wallison FCIC Dissenting Statement

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Washington, DC, February 9, 2011 | comments

WASHINGTON – Barney Frank, Ranking Member of the House Financial Services Committee, today released the following response to an inaccuracy in Peter Wallison’s dissent to the Financial Crisis Inquiry Commission Report.  The section appears on page 489 of the document.

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Barney Frank, Ranking Member of the House Financial Services Committee, today released the following response to an inaccuracy in Peter Wallison’s dissent to the Financial Crisis Inquiry Commission Report.  The section appears on page 489 of the document.

In the text, Mr. Wallison quotes Congressman Frank, who in an appearance on the CNBC program The Kudlow Report, said that “it was a great mistake to push lower-income people into housing they couldn’t afford…”  Wallison implies that Frank was claiming the mistake as his own, when in fact he had opposed this policy when was actively promulgated by the Clinton and Bush administrations.

 “In 2004, during the Bush administration, HUD significantly increased targets for purchases by Fannie Mae and Freddie Mac of home mortgages fitting certain criteria for affordability.  I opposed those increases, and was quoted at the time in Bloomberg News as saying that the White House “could do some harm if you don’t revise the goals.”  Larry Lindsey, an adviser to President Ronald Reagan, President George H.W. Bush and President George W. Bush, later wrote that I was “the only politician [he knows] who has argued that we needed tighter rules that intentionally produce fewer homeowners and more renters.”

“The distinction between support of rental housing and of homeownership is critical, and Mr. Wallison’s critique is based on conflating the two.  This is an obvious error that cannot stand, especially as we begin to debate national housing policy.”

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