Presidential candidate Newt Gingrich received $600,000 from Freddie Mac in two years preceding the 2008 financial crisis. Former Freddie Mac officials say, according to Bloomberg, he was paid “to build bridges to Capitol Hill Republicans” who were “seeking to dismantle” it.
Gingrich will not confirm the exact fee, only that it was a “standard Washington fee.” And he disputes what he was hired to do.
He claims he was paid to give “advice” as a “historian.” And that advice was, in Gingrich’s words, “This is a bubble. This is insane.”
If Gingrich is telling the truth, that would mean he identified the housing bubble in 2006 or 2007, before most.
To quote The Wedding Singer, “that information really would’ve been more useful to me YESTERDAY.”
If Gingrich really saw an economically devastating housing bubble that few were warning about at the time, he surely would not only share his concerns with those who paid him a six-figure retainer. He would do the right thing for humanity, stand on the highest pedestal, scream to the heavens and sound the alarm that we had a dangerous housing bubble to tame.
And Gingrich is not known for his shyness or reticence.
Yet since he began his weekly “Newt Gingrich Letter” for the conservative Human Events magazine in April 2006, through the fall of 2008 — roughly the same time period as his work for Freddie Mac — Gingrich did not once announce that the housing bubble was coming.
In 2007, he said in his newsletter that he would not run for President because it was more important to create an “American Solutions” movement to launch the ideas that would solve American’s “daunting challenges.” (You’ll be sad to learn AmericanSolutions.com no longer exists.) But as he excitingly described all the workshops that took place at his American Solution conference, stopping a calamitous housing bubble did not warrant a mention.
So either we are supposed to believe Newt saw the financial crisis coming, but only saw fit to tell the folks that paid him hundreds of thousands of dollars.
Or, Newt didn’t really give Freddie Mac advice about avoiding housing bubbles, because he was not a professional economic historian with a speciality in housing policy. He was a lobbyist.
And if he was a lobbyist for Freddie Mac, according to Newt Gingrich himself, any congressperson he lobbied belongs in jail.
UPDATE: Based on this new Politico report, I suppose there’s a third possibility: Newt is a scam artist who took a bunch of money from Freddie Mac and didn’t do anything for it in return.