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Bozell on Financial Crisis: “Saving Fannies”

Posted on October 12, 2008
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Saving Fannies
by L. Brent Bozell III
October 7, 2008

It seems like only yesterday when Enron and Worldcom collapsed. Throughout these ordeals our national media labored long and hard to paint Worldcom’s Bernie Ebbers as the face of Capitalism Corrupted while connecting the dots between the President and Enron’s “Kenny Boy” Lay, in the effort to demonstrate that corruption in action.

Now it is not a couple of business behemoths in trouble; it’s the entire economy that is teetering over a credit crisis brought on in part by corrupt government-sponsored enterprises and politicians. So where are those same journalists now?

They’re out there finding fault only with the evil private sector. The mushrooming federal government and the stewards of its never-ending expansion cannot be questioned.

Take, for example, CBS’s “60 Minutes,” with a Steve Kroft report that blamed the entire debacle on something called credit default swaps. Kroft couldn’t find even a single precious CBS minute to focus on Fannie Mae or Freddie Mac or its most powerful supporters in Congress like Rep. Barney Frank or Sen. Chris Dodd, or the biggest recipients of their corporate campaign largesse, the second largest being a certain fellow from Illinois currently running for the presidency of the United States.

Financial expert James Grant spun it exactly the way CBS – wanted, a focus on Wall Street crooks. “I will call it a criminal neglect and incompetence, the people at the top of these firms chose to look away, to take more risk, to enrich themselves and to put the shareholders and indeed the country itself, ultimately the country’s economy, at risk; and it is truly not only a shame, it’s a crime.”

You need only change a couple of words in that statement and you echo precisely what millions of Americans believe about their elected officials right now.

Steve Kroft concluded: “We requested interviews with top executives at Bear Stearns, Lehman Brothers, Merrill Lynch, Morgan Stanley, Goldman Sachs and AIG. They all declined.” So why didn’t CBS request any interviews with top executives at Fannie Mae or Freddie Mac? Because doing that would step on a few media toes.

It would have been enjoyable to see CBS grilling Fannie Mae CEO Daniel Mudd, one of the profligate “Kenny Boy” figures in the current fiasco. The New York Post reported employees called his mansion “Mudd Manor,” where he still resides, “an opulent Washington, D.C. mansion replete with expansive gardens, servants’ quarters and a home theater.” He’s the son of long-time CBS and NBC anchor Roger Mudd.

Then there’s Fannie Mae executive vice president Beth Wilkinson, who Forbes.com reports was making $3 million per year in salary and bonuses as Fannie Mae collapsed. She resigned when the government took over on September 20. On June 16, 2006, the New York Times reported her naivete on the way in: “Ms. Wilkinson, for example, knew nothing about the mortgage-backed securities at the core of Fannie Mae’s business.” But on her way out, her cluelessness no longer in doubt, nobody questioned how this woman was qualified.

No one in the media would be so rude as to note that NBC reporter David Gregory is married to Wilkinson and her ill-gotten millions. Gregory even discussed Fannie Mae on the August 10 “Meet the Press” without disclosing his family tie.

Once again, we have to shake our heads as the “mainstream” media work like a grubby protection racket for their friends and ideological allies. At the very same time media elites ignore statements like Barney Frank’s line in 2003: “The two government sponsored enterprises we are talking about here, Fannie Mae and Freddie Mac, are not in a crisis.”

Bill O’Reilly was mocked in media circles for calling Frank out for his “brilliant” mismanagement. But the more scandalous interviews are the network people who interviewed Frank and Dodd and treated them as Masters of the Congressional Universe, instead of the boys who dawdled while Hurricanes Fannie and Freddie rolled into Washington and drowned the financial system. There was no “Heckuva job, Barney” on the network sets.

No one dared to ask a classic Tim Russert-style question putting Frank’s and Dodd’s misdeeds and misstatements into a text box. When it comes to corruption, the networks pick which evil, from whom they hear evil, and definitely speak evil about.

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