During last week's debate, Newt Gingrich was asked what he had done to earn the $300,000 Freddie Mac had given him. Gingrich claimed Freddie Mac paid him as a "historian" who warned the company about the coming housing disaster. He claimed to have warned "this is a bubble ... this is impossible."
His explanation was so transparently preposterous I actually broke out laughing. It's not just a lie. It's almost the opposite of the truth.
In reality, it was Ron Paul who spent years fighting Fannie Mae, Freddie Mac, and the other GSEs. Paul correctly pointed out that they create moral hazards that inevitably lead to malinvenstment. Paul specifically called out Fannie and Freddie's role in creating the housing bubble at least as far back as 2003, years before most people suspected anything was wrong. He warned Fannie and Freddie would fail when the bubble inevitably burst, and would dump huge losses on the taxpayers. Ron Paul's only compensation for saying these things was the satisfaction of telling Americans the truth, even though they didn't want to hear it.
Freddie and Fannie have always been popular with Democrats, but faced some opposition from Republicans (like Paul) who realized their inherent problems. To fix this, Freddie Mac hired several high-profile Republicans to lobby other Republicans on their behalf. Gingrich was actually paid at least $1.5 million to do so.
Now Gingrich is taking credit for what Ron Paul said, even though he was paid millions of dollars to convince other Republicans that guys like Ron Paul didn't know what they were talking about.
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