Daniel Acker/Bloomberg
Newt Gingrich, former U.S. Speaker of the House, speaks at a student rally after a presidential debate sponsored by Bloomberg and The Washington Post held at Dartmouth College in Hanover, New Hampshire, U.S., on Tuesday, Oct. 11, 2011.
Newt Gingrich, former U.S. Speaker of the House. Photographer: Daniel Acker/Bloomberg
The total amount is significantly larger than the $300,000 payment from Freddie Mac that Gingrich was asked about during a Republican presidential debate on Nov. 9 sponsored by CNBC, and more than was disclosed in the middle of congressional investigations into the housing industry collapse.
Gingrich’s business relationship with Freddie Mac spanned a period of eight years. When asked at the debate what he did to earn a $300,000 payment in 2006, the former speaker said he“offered them advice on precisely what they didn’t do,” and warned the company that its lending practices were “insane.”Former Freddie Mac executives who worked with Gingrich dispute that account.
Gingrich’s first contract with the mortgage lender was in 1999, five months after he resigned from Congress and as House speaker, according to a Freddie Mac press release.
His primary contact inside the organization was Mitchell Delk, Freddie Mac’s chief lobbyist, and he was paid a self-renewing, monthly retainer of $25,000 to $30,000 between May 1999 until 2002, according to three people familiar with aspects of the business agreement.
During that period, Gingrich consulted with Freddie Mac executives on a program to expand home ownership, an idea Delk said he pitched to President George W. Bush’s White House.
Political Benefits
“I spent about three hours with him talking about the substance of the issues and the politics of the issues, and he really got it,” said Delk, adding that the two discussed “what the benefits are to communities, what the benefits could be for Republicans and particularly their relationship with Hispanics.”One idea that the former Georgia congressman proposed that Freddie Mac didn’t pursue was initiating a program with the Boy Scouts of America to teach youngsters the importance of saving money and maintaining good credit so they would qualify to buy a home later in life.
In 2001, according to one person familiar with the work Gingrich performed, company officials asked him for feedback on their plan to publicly embrace “six voluntary commitments.”
The six items included a pledge to periodically issue subordinated debt, manage liquidity, undergo capital stress tests and expand various types of risk disclosures. Gingrich applauded the ideas, saying they would enable Freddie Mac to demonstrate benefits to the taxpayer, the person said. Read More
Source Bloomberg News
