HUFFPOST HILL - Government Going After Mortgage Giants

05/16/2011 05:41 pm ET | Updated Jul 16, 2011
  • Eliot Nelson Eliot Nelson is a politics reporter and editor in the Huffington Post's D.C.bue=reau

We're eagerly awaiting the Holy See's policy paper on the widespread use of deer contraceptives in Maryland. As if Newt Gingrich's circa-1992 corporate training video/presidential campaign announcement clip weren't bad enough, his conflicting policy statements have exacerbated his campaign's already rocky start. And Stanley McChrystal may not have had nice things to say about Joe Biden, but he can't say ENOUGH about the fine selection of still and sparkling water in the McChrystal Group's waiting room. This is HUFFPOST HILL for Monday, May 16th, 2011:

MORTGAGE GIANTS UNDER INVESTIGATION BY GOV'T - Shahien Nasiripour scoops that HUD's inspector general audited Bank of America, JPMorgan Chase, Wells Fargo, Citigroup and Ally Financial and referred its finding to the Department of Justice for possible prosecution. A welcome shift for HUD, which is usually the demonized and not the demonizer. "The audits accuse the five major lenders of violating the False Claims Act, a Civil War-era law crafted as a weapon against firms that swindle the government. The audits were completed between February and March, the sources said. The internal watchdog office at HUD referred its findings to the Department of Justice, which must now decide whether to file charges...The resulting reports read like veritable indictments of major lenders, the sources said. State officials are now wielding the documents as negotiating props in their ongoing talks with mortgage companies aimed at forcing them to agree to pay fines to resolve allegations of routine violations in their handling of foreclosures." [HuffPost]

STANLEY MCCHRYSTAL GETTING COMFY ON K STREET - As they say in Washington, old soldiers never die -- they just fade into cushy, off-the-books sinecures on K Street. Stanley McChrystal, fired last summer after a damning Rolling Stone article, has added a lobbying component to his consulting shop, The McChrystal Group, proving again that for elite Washington, failure is not an option. McChrystal is not himself a registered lobbyist and the firm doesn't appear in the federal database. By not registering to lobby, McChrystal is not required to disclose what issues he discusses with members of Congress or who his clients are. But clients who come to the former general hoping he can pull strings on Capitol Hill will get fully serviced regardless. On Friday, two lobbyists with deep connections to the House spending panel, Jeff Shockey and John Scofield, announced in Politico Influence that they were forming a lobby shop that will be affiliated with the McChrystal Group. Roll Call reported that the pair will work out of the McChrystal Group's office in Alexandria. [HuffPost]

BIG FRACKING DEAL: T BOONE GOING ALL IN ON NATURAL GAS - Running in Roll Call tomorrow: "T. Boone Pickens has a new plan -- but fewer allies -- in his quest to curb America's dependency on foreign oil, writes Roll Call's Ambreen Ali. With wind energy projects not proving as financially viable as he anticipated, Pickens has tabled the renewable energy portion of his acclaimed Pickens' Plan for clean energy and turned his focus exclusively to increasing development of natural gas. The shift has divided what was once a powerful alliance between environmentalists and industry groups and is raising questions about Pickens' relevance to the energy debate in Washington. In an interview with Roll Call, Pickens defended his new focus as the only practical way forward."

Camera crews are camped outside the IMF on Pennsylvania Ave. When's the last time that happened? And do you think maid would've turned in the Socialist Party leader if not for the strong hotel union she knew she had behind her?

DAILY DELANEY DOWNER - Hot fad sweeping nation! Following the example set by four other states, South Carolina lawmakers want to slash benefits for the jobless. The South Carolina State Senate gave preliminary approval last week to a bill that would reduce state unemployment benefits from 26 weeks to 20 weeks while simultaneously cutting unemployment surtaxes for businesses. In recent months Michigan and Missouri cut benefits to 20 weeks, and Florida and Arkansas have slashed aid as well. Those reductions served as models for South Carolina, where the idea to decrease the number of benefits popped up in the last few weeks. "I think 20 weeks is a good balance," State Sen. Kevin Bryant (R), a proponent of the measure, told HuffPost. "We did see where other states had done that." [HuffPost]

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DONALD TRUMP SAYS HE ISN'T RUNNING - The only person in America who decides not to run for office so he can spend more time with his vast collection of commissioned oil portraits of himself ... isn't running for office. Those lucky portraits. In a statement released today, The Donald confirmed what everyone has assumed since his poll numbers started to tank. "After considerable deliberation and reflection, I have decided not to pursue the office of the Presidency...I maintain the strong conviction that if I were to run, I would be able to win the primary and ultimately, the general election...Ultimately, however, business is my greatest passion and I am not ready to leave the private sector." Humble, Donald. Reeaaalll humble. [HuffPost]

GINGRICH BACKS OFF PAUL RYAN COMMENTS AS RYAN RESPONDS - Newt Gingrich's campaign today walked backed its candidate's comments on "Meet The Press" that Paul Ryan's budget is a piece of "right-wing social engineering." "There is little daylight between Ryan and Gingrich," spokesman Rick Tyler wrote in an email to The Weekly Standard about Gingrich, an apparent right-wing social engineer. "But look how it gets reported. Newt would fully support Ryan if it were not compulsory. We need to design a better system that people will voluntarily move to. That is a major difference in design but not substance." If you're a little confused by the differing reports of Gingrich's contradictory statements, we don't blame you. Gingrich's original "MTP" statement was at odds with his comments six weeks earlier when he said that "This is a very, very serious budget and I think rivals with [what] John Kasich did as budget chairman in getting to a balanced budget in the 1990s, just for the scale and courage involved." Then, of course, there was that whole episode(s) where Gingrich was a wholehearted supporter of individual mandates. So, as you can see, there's quite a bit to keep track of. [HuffPost's Sam Stein]

Ryan spoke out about Gingrich's accusation this morning. "With allies like that, who needs the left?" Ryan quipped to Raymond Arroyo, who was guest-hosting Laura Ingraham's radio show. [The Hill]

The Club for Growth is taking aim at Gingrich's ... um ... inconsistencies. "It is undeniable that Newt Gingrich has played leading roles in some of the most important battles on behalf of economic growth and limited government in the last quarter century," the group writes in its "Presidential White Paper," "[u]nfortunately, the problems in Speaker Gingrich's record are frequent enough and serious enough to give pause." Yikes! Short of insulting Fenway Park and labeling Curt Schilling a Yankee fan, could Newt be off to a bumpier start? [HuffPost's Jon Ward]

U.S. HITS THE DEBT CEILING, OH WHAT A FEELING/WHEN WE'RE HITTING THE DEBT CEILING - The U.S. today reached its self-imposed limit on borrowing today, which the Treasury Department will sidestep with a series of temporary measures that will allow the government to continue to pay its bills into August. In a strongly-worded letter to Senator Michael Bennet, Treasury Secretary Tim Geithner laid out the reasons for sticking with tradition and raising the limit. "A default on Treasury debt could lead to concerns about the solvency of the investment funds and financial institutions that hold Treasury securities in their portfolios," he wrote, "which could cause a run on money market mutual funds and the broader financial system -- similar to what happened in the wake of the collapse of Lehman Brothers." A point of reference: Lawmakers were bewildered by the 2008 meltdown and countless members of congress and staffers will tell you that they thought the American economy would cease to exist if they didn't pass the bailout. So Geithner dropping the "Lehman Brothers" bomb is a lot like playing the race card in an argument with a white guy. It just sort of ... ends the conversation. [HuffPost's Will Alden]

Glenn Beck announced today that he will host a "Restoring Courage" event in Jerusalem this August. Can you really say "Next year in Jerusalem!" if you're 70 percent certain that the rapture will occur before then?

NY-26 SPECIAL ELECTION GETTING INTERESTING - It wouldn't be way early in a campaign season if there weren't a special election in upstate New York to fill the seat vacated by some weirdo who couldn't keep his hands to himself. Writes Stu Rothenberg, who has changed the contest's ranking from "Lean Republican" to "Tossup/Tilt Democratic": "...Republicans apparently have succeeded in bringing down self-proclaimed Tea Party candidate Jack Davis's numbers to a place where the race should be winnable for [Republican candidate Jane] Corwin. But those one-time Davis voters are not going immediately to Corwin, raising new doubts about the Republican's ability to grow her support in the final week. More importantly, [Democratic candidate Kathy] Hochul appears to have solidified her image and even increased her share of the vote." [Rothenberg Political Report]

If you're a deer, there's no reason to fret about all the attacks on Planned Parenthood. The state of Maryland will gladly give you contraceptives. *

* You probably just made a cute "Don't kill Bambi!" joke to yourself. Stop smiling.

RAHM SWORN IN AS MAYOR OF CHICAGO - For whatever reason, reporters -- both new and seasoned -- are going bonkers over the fact that a foul-mouthed, hard-charging alpha male managed to become mayor of a city with a long history of machine politics. Rahm Emanuel was sworn in today as mayor of Chicago, replacing Richard M. Daley who had held the job for 22 years. Vice President Joe Biden and his wife Jill were in attendance. "[W]e must face the truth," Emanuel said. "It is time to take on the challenges that threaten the very future of our city: the quality of our schools, the safety of our streets, the cost and effectiveness of city government, and the urgent need to create and keep the jobs of the future right here in Chicago." The AP on what lies ahead: "Emanuel inherits a city with big money problems. Not only has Emanuel's transition team predicted a $700 million budget shortfall next year, but thanks to some controversial decisions by Daley - most notably the push to privatize parking meters - he has limited avenues to find funds to improve schools and repair the city's aging infrastructure." [AP]

Ed Harris as John McCain in Game Change is terrifying ... and accurate.

BECAUSE YOU'VE READ THIS FAR - A baby goat. That's it. A baby goat.

HuffPost Hiccups. Two whoopsies from last week: We were so blindsided by the absurdity of California congressional candidate Dan Adler's "Koreans and Jews should stick together" campaign ad that we accidentally called him "Ben" -- the Newsweek editor who recently took a buyout. We also failed out of Am Govt 301 by confusing our Chafees. We mistakenly assumed a White House reference to Senator Chafee was to Lincoln Chafee, when it was actually a reference to his father, John. As a token of our contrition, here's a slow-motion video of food being thrown in the air.

KEVIN THE INTERN'S 'THIS DAY IN HISTORY' - May 16th, 1918: Congress Bans Anti-War Speech So U.S. Can Focus On A War: The government was growing increasingly concerned about anti-war dissent interfering with the U.S. effort in World War I. President Wilson's Attorneys General came up with the Sedition Act to restrict that dissent, making it a crime to say false things, insult the government or flag, or agitate the production of war materials. Penalties of the crimes were up to $10,000 in fines or up to 20 years in prison, or both. Wilson defended it as a necessary move to prevent problems at home during wartime, since the United States had a large population of socialists and others who weren't in favor of fighting Germany and Austria-Hungary. Wartime lawmaking often throws out parts of the Constitution or Bill of Rights, but at least this one was repealed in 1921, likely because no one thought another world war would happen. Thanks, KB!

JEREMY'S WEATHER REPORT (IS BACK!!!) - Tonight A cold front is moving along just to our south. Although it won't bother us too much, three low pressure systems along the Eastern Seaboard will give us pop-up showers this afternoon, along with the potential for isolated thundershowers. The good news is that all these isolated patches will just bring short bursts of rain. Tomorrow: More cloudy than Monday, with a strong possibility for thunderstorms in the late afternoon. [Thanks, JB!]


- "Beagle catches a ball." Well played, beagle. []

- The winner of the Beard and Moustache Championship remarked, "When my beard isn't styled, it goes down to my waist. It is sort of folded up." So there you have it. []

- As this video clearly demonstrates, nothing is sacred, even children's toy phones. []

- A lawsuit claims that Chuck E. Cheese's games turn children into gamblers. So, what, do the animatronic animal bands prepare them for lousy Vegas lounge acts? []

- If this cat and this owl can get along, what's to say we can't solve ... uh ... y'know ... that intractable conflict in that ... uh .... place between the ... uh ... two groups of people who don't like each other? []

- A four-year-old drives a car. But can he master D.C.'s network of circles??? []

- Stephen Hawking says there is no Heaven. Let that sink in. []

- "A love story in milk." []


@Todd_Zwillich: Hey, journos who tweet about sports stuff! You'll get to tweet about sports stuff this eve when the president hosts some sports guys!

@LEBassett: I feel the same way about Trump not running for President as I do about my last breakup: It's the loss of the dream that really hurts.

@AdamBSullivan: Let's make sure every story this summer has "And with gas at $4 per gallon..." #journalism

@marcadelman: My late night producer pal just said 2 me: it's all bin laden all the time. "He is dominating the comedy right now"



6:00 pm: Bob Corker hosts a fundraiser for himself at his home. Mitch McConnell, Jon Kyl, Kay Bailey Hutchison, John Cornyn, Lamar Alexander, John Barrasso and John Thune are all scheduled to attend. We wonder if Corker stayed up late last night perfecting his playlist for the event [The home of Bob Corker].

6:30 pm - 7:30 pm: Lamar Alexander attends a fundraiser in his honor at the offices of Express Scripts, which is a pharmaceutical services company. Wouldn't it be funny if, instead of "Express Scripts" and "pharmaceutical services company," we wrote "Girls Night Monday" and "a gathering of three middle-aged school teachers"? [Express Scripts, 300 New Jersey Ave NW, Suite 600].


8:00 am: Rise and shine, molester of democracy! Get up bright and early and try to curry favor with Sherrod Brown at his breakfast fundraiser. The contribution cap is $500 per person and $1,000 a PAC so you might want to take your "friend"-making activities elsewhere [Johnny's Half Shell, 400 North Capitol Street NW #175].

8:30 am: If you don't want to start your morning off with oysters, why not start it off with a porterhouse? Rob Portman passes the hat at his breakfast fundraiser at ... Charlie Palmer Steak??? Politics is weird [Charlie Palmer Steak, 101 Constitution Ave. NW].

8:30: Meanwhile, Richard Lugar will be having his own Charlie Palmer Steak breakfast (weird) fundraiser. This one with energy industry officials [Charlie Palmer Steak, 101 Constitution Ave. NW].

6:30 pm: Jon Kyl's Senate Majority Fund gets a major boost from appearances by Mitch McConnell and and John Cornyn. That Jon Kyl, he's a nice guy [Bistro Bis, 15 E Street NW].

6:30 pm: Unlike all those others politicians who think people want to eat at steakhouses for breakfast, Saxby Chambliss hosts his steakhouse reception and dinner fundraiser in the evening. How considerate [Ruth's Chris Steak House, 724 9th Street NW]

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