Tuesday, January 24, 2012

Newt Gingrich Still Playing Dog Ate My Homework on $1.6 Million Freddie Mac Contract

Only in Washington, DC can you get a 15 page consulting contract that goes on and on for clause after clause but when it comes to the scope of work only has the barest phrase in a sentence on your compensation:

"Consultant will provide consulting and related services as requested by Freddie Mac's Director, Pubic Policy in exchange for which Freddie Mac will pay Consultant $25,000 for each full calendar month during which Consultant provides services."
For such "consulting and related services as requested" Newt Gingrich reportedly received a total of $1.6 million dollars over 6 years through his K Street lobbying firm the Gingrich Group.

Newt and Freddie Mac have also been asked to provide the deliverables on this contract, so that it can be seen exactly what advice Newt gave to this controversial agency that was at the center of the housing bubble. That of course assumes he actually did any work at all. When the school boy says his dog ate his homework you can be sure the boy never did the homework.

Newt's story has been that he offered his "advice as a historian" and there is one clause in the agreement that may have been directed to just that. Section 5(g) provides:

Suggestions. While providing Services and Deliverables, Consultant may make comments and suggestions that are outside the scope of Services ("Suggestions"). All Suggestions are provided on a purely voluntary basis and, in the absence of a separate agreement executed by both parties, will not create any obligation on the part of Freddie Mac. Freddie Mac will have the right to use Suggestions in such manner as it elects in its sole discretion, without obligation of any kind to Consultant.
You can bet Newt did prattle on with lots of comments and suggestions and alternate history lessons outside the scope of what he was hired to do. Maybe, in fact, offering random musings was all he ever did to earn his firm this $300,000 a year.

The bailout of Fredie Mac and Fannie Mae will cost taxpayers a minimum of $154 billion. The damage to home values in the U.S. due to the financial meltdown has been much greater.

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