Newt Gingrich, who has built his now resurgent presidential candidacy in part around virulent criticism of mortgage giants Fannie Mae and Freddie Mac, found himself Wednesday defending the at least $1.6 million he reportedly earned while under contract to Freddie.
While campaigning in Iowa, Gingrich was besieged by reporters asking him about a Bloomberg News report that his consulting firm took in much more from Freddie Mac than previously reported.
The former House speaker said he didn’t know how much he had received from the federally backed mortgage company, but that he welcomed the inquiry into his private-sector work.
“Everybody will dig up everything they can dig up,” said Gingrich, according to the New York Times. “That’s fine, they should.”
He said his consulting firm, Gingrich Group, offered “strategic advice for a lot of different companies” but that he had done no lobbying.
One GOP rival, Rep. Michele Bachmann of Minnesota, wasted no time in slamming Gingrich on Wednesday for "shilling" for the company.
Last week, Gingrich was asked at a GOP debate in Michigan what work he had done to secure a $300,000 payment from Freddie Mac.
“I offered them advice on precisely what they didn’t do,” he replied. “My advice as a historian, when they walked in and said to me, ‘We are now making loans to people who have no credit history and have no record of paying back anything, but that’s what the government wants us to do.’ As I said to them at the time, this is a bubble. This is insane. This is impossible.”
A Bloomberg News story earlier this week disputed Gingrich’s account, saying that those familiar with Gingrich’s work don’t recall any warnings about the company’s business model—and that instead, his job was to rally support for Freddie Mac among Republicans in Washington.
In a follow-up story, Bloomberg reported that Gingrich’s ties to Freddie go back as far as 1999, soon after he left the House, and that he was consulted in the early days of the Bush administration on how to expland home ownership nationwide.
Gingrich’s campaign released a statement Wednesday reiterating that Gingrich had not worked as a lobbyist or as an advocate for specific legislation involving Freddie Mac, but it did not elaborate on the kind of services Gingrich performed for the company.
His consulting firm offered strategic advice to a “wide variety of clients about a wide variety of issues,” the campaign said, “including IBM, Microsoft, The U.S. Chamber of Commerce and more.”
The fees the firm received were “comparable to that of many consulting firms.”
The campaign statement also called for Fannie Mae and Freddie Mac to be broken up into smaller entities and asserted that while Gingrich is in favor of increasing home ownership in America, he “believes it has to be within a context of learning how to budget and save in a responsible way, the opposite of the lending practices that led to the financial crisis.”
Fannie and Freddie have been favorite punching bags for GOP candidates during the campaign and have been frequently cited by Gingrich and others such as Bachmann as the cause of the collapse of the U.S. housing market in 2008. At one point, Gingrich suggested that Democrats who supported the companies, such as Rep. Barney Frank of Massachusetts and former Sen. Chris Dodd of Connecticut, should be jailed.
At a campaign stop in Webster City, Iowa, on Wednesday, Bachmann blasted Gingrich’s deal with Freddie.
“Fannie and Freddie, as you know, have been the epicenter of the financial meltdown in this country,” Bachmann said, according to National Journal. “And whether former Speaker Gingrich made $300,000 or whether he made $2 million, the point is that he took money to influence senior Republicans to be favorable toward Fannie and Freddie. While he was taking that money I was fighting against Fannie and Freddie.”
Gingrich’s surprising jump in national polls has prompted renewed interest in work of the longtime D.C. power player since he left Congress. Along with his private consulting firm, he knitted together a web of operations, including a political advocacy group, the now defunct American Solutions, and the healthcare policy-focused Center for Health Transformation. He's also an author and a documentary filmmaker.