This is a rush transcript from "The O'Reilly Factor," October 2, 2008. This copy may not be in its final form and may be updated.
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BILL O'REILLY, HOST: "Personal story" segment tonight, the financial chaos in this country is largely the fault of the citizens who cannot pay their obligations, banks who lent money to unqualified people, and the federal government which failed to provide oversight. Both political parties are to blame as I've stated.
Now "The Factor" has called on SEC Chairman Christopher Cox to resign, Senate Banking Committee Chairman Christopher Dodd to quit, and House Finance Chief Barney Frank to step down from his position. That's because for the past two years, Frank and his committee oversaw Fannie Mae and Freddie Mac — two government sponsored lending agencies which pretty much are bankrupt.
Congressman Frank was asked about Freddie and Fannie on July 14, 2008:
(BEGIN VIDEO CLIP)
REP. BARNEY FRANK, D-MASS.: I think this is a case where Fannie and Freddie are fundamentally sound, that they are not in danger of going under. They're not the best investments these days from the long-term standpoint going back. I think they are in good shape going forward.
They're in a housing market. I do think their prospects going forward are very solid. And in fact, we're going to do some things that are going to improve them.
(END VIDEO CLIP)
O'REILLY: Well, obviously, that statement turned out not to be true.
Joining us now from Washington is Congressman Frank. And we appreciate you coming in, being a standup guy, but shouldn't everybody in the country be angry with you right now?
FRANK: No. You've misrepresented this consistently. I became chairman of the committee on January 31st, 2007. Less than two months later, I did what the Republicans hadn't been able to do in 12 years — get through the committee a very tough regulatory bill. And it passed the House in May.
I've always felt two things about Fannie Mae and Freddie Mac, that they had an important role to play, but that the regulations should be improved.
Now from 1995 to 2006, when the Republicans controlled Congress and we were in the minority, we couldn't get that done. Although in 2005, Mike Oxley, of Sarbanes-Oxley fame, a pretty tough guy on regulation, did try to put a bill through to regulate Fannie Mae. I worked with him on it. As he told The Financial Times, he thought ideological rigidity in the Bush administration stopped that.
But the basic point is that the first time I had any real authority over this was January of 2007. And within two months, we had passed the bill that regulated.
O'REILLY: OK. And that's true, all of that is true.
FRANK: And then also, one other point: The Senate was dragging its feet, as often happens. And in January of 2008, I asked Secretary Paulson to put in the stimulus bill. So, the earliest chance I got to put tough regulation of Fannie Mae and Freddie Mac, we did it.
O'REILLY: All right, that's swell. But you still went out in July and said everything was great. And off that, a lot of people bought stock and lost everything they had.
FRANK: Oh, no.
O'REILLY: And — yes, oh yes. Oh, yes.
FRANK: I said it wasn't a good investment. Please stop yelling.
O'REILLY: Don't give me any of that, we just heard the words. What are you…
FRANK: That's wrong.
O'REILLY: You didn't say that? You want me to play it again for you?
FRANK: You didn't listen to it.
O'REILLY: No, I listened to every word you said. And I have the transcript right here.
FRANK: No, and I said it wasn't a good investment.
O'REILLY: Yes, you said going forward, we're going to be swell.
FRANK: No, I didn't say swell. Excuse me, Bill.
O'REILLY: Look, from August '07 to August '08.
FRANK: Excuse me, Bill.
O'REILLY: Don't — look, stop the B.S. here. Stop the crap! From August '07 to August '08…
FRANK: You know, here's the problem going on your show...
O'REILLY: …under your tutelage, this industry…
FRANK: Here is the problem going on your show.
O'REILLY: …declined 90 percent. 90 percent.
FRANK: Yes, but…
O'REILLY: Oh, none of this was your fault! Oh, no. People lost millions of dollars. It wasn't your fault. Come on, you coward! Say the truth.
FRANK: What do you mean coward?
O'REILLY: You're a coward. You blame everybody else. You're a coward.
FRANK: Bill, here's the problem with going on your show. You start ranting. And the only way to respond is almost to look as boorish as you. But here's the facts. I specifically said in the quote you just played that I didn't think it was a good investment. I wasn't telling anybody to buy stock. I said it wasn't a good investment.
Secondly, I wasn't presiding idly over this. I was trying to get the regulations adopted. We got them adopted in May.
O'REILLY: Look, bottom line is you're there two years. Bottom line is stock drops 90 percent.
O'REILLY: In any private industry, you're out.
FRANK: We couldn't get…
O'REILLY: In any private concern, you're out on your butt. But not here in the federal government.
You can come in and make every excuse in the world.
FRANK: I'm not making excuses.
O'REILLY: Blame everybody else in the world and then call me boorish.
FRANK: I'm not going to be bullied by your ranting. You can rant all you want, you're not going to shut me up! The problem was that we passed in 1994, in fact.
O'REILLY: Now we're back to 1994. This is bull. This is why Americans don't trust the government.
FRANK: No, this is why your stupidity gets in the way of rational discussion.
The fact is it was 1994 that we passed a bill to tell the Fed to stop the subprime lending. We tried to get them to do it. The first time we were in power again in 2007, we passed the bill to regulate Fannie Mae and Freddie Mac.
So during the two years I was there…
O'REILLY: Look, Congressman, you tried to put a happy face on this in July.
FRANK: I'm not putting a happy face on anything.
O'REILLY: You tried to — and now you won't take the.
O'REILLY: Look, at least Cox is man enough.
FRANK: I said….
O'REILLY: At least Cox is man enough to say he screwed up. You're not.
FRANK: Hey, Bill. This manliness stuff is very unbecoming from you. I don't see any…
O'REILLY: Cox is man enough to say he screwed up. You're not.
FRANK: You think toughness is yelling and ranting and trying to bully. It's not going to work with me. The fact is in the very quote you played, I said it's not a good investment. I tried to get the regulations adopted.
O'REILLY: You said going forward, it's going to be swell. And people under that bought stock in that, thought it was a good investment.
FRANK: I didn't say swell. I didn't say swell. No, I said in fact in that quote that you played and didn't listen to because you're busy ranting that it's not a good investment. I said that at the time. I did think we were going to improve things going forward. Yes, we had some things that needed improvement.
O'REILLY: All right, you want to — here, let me read you your quote here. OK? OK? "I do think the prospects going forward are very solid."
FRANK: But that's not the part about it not being a good investment.
O'REILLY: Now, people bought stock when you said that.
FRANK: You are distorting it. Bill, you're lying by your words.
O'REILLY: This is what you said.
FRANK: What about the part where…
O'REILLY: Not lying. And I played it and I read it.
FRANK: What about the part where I said it wasn't a good investment?
O'REILLY: You said it's not the best right now, but going forward this is going to be solid.
O'REILLY: People lost millions.
FRANK: I didn't say solid, I didn't say swell. You distort consistently. And you think ranting and raving…
O'REILLY: All right.
FRANK: …you don't want to talk about 1994, like no history is relevant. The fact is that you had a problem with an administration — conservative.
O'REILLY: I know, it's all the conservatives, it's all the Republicans and not you.
FRANK: Oh, come on.
O'REILLY: None on you. That's a joke.
FRANK: You won't have a rational discussion.
O'REILLY: That's a joke.
FRANK: The joke is to think I could have a rational discussion with you. You're ranting.
O'REILLY: No, the joke is both parties are at fault, as I stated. But one guy Cox says yes, I screwed up.
FRANK: That's a totally different issue.
O'REILLY: And one guy Frank says it's everybody else's fault.
FRANK: No, I didn't say it was everybody else's fault.
O'REILLY: It's your fault.
FRANK: You are the most — you don't listen at all, or maybe you are listening or you're too dumb to understand.
O'REILLY: I am too dumb, Congressman.
FRANK: The fact is that in — yes.
O'REILLY: No, you hit it, I'm too dumb. You're the brilliant guy.
FRANK: In 2007.
O'REILLY: You're the brilliant guy who presided over the biggest financial collapse in federal history.
FRANK: Oh, no, no, no.
O'REILLY: So you're the — I'm the dumb guy. You're the brilliant guy.
FRANK: Under the Bush administration…
FRANK: And the fact is…
O'REILLY: Congressman, thanks very much. We got to run.
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