Ron Paul’s bill to audit the Fed has been approved by the House Services Committee. The Bill is intended to bring congressional oversight and transparency to one the most secretive institutions. The bill reached 300 congressional co-sponsors and passed  43/26 as an amendment to another financial reform bill. The Bill is awaiting its final approval by the Committee.

Fed Chairman Ben Bernanke opposes the Bill, claiming it will interfere with Monetary Policy. There has been a three decade ban on audits of the Fed. The Bill still has to face the Senate and awaits Obama’s approval, who has proven to favor the status quo in regards to Monetary Policy.

Rep. Barney Frank who chairs the House Financial Services Committee opposes the Bill saying, “It’s going to be seen as weakening the independence of monetary policy with consequent negative implications.” Frank supports a competing measure sponsored by Democrat Mel Watt that Paul says will make it even more difficult to audit the Fed.

That is false propaganda because the Fed is beholden to private bankers rather than Congressman who can be held accountable by the electorate. Paul says, that “this is the bill that would allow the people to win over the special interests, and that “There is no doubt that the individuals opposing this amendment represent the secrecy of the Federal Reserve. An audit shouldn’t hurt them in any way.” Paul blames the financial crisis on lack of oversight of financial institutions.

Ron Paul who has long been an opponent the Federal Reserve and advocate for a sound constitutional currency was joined by leading democratic Fed critic as a Co-sponsor to the Bill. Grayson said, “there’s a crying need to expand it because the Federal Reserve has completely changed the way it’s done business since a year and a half ago.”

What most people do not know is that the Fed is a private bank. The Fed continues to print money out of thin air to bail out Wall Street, subsidize our nation building overseas, as well as to pay our debt to private bankers. With the recent financial crisis and the bailouts of Wall Street, Congressman Ron Paul’s warnings about our unsustainable financial policies have been vindicated. Ron Paul believes that the Federal Reserve should be abolished all together and replaced with a Constitutional sound currency such as a gold standard. The Constitution grants Congress the right to issue currency, therefore the Federal Reserve in Unconstitutional.

While Paul is a lone voice for abolishing the Fed all together, the movement to audit the Fed has gained popular support in congress. His campaign was responsible for making the Federal Reserve and Monetary Policy a major issue. This Bill is the first major milestone since the Fed was created Secretly and Unconstitutionally in 1913.

http://www.examiner.com/x-9462-LA-Nonpartisan-Examiner~y2009m11d19-Ron-Pauls-audit-the-Fed-Bill-approved-by-House-Panel

Oscar Wilde once said “There are many things that we would throw away if we were not afraid that others might pick them up”. The same may be true of interchange fees and margins.

This month the Competitive Enterprise Institute (CEI) published a report called “Payment Card Networks under Assault” which makes the case that capping interchange fees will hurt consumers, charities, community banks and credit unions. One of their primary claims is that retailers would not pass on savings from lower interchange fees to consumers. The CEI points to the GAO report which concluded that “consumers may not experience lower prices and retailers could pocket the entire windfall resulting from any reduction in interchange fees”.  Meanwhile, the Consumers for Competitive Choice (C4CC) called for interchange fee reform stating that reform would spur job growth, and as expressed by one President of a 90 store chain who is paying nearly 3.5 million dollars in interchange fees saying: “lower fees would mean lower costs for consumers”.

 Would a retailer pass on savings to consumers if interchange fees where lowered? Here’s another question: Will retailers use discounts to compete with credit card companies for the consumer’s method of payment? And if they do, what methods are available; price roll back for ACH or cash credit pricing? As the ball goes back and forth on this issue, both sides need to be cognizant that Congress is looking for solutions that benefit the consumer. Unless the retailers can demonstrate that they are willing to provide lower retail prices to consumers for less expensive forms of payment, why should Congress believe that consumers will benefit from a cap on interchange fees?  (http://www.linkedin.com/in/peterguidi)

FT – Secured creditors could face government-imposed losses as a result of a financial regulatory reform bill designed to end the phenomenon of companies that are “too big to fail”, which overcame a hurdle in the US Congress on Wednesday.

The House financial services committee approved a bill to regulate systemic risk, which includes a provision whereby secured creditors of a failing systemically important company could see 20 per cent of the debt treated as unsecured and potentially wiped out.

But the Treasury, Federal Deposit Insurance Corporation and key lawmakers are discussing possible changes to head off a charge from the financial industry that credit availability will suffer and the system could be destabilised.

Banks have warned that the provision – called the Miller-Moore amendment, which aims to limit the backstop taxpayers provide to creditors – could have a chilling effect on the “repo” market and thus on broader credit availability.

Supporters argue it will only be used in circumstances where an institution’s equity and unsecured creditors are wiped out. They say it will encourage market discipline and any marginal increase in the cost of short-term funding could be positive. Some securities could also be exempt from the provision.

The repurchase, or repo, market lies at the heart of the global markets’ financial plumbing. In a repo, an investor can borrow cash for a short period from another party, using securities as collateral. Investors with large portfolios of securities can thus lend these out and earn a return.

”The proposed legislation will certainly reduce leverage and liquidity in the repo market,” said Ira Jersey, head of US fixed income strategy at RBC Capital Markets. ”People who lend cash in repo, will demand more collateral.”

During the financial crisis, lenders of cash in repo began withdrawing from the market – which hit Bear Stearns and Lehman Brothers, which relied on repo to meet half their obligations.

Analysts and market participants warn that the proposal could intensify any future run on a bank that uses the repo market to fund its balance sheet, as lenders are more likely to withdraw funds if part of their security is removed.

More

Market Power gives a firm the ability to employ anti-competitive tactics like predatory pricing without losing customers to competitors. During testimony on H.R. 2382, the Representative of The Merchants Payment Coalition stated that “there is no competitive market for interchange fees – just naked price fixing”. On the other side, the Representative from The Electronic Payments Coalition called interchange an “important element(s) of the successful, competitive banking experience” adding that “interchange reflects a merchant’s fair share of the costs” (sic.) of the system.

Last weeks GAO report found that Merchants’ are in fact paying more to accept credit cards, but also added that “network competition in the credit card market may be contributing to rising interchange rates”.

Two-sided markets exhibit “Network Effects” when two groups of users are attracted to each other, in this case retailers who accept payment and consumers who make payment.  “Cross- Side Network Effects” occur when enough users are attracted to one side that the other side will pay dearly to reach them.  In this case, retailers are the “money side” and they pay to accept cards as a form of payment, while consumers are the “subsidy side” who receive incentives to use the cards as a form of payment. Linking these two groups together is the primary value of the payment platform creating powerful Cross-Side Effects.

Retailers’ accept cards as payment because so many consumers use cards for payment. Competition between card issuing banks to capture consumers, and networks to capture banks is intense as evidenced by the multiple offers for high earning rewards credit and debit products and their users. Retailers ultimately see the cost of this competition reflected in rising interchange fees, particularly the higher rate fees for reward based programs. The question is; does this competition between networks and financial institutions for the consumers’ payment business justify the increasing rates paid by retailers to accept these forms of payment or does it constitute a monopolistic example of a market failure?

http://www.linkedin.com/in/peterguidi

Looks like it. In this topsy-turvy political world Sarbox was ushered in by a GOP-controlled Congress and is being systematically gutted by a Democratic Congress. Of course one the unintended consequences of Sarbox was an untenable burden on small business. Wall Street was going to motor along, accounting firms were going to bank and Main Street was going to take it on the chin once again.

From the link:

The House Financial Services Committee has approved an amendment to the Investor Protection Act of 2009 to allow most companies to never comply with the law, and mandating a study to see whether it would be a good idea to exempt additional companies as well.

Some veterans of past reform efforts were left sputtering with rage. “That the Democratic Party is the vehicle for overturning the most pro-investor legislation in the past 25 years is deeply disturbing,” said Arthur Levitt, a Democrat who was chairman of the Securities and Exchange Commission under former President Clinton. “Anyone who votes for this will bear the investors’ mark of Cain.”

Those who favored the amendment saw it differently. They were simply out to help small businesses, which would be burdened by having to report on whether they maintained acceptable financial controls, and to have auditors check on whether those controls worked.

There are other threats to Sarbanes-Oxley as well.

Ron Paul’s Fed Audit Bill Passes House Financial Services

Politico
November 20, 2009

The House Financial Services Committee will vote on approving the underlying bill after Thanksgiving recess.

by Annette L. Nazareth, for The Harvard Law School Forum at Harvard Law School, November 19, 2009.

Annette Nazareth is a partner in the Financial Institutions Group at Davis Polk & Wardwell LLP. This post is based on a Davis Polk & Wardwell LLP client memorandum by Ms. Nazareth together with Donald Bernstein, Luigi De Ghenghi, John Douglas, Randall Guynn, Arthur Long, Margaret Tahyar and Reena Agrawal Sahni.  The memorandum, including an appendix table summarizing the key differences between the resolution of assets and claims under the Bankruptcy Code and under the House’s draft bill, is available here.

The legislative season for financial regulatory reform is now in full swing. In the last two weeks, the leadership of the House Financial Services Committee and Treasury have jointly proposed a revised version of the Obama Administration proposals of last summer. Thereafter, the House Financial Services Committee began to amend the proposal, titled the Financial Stability Improvement Act of 2009, and the Chairman of the Committee, Representative Barney Frank (D-MA), has made clear that further changes will be made next week. This week, Senator Christopher Dodd (D-CT), Chairman of the Senate Banking Committee, released his own competing discussion draft of regulatory reform, entitled the Restoring American Financial Stability Act of 2009…(continue reading)

Last month the House Financial Services Committee took testimony on H.R. 2382 from both the Financial Industry and representatives of the Merchants Payments Coalition which represents NACS. Both parties represented their point of view. On the retailer side, the argument remains that the retailers are unable to negotiate with the card associations for lower prices. Retailers expressed that banks and card associations are monopolistic so, congress should act to legislate and control fees or at least give retailers the ability to negotiate for lower fees and that the payment providers should be subject to Anti-Trust legal action. The key evidence being the “outrageous” swipe fees retailers pay to accept a credit card. On the other hand the Banks cried foul claiming that retailers are simply trying to use their power to gain the valuable credit card payment services without having to pay a fair price. The credit card representatives presented an argument demonstrating that interchange fees are fair, and in fact are undervalued.

This raises the question: Why would Merchants accept payment cards if the fees associated with the card are greater than the benefits? Interchange is a fee for a service that brings value to consumers and retailers and while retailers may have choices about method of payment, or even alternative payments, it turns out that promoting a method of payment is expensive and time consuming. It’s so much easier to put a sticker on the door that says” MasterCard and Visa” accepted here.  Eleanor Roosevelt once said, “It is not fair to ask of others what you are unwilling to do yourself” and therein may lay the answer. (http://www.linkedin.com/in/peterguidi)

by Eduardo Gallardo, for The Harvard Law School Forum at Harvard Law School, November 10, 2009.

(Editor’s Note: This post is based on a Gibson Dunn & Crutcher LLP client memorandum by Michael Bopp, Jennifer Bellah Maguire, Edward Nelson, Edward Sopher and Amanda Neely.)

This update focuses on the House Financial Services Committee’s consideration and approval on October 27, 2009 of H.R. 3818, the Private Fund Investment Advisers Registration Act of 2009. The full text of the bill as amended by the Committee is not yet available.

Overview of Process

While few things are predictable and nothing is certain about the legislative process, the Private Fund Investment Advisers Registration Act has a decent chance of becoming law in a form not unlike that which was reported out of the House Financial Services Committee last week. The once-controversial bill was the subject of a remarkably bipartisan mark-up, particularly in contrast to the Consumer Financial Protection Agency Act (H.R. 3126) mark-up, which followed shortly thereafter. Most amendments to the bill were adopted by near-unanimous voice votes, and the Committee approved the bill, as amended, by a vote of 67 to 1 (Representative Ron Paul (R-TX) was the lone dissent)…(continue reading)

This should be welcome news.

From the link:

Small businesses would be granted a permanent reprieve from complying with part of the Sarbanes-Oxley corporate reform laws, under a draft U.S. House of Representatives bill discussed on Tuesday.

Small companies have not had to comply fully with the rules since the Sarbanes-Oxley law was approved in 2002 in response to the Enron and WorldCom corporate scandals.

Companies with a market capitalization below $75 million have argued that they faced disproportionately higher costs compared with larger companies and have convinced regulators to delay compliance at least five times.

The Securities and Exchange Commission is now requiring small companies to report on the effectiveness of their internal controls as of June 15, 2010.

But Republicans, hoping to thwart this SEC requirement, introduced an amendment on Tuesday to a House Financial Services Committee draft bill to do just that.

The Democrats of the socialist government are clammoring for tougher credit card rules.

Barney Frank, the chair of the House Financial Services Committee says he will fix everything. 

Does it strike anyone as sadly ironic if not angering that the government who has bankrupted Americans to the tune of $10T and decided that the solution was to spend more than they have ever spent before by miles and run the debt to $12T, is telling Americans how they should manage their finances?

Fix everything for who?  For the people who are good and responsible Americans and pay their debts and bills on time?  Of course not, these people do not need “protection”.

Who is being protected?  Barney Frank and the Democrats.  Of course.  They are pursuing all of these socialists programs because they steal from a few and bribe the many with it, minus a percentage for themselves of course.

And how is Frank going to steal from responsible Americans with this regulation of banks?  If banks are told how much money they can charge for one kind of service which in this case is extending credit to people who do not honor their obligations by paying their bills, the banks will be forced to charge more for other things.  The banks will then do things like forcing everyone to pay fees for their credit cards and introducing other fees for services. 

And why not believe him when his list of accomplishments includes presiding over the total collapse of Fannie and Freddie and dragging down the US and other national economies into the worst recession in 80 years.

The socialists solution to the problems they create is always the same: more socialism.

The net effect of this is similar to all other socialist programs: responsible Americans are being forced to pay for people who don’t honor their obligations. 

Perhaps that another reason why Democrats like Frank and the socialists feel such a kinship for each other: neither one honors their obligations and both demand that you pick up the check.

Once upon a time there was a liberal crusader named Barney Frank. Barney was famous for his toughness, his smarts, and his canny ability to realize when he was being conned. Then the Democrat party won the Congress back and Barney found himself Chair of the House Financial Service Committee. Suddenly (*dummmm da dum-dum*) he was replaced by an evil twin who became the banksters’ best friend, shoveling them $$$ by the barrel and protecting their profits at our expense. What happened? Who pulled the switcheroo?

The new Barney Frank, whoever he really is, will be attacked today by the AFL-CIO’s new president, Richard Trumka, for proposing a new set of banking regulations that, rather than restricting the power of banks to make their own rules, actually gives them more power than they had before they crashed the economy. What a good idea. Not. (Via Digby)

After weakening current law on derivatives, the committee is proposing once again to weaken law in the banker’s favor. The draft legislation concerning banks “too big to fail” would actually lead to more bailouts over the long run. In an advance copy of AFL-CIO President Richard Trumka’s prepared testimony that I obtained, Trumka will tesify that:

The discussion draft appears to take the most problematic and unpopular aspects of the TARP and makes them the model for permanent legislation.

Essentially the legislation would weaken regulation and lead to the conditions in which the American people would be forced to bail out the banks again. As Trumka testifies:

The discussion draft would appear to give power to the Federal Reserve to preempt a wide range of rules regulating the capital markets – power which could be used to gut investor and consumer protections.

Trumka goes onto explain in vivid details how the Federal Reserve with its lack of accountability has traditionally acted in the interests of the banks:

The Federal Reserve currently is the regulator for bank holding companies. In that capacity, it was responsible throughout the period of the bubble for regulating the parent companies of the nation’s largest banks. While regulatory authority rests in the Board of Governors of the Federal Reserve in Washington, routine responsibility for regulatory oversight has been delegated by the Board of Governors to the regional Federal Reserve Banks. The Federal Reserve System’s regulatory expertise resides in these regional banks. The problem is that these regional Federal Reserve Banks are actually controlled by their member banks – the very banks whose holding companies the Fed regulates. The member banks control the selection of the majority of the regional bank boards, and the boards pick the regional bank president, who are effectively the CEO’s of the regulatory staff… Giving the Federal Reserve with its current governance control over which financial institutions are bailed out in a crisis is effectively giving the banks the ability to raid the Treasury for their own benefit.

Trumka explains how the proposed legislation would give the big banks more of an incentive to take risky bets in order to drive out their competition:

We are also deeply troubled by provision in the discussion that would allow the Federal Reserve to use taxpayer funds to rescue failing banks, and then bill other non-failing banks for the costs.

Isn’t that absolutely absurd? If a bank deemed “too big to fail” by the Fed takes out risky bets and its fails miserably, the other banks who were engaged in safe banking would have to bail them out.

(emphasis added)

And that’s not the worst. Barney’s Committee’s legislation would allow the Congress to do all the bailing out in secret.

[T]he proposed legislation would allow the government to bail out banks into the trillions of dollars without having to seek Congressional approval. It would allow the Federal Reserve to bail these banks out secretly without the public knowing about it.

Is this a Goldman Sachs’ wet-dream or what? And Barney Frank is chairing the Comittee that came up with this abomination? I don’t think so. The Real Barney Franks would NEVER let this anywhere near the floor. So what happened to him? Where is he? And who switched him for this ass-kissing Uriah Heep, slave of the investment banking class? Hmm?

Come on. We want answers.

by Hal Scott, for The Harvard Law School Forum at Harvard Law School, October 27, 2009.

(Editor’s Note: This post is based on a letter sent by Hal S. Scott, R. Glenn Hubbard and John L. Thornton of the Committee on Capital Markets Regulation, an independent and nonpartisan research organization dedicated to improving the regulation and enhancing the competitiveness of the U.S. financial system, to the Chairmen and Members of the House Financial Services Committee and the Senate Banking, Housing and Urban Development Committee.)

The Committee on Capital Markets Regulation (“Committee”) has, since its establishment in 2005, provided empirical, independent research dedicated to improving the regulation of U.S. capital markets. In May 2009, the Committee published its report entitled, The Global Financial Crisis: A Plan for Regulatory Reform, setting out 57 recommendations for enhancing the soundness and effectiveness of the U.S. financial regulatory framework. As part of its recommendations, the report sets out the Committee’s proposals for reforming the U.S. regulatory architecture to make it more robust and better designed to address the needs of investors and consumers of financial services. In this context, we felt that it would be useful to set out our position on the Administration’s proposal— presently embodied in H.R. 3126, the Consumer Financial Protection Agency Act of 2009 (Act)—that would establish the Consumer Financial Protection Agency (CFPA) as a dedicated agency for regulating and overseeing consumer protection issues in the provision of financial services. Where appropriate, we also make reference to the revised discussion draft of H.R. 3126 (revised discussion draft), proposing changes in the CFPA bill, circulated by Chairman Frank to the House Committee on Financial Services on September 22, 2009…(continue reading)

While it’s true that Vt. Senator Bernie Sanders is the most liberal senator in the Senate today, one can hardly dispute the facts he presents in this video.

Given the news coming out on the House Financial Services Committee’s Reform Bill – a bill that is filled with loopholes and lacks real reform – it might be well to think about what Sen. Sanders says…and contact your Congressional representatives to remind them for whom they work and who pays their salary. Unless, of course, another financial melt-down doesn’t bother you because that’s exactly what will happen again if real reform and regulation is not passed.

Just the title “Pay Czar” leaves me with a negative connotation.  As does the concept of the government cracking down on executive compensation within a public company governed by an elected board of directors for the benefit of public shareholders.

Yesterday’s announcement that Bank of America’s Ken Lewis had agreed (was forced) to forgo his remaining 2009 compensation of $1.5 million and give back the $1 million he has earned over 2009 is troubling.  If Mr. Lewis did anything wrong to deserve this – as in criminally wrong – then he should be charged with a crime and prosecuted.  If he didn’t, then he has a right to his contractual compensation.

Of course, we all know what this is all about.  Perception.  CEOs are easy targets and actions against CEOs seem to satisfy the public for everything that is wrong in the world.  But, how arbitrary can it get?  Mr. Lewis’ retirement package is worth a reported $69.3 million, certainly a lot of money by any standard.  However,  explain to me how causing Mr. Lewis to give up $2.5 million is going to change the fact that he will still receive $69.3 million?  It won’t.  His penalty for bad performance is losing his job and that’s where it should stop.

Which brings me to the fairness issue.  If the government is going to penalize a CEO for past performance by taking away his pay, shouldn’t the taxpayers demand the same for Congress?  Perhaps we should have a Pay Czar elected by the people to monitor and judge the job performance of Congressional leaders.  In particular, I’m thinking about the policies of the House Financial Services Committee and it’s chairman Barney Frank that precipitated the housing and banking crisis in the first place.  Perhaps a dose of their own medicine will return some accountability to Washington.

Rep. Barney Frank tightens rules for financial reform – the only solution, in his opinion, to rebuild the fractured economy and avoid its occurrence. The story on www.southcoasttoday.com.

From POLITICAL HOTSHEET at CBS News Blogs (September 30, 2009):

Democratic Representative Alan Grayson of Florida, who has come under fire from Republicans for suggesting on the House floor Tuesday night that “Republicans want you to die quickly if you get sick,” said in an interview with CBSNews.com Wednesday that the response to his comments has been “overwhelmingly positive.”

“People are calling us from all over the country to congratulate us for telling the truth,” he said. “People are happy to see a Democrat with guts.”

Original movie poster

Asked if he expected Republicans to put forward a resolution of disapproval criticizing him for his comments, Grayson said he expected that it would happen, though he is “quite sure it won’t pass.” Rep. Tom Price of Georgia has drafted a resolution rapping Grayson for “a breach of decorum and degraded the integrity and proceedings of the House,” though he has not yet introduced it.

“A resolution like that doesn’t save one human being’s life,” Grayson said, arguing that it instead will give people reason to focus “yet again on the fact that the other side is incapable of even coming up with an alternative” to Democrats’ health care reform efforts.

…snip…

In response to Republican calls for him to apologize for his initial comments, Grayson was defiant on the House floor Wednesday afternoon, offering an apology not to Republicans but “to the dead and their families that we haven’t voted sooner to end this holocaust in America,” a reference to Congress’ inability to pass a health care reform bill.

Grayson said in the interview Wednesday that “no one, other that these Republicans who are desperate to change the subject, has asked me to apologize.”

The freshman Orlando-area representative, who hails from a swing district and is reportedly being targeted by Republicans in the 2010 election, said he is not worried that his opponents will use the controversy against him.

“No one’s drumming me out of office. I beat a forth-term Republican incumbent [in 2008],” he said.

“I’m not going anywhere,” Grayson added. “I don’t even have an opponent yet.”

From WAR ROOM at Salon (September 30, 2009):

House Republicans wanted Rep. Alan Grayson, D-Fla., to apologize for saying the GOP healthcare reform plan is “don’t get sick,” and if you do get sick, “die quickly.” And Grayson did head back to the House floor on Wednesday to discuss his remarks — but the apology the congressman made is probably not what his Republican colleagues had in mind.

“I would like to apologize — I would like to apologize to the dead,” Grayson said, citing a recent study that showed almost 45,000 Americans die each year in part because of a lack of health insurance.

(Video at Salon link)

From the St. Petersburg Times:

“The biggest argument against Alan Grayson is Alan Grayson,” said Rep. Lynn Westmoreland, a Georgia Republican who has been helping vet potential challengers.

Already Grayson is one of the most targeted incumbents in the country, having defeated four-term Republican Ric Keller, and his re-election bid embodies the challenge Democrats face in holding control of Congress as the president’s approval rating falls.

But a leading opponent has not yet emerged, and Grayson, the 12th-wealthiest member of Congress, has resources to defend himself. He spent $2 million of his own money on the 2008 campaign. (The “die quickly” speech has triggered $150,000 in contributions, his office says.) And his district has shifted from slightly Republican to slightly Democratic.

“It’s no coincidence the National Republican Congressional Committee has named me as the No. 1 target next year,” Grayson said. “We’re working hard, getting things done.”

Swagger courses through Grayson’s every word, delivered in the accent of his Bronx upbringing and with the exacting nature of a lawyer who first made his name taking on — and taking down — contractors and war profiteers in Iraq.

“I don’t need the job for income or satisfaction,” said Grayson, sitting on a bench outside the House chamber in between votes. “The truth is, it’s really a hardship. I took an enormous pay cut to take the job. Every week, I leave five young children and my wife to come up here.

“I don’t owe anything to anyone here. I don’t owe anything to lobbyists. I don’t owe anything to leadership. The only thing I owe to anybody is the well-being of 800,000 people who depend on me.”

…snip…

[His] self-assurance is best captured on the Financial Services Committee, where he has aggressively interrogated Federal Reserve officials and financial executives on federal bailouts and the economic morass.

In a memorable exchange, Grayson laughs at Fed Chairman Ben Bernanke as he tries to explain why the government would loan $500 billion to foreign banks.

The performances have made Grayson an Internet sensation, a champion for a public buried under credit card debt and foreclosures.

…snip…

Working full time as a lawyer until joining Congress, Grayson made a name filing whistle­blower lawsuits on contractor fraud and war profiteering in Iraq. The cases, involving big names like Halliburton and Custer Battles, were met with resistance from the Bush administration. Grayson said he was subjected to gag orders and stalling tactics. His quest garnered national attention, including a profile in the Wall Street Journal, which said he was waging a “one-man crusade,” and an extensive piece in Vanity Fair, where Grayson disclosed he liked to dress flamboyantly to hold a jury’s attention.

The experience, Grayson said, stirred his interest in politics and his antiwar stand played prominently in two runs for Congress, including an unsuccessful bid in 2006.

“Nobody can say you volunteered to be disabled the rest of your life. Nobody can say you volunteered to die and leave behind your wife and children. It’s wrong. It’s colonialism,” he said, starting to cry. Recently he was one of only a handful of Democrats, and the only from Florida, to vote against further funding of the war.

…snip…

It was Grayson who recently discovered that taxpayers have been paying legal bills for three former Fannie Mae executives accused of manipulating the books. “When did Uncle Sam become Uncle Sap?” Grayson mused to the New York Times.

But Grayson seems to constantly detract attention from any successes he may have. He is a political operative’s dream, offering a stream of outlandish statements.

During an August fundraiser he said that former Vice President Dick Cheney liked to “shoot old men in the face.” At a blogger convention that same month he said Keller’s campaign staff “spent all their time flying paper clips at each other and watching porn on their computers.” Rush Limbaugh? “A has-been hypocrite loser.”