U.S. Rep. Connie Mack hit the campaign trail this week to bash Newt Gingrich for saying little about his profitable ties to mortgage giant Freddie Mac — a potent issue in foreclosure-racked Florida.
But when it comes to Mack's profits from Freddie Mac's cousin agency, Fannie Mae, the congressman was mum.
"What's important here is what Newt Gingrich did for Freddie Mac," said Mack, a Republican U.S. Senate candidate from Fort Myers who is campaigning for Romney.
The Romney campaign made Gingrich's estimated $1.6 million Freddie Mac consulting work an issue because it was a two-fer: It showed Gingrich was a Washington insider and it has the potential to stoke resentment in a state where one in 360 properties is in foreclosure.
But the attack also had a boomerang effect.
At Thursday's Republican presidential debate, Gingrich said Romney had made $1 million from Freddie Mac and Fannie Mae bonds. Romney responded by noting that Gingrich also had invested with the mortgage giant.
Mack and his wife, California Rep. Mary Bono Mack, have turned a profit as well off Fannie Mae, a government-sponsored enterprise that, along with Freddie Mac, is blamed for stoking the mortgage crisis.
Like Romney, the Macks' profits were derived from bonds, not stocks. Romney also said his investments were made by a manager of a blind trust.
According to Mack's 2008 financial disclosure form filed with Congress, he and his wife held Fannie Mae bonds worth between $15,000 and $50,000 by the end of 2008.
The report also shows that the Macks sold more than $15,000 in Fannie Mae bonds on Sept. 30, 2008. The sale came just three weeks after the Bush administration took over Fannie Mae and a related mortgage industry titan, Freddie Mac, in an effort to prevent a potential financial meltdown. The government's move pummeled Fannie Mae stockholders, who lost their investments — but it benefited bondholders like the Macks, providing government backing to Fannie Mae's debts.
The Macks sold more of their Fannie Mae bonds in 2009, earning capital gains between $200 and $1,000, records show.
"How depressing politics has become when the most stunning accusation was that the Macks made between $200 and $1,000 in capital gains. Petty and sad," said David James, Mack's spokesman.
The Freddie Mac attack isn't the only Romney campaign issue that draws attention to Mack's time in Congress. Romney's campaign has hammered Gingrich for allowing hometown spending in the federal budget — a process known as "earmarking" that Mack participated in as well.
But Florida voters seem much more concerned with the housing industry than earmarks.
"In Florida, a lot of people lost their homes, their homes are under water, and they tie that to Freddie Mac," Mack said. "Speaker Gingrich has had an eight-year relationship with Freddie Mac, a contract with the lead lobbyist for $25,000 a month — $1.6 million."