Barney Frank, key lawmaker during financial crisis, dies at 86

Barney Frank, the quick-witted Democratic congressman who found himself on the front lines of the government's rescue of the American financial system in 2007 and 2008, has died. He was 86.

He died on Tuesday at his home in Ogunquit, Maine, the Boston Globe reported, citing a longtime friend, Jim Segel. Politico had reported in April that he had entered hospice care at home while dealing with congestive heart failure and writing one last book. 

Frank was well into his third decade representing Massachusetts' fourth district — and well known as the first member of Congress to have voluntarily identified as gay — when he assumed the chair of the House Financial Services Committee at the start of 2007. He hoped to expand rental housing for low-income Americans and address the stagnation of working-class wages, just the sort of progressive pursuits that had inspired him to abandon his Ph.D. studies and go into politics some 40 years earlier. 

A few months into his chairmanship, however, large losses on mortgage-related financial assets reached crisis level for American banks. With the financial system in disarray, Frank worked closely with two powerful Republicans in President George W. Bush's administration, Treasury Secretary Hank Paulson and Federal Reserve Chair Ben Bernanke, to craft the $700 billion Troubled Asset Relief Program, which became a widely resented government bailout of banking institutions and automakers. Acknowledging its complicated legacy, Frank called TARP "one of the most successful and unpopular things the federal government ever did."

Savior of big banks was not a role that came naturally to Frank. He hadn't come to Congress "to referee fights between rich people," he explained years later. He spoke often about government's responsibility to counter widening economic inequality. 

But a practical streak ran through his mostly liberal record. Paulson called him "a pragmatic, disciplined, completely honorable politician" whose "main interest was in doing what he believed was best for the country."

With Senator Christopher Dodd of Connecticut, a fellow Democrat, Frank wrote the most sweeping change in U.S. financial regulation since the Great Depression — the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. It created a new regulator, the Consumer Financial Protection Bureau, within the Federal Reserve; a new Treasury Department body, the Financial Stability Oversight Council, to monitor risks to the financial system; and a requirement that banks undergo stress tests to ensure they have enough capital to withstand a recession. 

In 2018, five years after Frank retired, Congress passed and President Donald Trump signed a partial rollback of Dodd-Frank that freed smaller banks from some of its more burdensome requirements and loosened rules aimed at protecting the biggest banks from sudden collapse. Frank opposed Trump's changes but said he found them relatively modest, leaving Dodd-Frank mostly intact. 

"It does not in any way weaken the regulations we put in there for the largest banks, or that were there to prevent the kind of crisis we had 10 years ago," Frank told CNBC. 

Rumpled suits

A haberdasher's nightmare of rumpled suits, unkempt hair and belching cigars, Frank brought a rapier wit and mastery of parliamentary procedure into his political battles. He relished decimating opponents if, in his view, they were ill-prepared, arguing in bad faith or dead wrong about an issue. 

Iowa Republican Jim Leach, whom Frank succeeded as the Financial Services Committee chair, called Frank "probably Congress's smartest member in sheer IQ." 

Frank was hardly oblivious to the pleasure of being right. "Never believe anyone who says, 'I hate saying I told you so,'" he wrote in his 2015 autobiography, Frank. "Saying 'I told you so' is always enjoyable and one of the few pleasures that becomes more enjoyable with age."

He voted as one of the most liberal members of Congress for his entire career, but attacked allies as readily as his adversaries, often lambasting the "inconsistent absolutism" of the far-left flanks of the Democratic party that equated his pragmatist legislating with surrender. In his final months, he was working on a book critical of progressive Democrats, who, he said, had embraced "an agenda that goes beyond what is politically acceptable."

Republicans pushed back on Frank's image as a rescuer of the financial system. They pointed out that, as top Democrat on the Financial Services Committee in the years leading up to the 2008 crisis, Frank had resisted efforts to rein in Fannie Mae and Freddie Mac, the government-sponsored enterprises that finance mortgages in the U.S. Their growth was seen as a contributing cause to the financial crisis, and they had to be bailed out by the government. 

During one hearing in 2003, Frank argued against regulating Fannie and Freddie as tightly as banks. "I want to roll the dice a little bit more in this situation towards subsidized housing," he said, a quote that provided fuel to his critics.

Missed signs

Frank acknowledged missing early signs of a housing bubble but noted that Republicans ran the House for much of George W. Bush's presidency, during which the bubble expanded and finally burst. "I was late in recognizing the problem," Frank said in 2011 as he announced his plan to retire from Congress. "But it was when I was in the minority."

In an awkward coda to his work safeguarding the banking system, Frank was on the board of New York-based Signature Bank when regulators shut it down in March 2023 following a run by worried depositors. 

Barnett Frank was born on March 31, 1940, in Bayonne, New Jersey, the second of four children. His father, Samuel Frank, ran a truck stop in Jersey City. His mother, Elsie, became a popular feature of his campaign ads in the 1980s and a prominent advocate for seniors.

In his 20s, Frank officially changed his first name to Barney. His older sister, Ann Lewis, would also go into politics, serving as director of communications for President Bill Clinton and a senior adviser for Hillary Clinton's 2008 presidential campaign. 

Frank said he was inspired to join politics in part by watching live telecasts of the 1954 Army-McCarthy hearings. "The fast-paced verbal combat I'd seen on TV appealed to me," he recalled. "I was good at talking in class, arguing politics and sports with my peers, and making people laugh, often at the expense of my debate adversaries."

"But I was a Jewish homosexual," which in the 1950s meant he had two strikes against him if he was to seek elected office, he wrote.

Mayor's office

Frank left New Jersey for Harvard University, earning a bachelor's degree in 1962 and staying on to teach government and work toward a Ph.D. He spent the summer of 1964 in Mississippi volunteering for the Freedom Summer voter registration campaign.

He left Harvard before finishing his doctorate to work as chief of staff to the Boston mayor, Kevin White. He then spent a year in Washington as administrative assistant to an anti-war Democratic congressman from Massachusetts, Michael Harrington.

In 1972, at 32, Frank was elected to the Massachusetts House of Representatives. During his eight years in the Legislature, he earned his law degree from Harvard.

Disproving his earlier beliefs about what "a Jewish homosexual" could do in politics, Frank in 1980 ran successfully for the House seat vacated by Robert Drinan, a Catholic priest who had followed a directive from Pope John Paul II for all clergy to leave elected office. 

Frank's close ties to House Speaker Tip O'Neill, a fellow Massachusetts Democrat, paid off with an appointment to what was then called the House Banking Committee, which dealt with housing, Frank's top interest.  

By 1986, colleagues and friends and even some journalists were aware that he was gay, Frank said, but he wasn't yet ready to share that publicly. That changed when a former congressional colleague — Robert Bauman, a Republican — wrote a memoir about his own homosexuality and hinted that Frank was gay as well. In the first months of 1987, Frank divulged his sexual orientation to the Boston Globe. He said the response in Massachusetts and the nation's capital was "overwhelmingly supportive."

Reprimand vote

That support was tested in 1989 when a male prostitute in Washington revealed that he had run an escort service out of Frank's Capitol Hill apartment. Frank admitted to having had a relationship with the man, Stephen Gobie, but said he had fired Gobie once he learned clients were visiting the apartment. 

Following an investigation by its ethics committee — which found, among other things, that Frank had fixed 33 parking tickets for Gobie — the House voted overwhelmingly to reprimand Frank rather than censure or expel him, as many Republicans hoped. 

Frank expressed regret and said the pressures of hiding his sexual orientation had caused him to "act stupidly."

Frank became a high-profile advocate in Congress for gay and lesbian equality. In one of his better-known quips, he complained in 2000 that independent counsel Kenneth Starr's report on the possible impeachment of President Bill Clinton required "too much reading about heterosexual sex." 

In 2012 he became the first sitting member of Congress to enter into a same-sex marriage, wedding his longtime partner, Jim Ready.