Gingrich, Romney hit each other over involvement in Fannie Mae and Freddie Mac

Republican presidential candidates former House Speaker Newt Gingrich and former Massachusetts Gov. Mitt Romney participate in the Republican presidential candidates debate at the University of North Florida in Jacksonville, Fla., Thursday, Jan. 26, 2012.
AP Photo/Matt Rourke

A question from an audience member about the future of Fannie Mae and Freddie Mac at Thursday night's CNN debate turned into a slugfest between House Speaker Newt Gingrich and former Massachusetts governor Mitt Romney. The two Florida front-runners hit each other over investments and relationships to the mortgage giants taken over by the government at the height of the financial crisis in 2008.

"We should have had a whistle blower not a horn tooter," Romney said about the former House speaker, who worked as an adviser to Freddie Mac, the smaller of the two organizations.

Gingrich accused Romney of "cheerfully" making attacks "inaccurately," noting that he was not a registered lobbyist for the firm.

Gingrich turned the table back on the former Massachusetts governor for his investment portfolio.

"We discovered to our shock, Governor Romney owns shares of both Fannie Mae and Freddie Mac. Governor Romney made a million dollars off of selling some of that," Gingrich said.

The two firms have taken close to $150 billion in taxpayer funds since they were seized.

Gingrich also said Romney "has an investment in Goldman Sachs" which is behind many of the foreclosures taking place in Florida.

"Maybe Governor Romney in the spirit of openness should tell us how much money he's made off of how many households that have been foreclosed by his investments," Gingrich said.

Romney said he did not control how his money was invested because a "blind trustee" manages his investments, adding that he did not own shares in Fannie Mae and Freddie Mac but rather had purchased their mortgage bonds, in effect lending money to the two beleaguered firms.

The firms, which were privately run until 2008, were frequently criticized because they could borrow money more cheaply than their private competitors because those who lent them money knew that their special status meant that the government would step in if trouble emerged.

He then turned his attention to Gingrich.

More from the debate:

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Gingrich, Romney agree to blame the Palestinians, Obama for lack of progress in the peace process
Gingrich hints at making Marco Rubio VP
Romney tells Gingrich: I'd fire you for your moon proposal

"What the speaker did is work as a spokesperson. He got paid $1.6 million to do that," Romney said, noting that Gingrich said his first contract indicated there would be no lobbying.

"But his second contract didn't have that prescription taken out of it. And so you have to ask yourself why is that? What he was doing was clearly promoting Fannie Mae and Freddie Mac," Romney said.

Rep. Ron Paul and former Senator Rick Santorum declined engaging in the back and the forth. Paul said the topic of Gingrich and Romney's business ties "doesn't interest me very much."

Santorum called it "petty, personal politics" and said Gingrich working for the mortgage lenders "is not the worst thing in the world."

Three of the four candidates failed to address the role of Fannie and Freddie in the housing market. Mitt Romney briefly touched on it but offered few details. "Are they a problem today? Absolutely," Romney said.

The Obama administration has proposed a slow wind-down of the firms over time, but has been reluctant to implement any quick changes for fear of doing further damage to the still struggling housing market.

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    Leigh Ann Caldwell is a political reporter for