In a September 30 post on the Politico blog The Crypt, Daniel Libit uncritically repeated former House Speaker and Fox News contributor Newt Gingrich's false claim that Democrats wanted “provisions to provide money to” the Association of Community Organizations for Reform Now (ACORN) in the financial bailout bill. Libit did not challenge the claim, despite his colleague Ryan Grim's having noted in a September 28 post, also on The Crypt, that ACORN “was not specifically directed any funds in the ... proposal.” Moreover, on September 27, Grim quoted a spokesman for Rep. Barney Frank (D-MA) stating that "[a]bsolutely none" of the potential bailout profits would be earmarked for ACORN.

As Media Matters for America has documented, in recent days, media figures have falsely accused Democrats of attempting to direct millions of dollars to ACORN. Under the provision, ultimately removed from the version of the bill that the House rejected on September 29, 20 percent of any profits realized on troubled assets purchased under the bill would go to two funds -- the Housing Trust Fund*, to be distributed by the Department of Housing and Urban Development in the form of block grants to states, and the Capital Magnet Fund, from which the U.S. Treasury Department would award grants.

From Libit's September 30 post:

Gingrich sharpened his attack from the last few days on Treasury Secretary Henry Paulson, who he against called on to resign from his post. Paulson, Gingrich said, “represents a very narrow Wall Street view.” Gingrich also cast a large share of the blame upon “liberal Democrats,” and took a numerous shots [sic] at provisions to provide money to ACORN.

The former Speaker said he was surprised that that the bill hadn't passed, finding out after he touched down yesterday in Oklahoma City. He added that he “thought Sen. [John] McCain had empowered [House Minority Leader John] Boehner [R-OH] and the Republicans.”

From Grim's September 28 post:

After several days of rage from conservative activists regarding a provision in the bailout bill that would send some of the profits from the sale of distressed assets the goverment [sic] buys into an affordable housing trust fund, congressional negotiators have removed section 105(d) of the bailout proposal, according to aides on both side.

ACORN, a Democratic ally, was not specifically directed any funds in the previous proposal, but money that went to state and local governments could then have been divvied out to the organization, which the GOP said was a deal breaker. Fevered opposition to the provision had become a viral sensation.

From Grim's September 27 post:

“The draft bill includes a left-wing giveaway that would force taxpayers to bankroll a slush fund for a discredited ally of the Democratic Party,” reads one [Republican] leadership alert. “At issue is ACORN, an organization fraught with controversy for, among other scandals, its fraudulent voter registration activities on behalf of Democratic candidates. Rather than returning any profits made in the long-term from the economic rescue package, Democrats want to first reward their radical allies at ACORN for their (often illegal) help in getting Democrats elected to office.”

In the end, how much of the bailout's potential profits are earmarked for ACORN? “None. Absolutely none. All funds would go to state and local governments,” said Steven Adamske, spokesman for Rep. Barney Frank (D-Mass.), the chairman of the Financial Services Committee and a lead negotiator.

The opposition has grown so intense that critics refer to the measure in arcane legislative lingo. Erick Erickson titled a Friday morning blog post at RedState: “Section 105(d) of the Bailout Must Go.”

*Name corrected.