Exclusive Interview: Rep. Barney Frank

As Chairman of the House Financial Services Committee, Representative Barney Frank (D-Mass)is one of the most powerful legislators in Washington. His committee oversees many industries and sectors key to both the financial markets and business.

CNBC's Mary Thompson sat down with Rep. Frank in late March for an in-depth and wide-ranging interview. In this special four-part series, Frank talks about CEO pay, the subprime lending mess, reforming Sarbanes-Oxley and U.S. competitiveness. But that's not all. Frank also discusses some important personal issues that deeply define his life and career. Here are excerpts of our special four-part interview.

Part One

Rep. Frank talks about assuming the chairmanship of the committee and some of his plans and goals.

Executive Pay

"When we come back from the Congressional recess, I hope to have on the floor the executive compensation bill, which is not Congress telling anybody anything but in fact letting the shareholders express their opinion on compensation which is a shareholder democracy bill not an intrusive Congressional fiat."

Spreading The Wealth

""We have a terrible problem in America and elsewhere in the world which is economic growth in its current form through globalization and technological change and increased productivity is going forward but it is increasing two things -- total wealth but inequality. And obviously you don't want equality in a capitalist system, you need some inequality but we've gone beyond what's healthy."

Rep. Frank also discusses how Sarbanes-Oxley might be watered down, the need for more affordable housing and changes in the Federal Housing Administration.

Part Two

Rep. Frank talks about the origins of the subprime lending mess and a crackdown on lenders as well as the dark side of the "American Dream " of home ownership.

Subprime Mortgages

The subprime lending mess already appears to be spilling over into the broader housing market and Congress has already held public hearings on the issue.

"There will be some people who are higher risk and if the private sector lends to them they are going to have to pay more but there ought to be some prudent limits on what you lend,"  says Frank. "You shouldn't be lending people money that they are very unlikely to pay back in the hopes that when you take over the home it will be worth more than when you lent it to them. That’s not just a problem for that individual. it has negative social consequences and I think we need to restrict it."

Home Ownership

Current mess aside, there are still supporters of a subprime market, partly because it opens home ownership to more people.

"Why is the American Dream only if you own a home," asks Frank. "I wish everybody in America was wealthy enough so that housing was available but there are tens of millions of Americans who don't earn enough money to own a home, particularly if they live in high cost areas. I wish it were different but it's a grave mistake. I think it is part of our problem to say that everyone must own a home."