A veteran fighter for gay rights has come under fire for his role in the current crisis in the financial markets.

Barney Frank, chairman of the US House of Representatives Financial Services panel, hit back yeserday, mocking Republican representatives for blocking an attempt to inject hundreds of billions of dollars into the American economy.

He was one of the architects of the bailout plan.

Some Republican Congressmen claimed that a speech by Houser Speaker Nancy Pelosi was overtly partisan and that put them off voting for the rescue package.

“Here’s the story: There’s a terrible crisis affecting the American economy,” Congresman Frank said yesterday after Congress voted to reject the bailout plan.

“We have come together on a bill to alleviate the crisis.

“And because somebody hurt their feelings they decide to punish the country. I mean, I would not have imputed that degree of pettiness and hypersensitivity….But think about this: Somebody hurt my feelings so I will punish the country.

“I mean, that’s hardly plausible. And there are 12 Republican members who were ready to stand up for the economic interests of America, but not if anybody insulted them.

“I think they are covering up the embarrassment of not having the votes.”

The failure of the $700bn rescue package threw the markets into turmoil yesterday, with the Dow Jones losing 770 points, the largest one-day fall in its 38-year history. The Nasdaq index fell 9.1%.

140 Democrats voted for the measure, which Mr Frank helped devise, along with 65 Republicans.

95 Democrats voted no, along with 133 Republicans.

Congress will meet again on Thursday, after a break for the Jewish New Year, and is unlikely to vote on a new rescue package until the weekend.

Representative Frank has represented the 4th District of Massachusetts since 1981, and is the only out gay man in the House of Representatives.

The Harvard-educated lawyer has a sharp tongue and is consistently voted one of the funniest members of the House.

He came out in 1987, and his political opponents have tried to smear and unseat him on many occasions. Many opponents thought he was politically dead after a rent boy scandal in 1990.

Attempts to expel him failed – the House voted 408-18 to reprimand him instead.

The people of his district stuck with him through the scandal – he won re-election in 1990 with 66% of the vote. In 2006 he ran unopposed.

In 1998, he founded the National Stonewall Democrats, a gay, lesbian, bisexual, and transgender Democratic pressure group.

He was appointed as chairman of the powerful Financial Services Committee at the start of the 110th Congress in January 2007, and has come under fire for his role in the crisis.