SURPRISE! SURPRISE! Congress Bungles Fannie and Freddie Reform
Nearly five years after the government took over the mortgage giants Fannie Mae and Freddie Mac, Congress is slouching toward remaking how Americans buy homes.
Gingerly, Sens. Bob Corker, Republican of Tennessee, and Mark R. Warner, Democrat of Virginia, have been working up a bill. Yet it’s striking how much the process is being dominated by emotional battles and financial interests.
In the right corner — politically as well as figuratively — we have the contingent that despises Fannie Mae and Freddie Mac. These people continue, against the evidence, to consider them the central cause of the financial crisis. Their preferred solution is to wipe these companies from the earth and somehow get the government out of housing. The hope is that a thousand flowers will bloom on their graves, as private investors rush in to finance mortgages.
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