Partisan Debate Over Fannie and Freddie's Future Heats Up
The Treasury Department's recent decision to delay a report on the future of the government-controlled mortgage giants Fannie Mae and Freddie Mac has sparked a heated debate between Republican and Democratic lawmakers. A deadline for the report was implemented by the Dodd-Frank Act,but Treasury failed to meet it.
Alabaman Representative Spencer Bachus, head of the House Financial Services Committee, said Wednesday that the administration "had no legitimate reason" for missing the deadline. "It is clear the Administration cannot make any tough choices required to protect taxpayers and end the bailout of Fannie and Freddie," Bachus's comments went on. "Taxpayers do not need more empty promises for reform, they need a real plan to stop the administration and Treasury Department from throwing more taxpayer dollars down the Fannie and Freddie rathole."
Fannie Mae and Freddie Mac, the two government controlled entities that together own or guarantee well over half of all US mortgages, have been surviving on the backs of the US taxpayer since being placed under government conservatorship in 2008 after losses tied to the subprime loan crisis nearly bankrupted them. Treasury has funneled more than $150 million into the two companies to date.
In response to Bachus's comments, Treasury spokesman Steve Adamske released the following statement: "The Republicans were in charge of Congress for 12 of the past 16 years and failed each and every year to send meaningful GSE underwriting or predatory lending reforms to the president's desk."
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