Fannie and Freddie’s Huge Christmas Bonus
By Larry Doyle on December 26, 2009 at 12:43 PM in Bailouts, Current Affairs, Economy, Fannie Mae, Freddie Mac, Housing & Housing Crisis, Sense on Cents (Larry Doyle blog)
While Americans across the country hustled and bustled for last minute gifts and holiday preparations, our wizards in Washington tied a big red ribbon on a blank check made out to Freddie Mac and Fannie Mae. In the process, a future of socialized housing finance has been increasingly solidified.
Why would the Obama administration pass this blank check under the cover of darkness on December 24th? In hopes that America had just settled down for its long winter’s nap and would miss this act of pillage and plunder. The Wall Street Journal highlights this ‘blank check’ in writing, U.S. Move to Cover Fannie, Freddie Losses Stirs Controversy:
The Obama administration’s decision to cover an unlimited amount of losses at the mortgage-finance giants Fannie Mae and Freddie Mac over the next three years stirred controversy over the holiday.
The Treasury announced Thursday it was removing the caps that limited the amount of available capital to the companies to $200 billion each.
Unlimited access to bailout funds through 2012 was “necessary for preserving the continued strength and stability of the mortgage market,” the Treasury said. Fannie and Freddie purchase or guarantee most U.S. home mortgages and have run up huge losses stemming from the worst wave of defaults since the 1930s.
“The timing of this executive order giving Fannie and Freddie a blank check is no coincidence,” said Rep. Spencer Bachus of Alabama, the ranking Republican on the House Financial Services Committee. He said the Christmas Eve announcement was designed “to prevent the general public from taking note.”
Let’s ponder this development for a second. What exactly does unlimited access truly mean?
1. A lack of discipline and accountability in the distribution of taxpayer funds.
2. A full government takeover of the U.S. housing finance industry.
3. A socialized housing policy and program.
If those developments do not revile you enough, the blank check is also a confirmation of the following:
1. A failed housing policy developed and promoted over the last twenty years.
2. The true legacy of those who fed from the Freddie and Fannie trough during the last two decades. Which legislative leaders piled their plates the highest with Freddie’s and Fannie’s payoffs? John Kerry (D-MA), Chris Dodd (D-CT), and Barack Obama.
Are you sick yet?
Blank checks are no way to run a country!! Capitalism has been under assault all year long and this year end shot is the ultimate kick in the balls.
These bums must be thrown out.
LD
by Ronald Scott
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