On Fannie, Freddie, and the candidates during this economically challenging election season.
Posted by Tina
Things economic are not always easily understood. So when I found an article that I just got it was like breathing fresh air after a couple of weeks of smoke! Mr. Rove has written such a piece, Voters Want Economic Leadership, in the online version of the Wall Street Journal.
If you crave some insight into the Fannie/Freddie mess, particularly in light of the coming election, I urge you to breath in the very readable and fair minded, Karl Rove:
Now with Fannie and Freddie at greater risk, Messrs. McCain and Obama need to think like would-be presidents instead of senators. That starts with ignoring former Fannie CEO Franklin Raines, who says reform isn’t needed this from a CEO who couldn’t produce accurate accounting statements. The goal has to be to force the GSEs (gov. sponsored enterprises) into a position where they can no longer put taxpayer dollars at risk. *** A wag once said that Fannie and Freddie were political organizations masquerading as mortgage providers. They donate heavily to politicians who can shield them from regulation. This election the GSEs have given more than $800,000 to congressmen and senators who oversee legislation that affects them. They have also snapped up dozens of retiring lawmakers and staff as lobbyists and pay them lucrative salaries. Not bad for part-time, indoor work. *** Over the past decade, the GSEs spent at least $171 million on lobbying, which combined would make Fannie and Freddie the third-biggest lobby. This has fostered a network of co-conspirators, including the liberal low-income advocacy group Acorn, big-city mayors and some lenders. Any reform must avoid creating more slush funds for the GSEs to reward political allies at taxpayer expense, and prevent them from investing in “jumbo” mortgages on expensive houses. After all, these GSEs were created to help lower- and middle-income homebuyers, not the rich and famous.
You may recall my postings about the liberal organization ACORN. Community service work is supposed to be their thing but they have also been investigated for voter fraud. Some of these investigations have resulted in guilty verdicts.