“On July 27, 2000, a first-term Congressman [Paul Ryan] from Wisconsin signed his name to the Housing Finance Regulatory Improvement Act. The 30-year-old legislator didn't have much company. Of 435 Members of the House, only 12 were willing to join Paul Ryan in sponsoring a bill to reduce the taxpayer risks at Fannie Mae and Freddie Mac.
Eight years later to the day, a federal bailout of the two mortgage giants was on its way to the desk of President George W. Bush. Almost $190 billion in taxpayer financing later, the toxic twins of the housing crisis maintain their massive role in mortgage finance.
On Friday, the U.S. Treasury said it is relieving the two government-sponsored enterprises of the requirement to pay regular dividends to taxpayers. Instead, the toxic twins will simply pass to the feds any profits they make. Fan and Fred's investment portfolios will also have to shrink more quickly, which is very good. But the deal suggests that they will continue to slap taxpayer-backed guarantees on mortgage bonds forever, or until there's a reformer in the White House.”.
Obama and Biden who were in the Senate in the mid-2000s did nothing, but later complain about the mess they inherited. I looked through v.1 of the testimony in 2000 and see Maxine Waters was quite hostile to the idea of reforming or restricting F&F.
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