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Treasury "Doesn't" Socialize Mortgage Lending Giants
Dateline - Washington, DC September 8, 2008
With their business models insolvent, The US Treasury yesterday placed mortgage lenders Fannie Mae and Freddie Mac under the conservatorship of the Federal Government. In a speech yesterday, Federal Housing Finance Agency Director Jim Lockhart outlined a four point plan developed by the FHFA and Treasury designed to avert "...great turmoil in our financial markets here at home and around the globe." (link)
"The Preferred Stock Purchase Agreements minimize current cash outlays, and give taxpayers a large stake in the future value of these entities. In the end, the ultimate cost to the taxpayer will depend on the business results of the GSEs going forward," continued Lockhart, "To that end, the steps we have taken to support the GSE debt and to support the mortgage market will together improve the housing market, the US economy and the GSEs' business outlook."
In response to this drastic action, WNN contacted GOP Vice Presidential Candidate Sarah Palin to see get her stance on the bailout of the mortgage giants.
"I stand by my assertion that Fannie and Freddie have gotten too big, and too expensive to the taxpayer," replied Palin, echoing her statements from a campaign rally only days ago, "The Treasury has done the only fiscally prudent thing it could to solve this crisis: make them bigger and more expensive to the American taxpayer. Barack Obama probably doesn't think that makes sense, but maybe if he would have spent a little less time organizing communities and a little more time in a POW camp for 5 years, like my running mate John McCain, he'd realize a sound fiscal policy when he saw it."
But doesn't such a policy border on the same socialist tendencies that many have accused Obama as pushing? John McCain begs to differ.
"Well, I don't think so," McCain told WNN, "Remember, the primary goal of Socialist policies, like universal health care, is to redistribute wealth to the lower classes, in an attempt to equal out the playing field for everyone and provide a higher standard of living for the lower classes at the expense of the upper class. I support the conservatorship of Freddie and Fannie because it uses taxpayer money in order to generate wealth for mortgage lenders. It's sound, prudent Republican fiscal policy."
As for long term solvency, Treasury Secretary Paulson stated Sunday that the administration's plan for conservatorship was not merely a way to stall until after the elections, but a way for this administration to provide for future stability.
"The new Congress and the next administration must decide what role government in general, and these entities in particular, should play in the housing market."
For WNN, this is Ihatethis Sohard reporting.
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Last Updated: May 20, 2011 Copyright 2011 - Infinity, Waldo News Network. All Rights Reserved.
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