DCBill

How Much Are Fannie and Freddie to Blame?

Peter Wallison has made plenty of money and earned his Right Wing "eagle badge" peeing on Fannie and Freddie, but in his zeal to score "McCain points"--which likely will be a losing effort come Nov. 4--Wallison overlooks many crucial facts.

--The Bush campaign machine called for the "ownerhsip society" and enlisted Fannie and Freddie in that effort, at times taking direct credit for the companies' efforts.

--All of the major D's (Johnson, Raines, Gorleick, et al) were long gone when the company stepped in deep caca, through purchases of Alt A and subprime securities. They refused to originate the stuff, but Dan Mudd (a life long Republcian and McCain contributor) wanted it on the Fannie Mae books and his mistake cost him his job and the company it's structure and private ownership.

Mudd made the same mistake as the managers of Bear, Merrill, WAMU, Wachovia, AIG and dozens more. There was nothing unique in the greed that drove subprime security purchases

Don't forget, when Fannie was atken over, it had cleaned up its books and was SEC compliant. It also had OFHEO officals in its operational offices 24-7, blessing every significant business action and deal, so
who was responsible for what? It was hardly Barney Frank and Chris Dodd.

Fannie's major errors came in 2005-2007, when no Democrats were in authority. Sorry Peter.