Freddie Mac & Fannie Mae~~"Let them fail"

[Teresa Heilevang]

'Let them fail'

Government bailouts of Freddie and Fannie like giving candy to problem children.

"Let them fail," says Libertarian Party spokesperson Andrew Davis, referring to the mortgage institutions Freddie Mac and Fannie Mae, who the Bush administration has said it plans to rescue from financial collapse.

"Let them fail, and let them learn from their mistakes on their own dime," says Davis. "Bailing out these two institutions will only delay the inevitable outcome of any financial firm insulated from the market by government backing. The long run damage of continuing a policy of bailouts far exceeds any short term woes in letting the market consume failing institutions."

The Libertarian Party is calling for an end to government bailouts, which it equates to nothing more than welfare for businessmen.  The Party believes that government support of these institutions decreases the incentive to make responsible decisions, and unfairly socializes the risk--putting taxpayers on the line for costly mistakes.

"It's like giving more candy to problem children," says Davis. "Lenders should recognize that there are repercussions for risky loans, and borrowers should realize that there are consequences for taking loans they can't repay. If it's financial collapse, or having your house foreclosed--so be it. It's bad economics to remove the incentives, even if they are negative, which encourage sensible and responsible decisions."

The Party says Freddie and Fannie should be fully independent of government support, and subject to the same levels of market competition other firms face.

"I could not agree more with the editorial page of yesterday's Financial Times when it said that the current structure of these institutions cannot be maintained, and that government should prepare a 'decent burial' for them," says Libertarian Party National Chairman William Redpath.  "Freddie and Fannie are not needed for mortgage finance in the United States.  No credible commentator thinks that the failure of these two institutions would add even as much as one percentage point over the long-term to mortgage rates.  Congress and the President need to quickly move Fannie and Freddie to privatization with no strings attached to the federal government and taxpayer."

The Libertarian Party is America's third largest political party, founded in 1971 as an alternative to the two main political parties.  You can find more information on the Libertarian Party by visiting www.LP.org. The Libertarian Party proudly stands for smaller government, lower taxes and more freedom.

[Teresa Heilevang]

Fannie Mae and Freddie Mac Invest in Democrats
Published by Lindsay Renick Mayer on July 16, 2008

The federal government recently announced that it will come to the rescue of Freddie Mac and Fannie Mae, two embattled mortgage buyers that for years have pursued a lobbying strategy to get lawmakers on their side. Both companies have poured money into lobbying and campaign contributions to federal candidates, parties and committees as a general tactic, but they've also directed those contributions strategically. In the 2006 election cycle, Fannie Mae was giving 46 percent of its total $1.3 million in contributions to Republicans, who controlled Congress at that time. This cycle, with Democrats in control, they've reversed course, giving the party 56 percent of their total $1.1 million in contributions. Similarly, Freddie Mac has given 53 percent of its $555,700 in contributions to Democrats this cycle, compared to the 44 percent it gave during 2006.

Fannie Mae and Freddie Mac have also strategically given more contributions to lawmakers currently sitting on committees that primarily regulate their industry. Fifteen of the 25 lawmakers who have received the most from the two companies combined since the 1990 election sit on either the House Financial Services Committee; the Senate Banking, Housing & Urban Affairs Committee; or the Senate Finance Committee. The others have seats on the powerful Appropriations or Ways & Means committees, are members of the congressional leadership or have run for president. Sen. Chris Dodd (D-Conn.), chairman of the Senate banking committee, has received the most from Fannie and Freddie's PACs and employees ($133,900 since 1989). Rep. Paul Kanjorski (D-Pa.) has received $65,500. Kanjorski chairs the House Financial Services Subcommittee on Capital Markets, Insurance and Government-Sponsored Enterprises, and Freddie Mac and Fannie Mae are government-sponsored enterprises, or GSEs.

Top Recipients of Fannie Mae and Freddie Mac
Campaign Contributions, 1989-2008



Name
 Office
 Party/State
 Total
 
1. Dodd, Christopher J
 S
 D-CT
 $133,900
 
2. Kerry, John
 S
 D-MA
 $111,000
 
3. Obama, Barack
 S
 D-IL
 $105,849
 
4. Clinton, Hillary
 S
 D-NY
 $75,550
 
5. Kanjorski, Paul E
 H
 D-PA
 $65,500
 
6. Bennett, Robert F
 S
 R-UT
 $61,499
 
7. Johnson, Tim
 S
 D-SD
 $61,000
 
8. Conrad, Kent
 S
 D-ND
 $58,991
 
9. Davis, Tom
 H
 R-VA
 $55,499
 
10. Bond, Christopher S 'Kit'
 S
 R-MO
 $55,400
 
11. Bachus, Spencer
 H
 R-AL
 $55,300
 
12. Shelby, Richard C
 S
 R-AL
 $55,000
 
13. Emanuel, Rahm
 H
 D-IL
 $51,750
 
14. Reed, Jack
 S
 D-RI
 $50,750
 
15. Carper, Tom
 S
 D-DE
 $44,389
 
16. Frank, Barney
 H
 D-MA
 $40,100
 
17. Maloney, Carolyn B
 H
 D-NY
 $38,750
 
18. Bean, Melissa
 H
 D-IL
 $37,249
 
19. Blunt, Roy
 H
 R-MO
 $36,500
 
20. Pryce, Deborah
 H
 R-OH
 $34,750
 
21. Miller, Gary
 H
 R-CA
 $33,000
 
22. Pelosi, Nancy
 H
 D-CA
 $32,750
 
23. Reynolds, Tom
 H
 R-NY
 $32,700
 
24. Hoyer, Steny H
 H
 D-MD
 $30,500
 
25. Hooley, Darlene
 H
 D-OR
 $28,750
 


Includes contributions from PACs and individuals.
2008 cycle totals based on data downloaded from the
Federal Election Commission on June 30, 2008.

[CurrieS103]

Concur..let them fail and NOT be bailed out by the taxpayer!

[Neon Knight Anubis]

Here's a little video from Glenn Beck (okay its 8 mins) but it has some interesting info:

http://edition.cnn.com/video/#/video/bestoftv/2008/07/17/gb.fannie.freddie.cnn?iref=videosearch

*I should add that CNN videos take a little while to load so it'll take a sec.

[twyacht]

The funny thing is the Fannie mae/Freddie mack existence,;;;,.... whats wrong with a "privately owned. gov't run organization?
It's a misnomer,..They are not subject to SEC regs. or state and fed taxes. and they still are failing.

A free market has winners and losers, but a portion of our US Gov't, wants to save those business's that were part of the problem to begin with, to avoid economic "consequences",... oh and who pays for it?

It's called socialism,... and it failed,,, did anyone in gov't notice?  ........and we (taxpaying Americans), still pay for it.

"Today, we need a nation of Minutemen, citizens who are not only prepared to take arms, but citizens who regard the preservation of freedom as the basic purpose of their daily life and who are willing to consciously work and sacrifice for that freedom."
John F. Kennedy

Hadn't heard that quote  in a while,.... quite a concept,...it seems politicians, regardless of party, forgot quite a few things.

[Sponsor]

[CurrieS103]

The funny thing is the Fannie mae/Freddie mack existence,;;;,.... whats wrong with a "privately owned. gov't run organization?
It's a misnomer,..They are not subject to SEC regs. or state and fed taxes. and they still are failing.

A free market has winners and losers, but a portion of our US Gov't, wants to save those business's that were part of the problem to begin with, to avoid economic "consequences",... oh and who pays for it?

It's called socialism,... and it failed,,, did anyone in gov't notice?  ........and we (taxpaying Americans), still pay for it.

"Today, we need a nation of Minutemen, citizens who are not only prepared to take arms, but citizens who regard the preservation of freedom as the basic purpose of their daily life and who are willing to consciously work and sacrifice for that freedom."
John F. Kennedy


Hadn't heard that quote  in a while,.... quite a concept,...it seems politicians, regardless of party, forgot quite a few things.

And the Federal Reserve is a private entity...We've been putting up with that since 1913!