Democrats Failure to Reform Fannie and Freddie Will Come Back to Haunt Them
Washington – Carol Shea-Porter and her Washington friends already opened up the nation’s pocketbook once to bailout Fannie Mae and Freddie Mac – the catalyst of the mortgage crisis – and now the mortgage giants may need anywhere from $73 to $215 billion in additional handouts just to keep afloat. The Democrats’ failure to reform and restructure the two companies is now going to cost taxpayers more money, further contributing the nation’s economic woes and signifying the spending problem that has become a signature of the out-of-touch majority.
“Carol Shea-Porter's runaway spending spree has led this nation into unprecedented debt,” said NRCC Communications Director Ken Spain. “The economy is spiraling out of control and rather than focusing on getting it back on track, House Democrats have continued to feed their spending addiction on the taxpayer dime by refusing to address the next crisis at Fannie and Freddie. With Election Day quickly approaching, middle-class families will remember the Democrats’ destructive economic agenda that has placed heavy financial burdens on them and led the nation further into debt.”
“Fannie Mae and Freddie Mac may need as much as $215 billion in additional capital from the Treasury through 2013 to offset losses and maintain a positive net worth, their federal regulator said on Thursday.
“Fannie Mae and Freddie Mac, whose programs fund the lion's share of all new home loans, are at the center of debate as Congress sets to overhaul a U.S. mortgage finance system that contributed to the worst housing crisis since the 1930s.” (Al Yoon, “Fannie and Freddie May Need Another $215 Billion,” ABC News, 10/21/2010)
According to the Wall Street Journal Fannie and Freddie have already cost taxpayers a combined $135 billion and will cost them an additional $19 billion over the next three years.
“Fannie Mae and Freddie Mac could cost taxpayers another $19 billion over the next three years, the bailed-out mortgage titans' regulator said Thursday, but the total tab could nearly double if the U.S. economy slides back into a recession.
“The projections by the Federal Housing Finance Agency were based on the results of ‘stress tests’ it ran on Fannie and Freddie, whose woes have already cost taxpayers a combined $135 billion.” (Nick Timiraos, “Regulator Says Fannie, Freddie Cost at Mercy of Economy,” Wall Street Journal, 10/21/2010)