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The Fannie Mae Gang
Wall Street Journal ^ | 23 July 2008 | Paul Gigot

Posted on 07/23/2008 4:41:10 AM PDT by shrinkermd

...Fan and Fred also couldn't prosper for as long as they have without the support of the political left, both in Congress and the intellectual class. This includes Mr. Frank and Sen. Chuck Schumer (D., N.Y.) on Capitol Hill, as well as Mr. Krugman and the Washington Post's Steven Pearlstein in the press. Their claim is that the companies are essential for homeownership.

Yet as studies have shown, about half of the implicit taxpayer subsidy for Fan and Fred is pocketed by shareholders and management. According to the Federal Reserve, the half that goes to homeowners adds up to a mere seven basis points on mortgages. In return for this, Fannie was able to pay no fewer than 21 of its executives more than $1 million in 2002, and in 2003 Mr. Raines pocketed more than $20 million. Fannie's left-wing defenders are underwriters of crony capitalism, not affordable housing.

So here we are this week, with the House and Senate preparing to commit taxpayer money to save Fannie and Freddie. The implicit taxpayer guarantee that Messrs. Gray and Raines and so many others said didn't exist has become explicit. Taxpayers may end up having to inject capital into the companies, in addition to guaranteeing their debt.

The abiding lesson here is what happens when you combine private profit with government power. You create political monsters that are protected both by journalists on the left and pseudo-capitalists on Wall Street, by liberal Democrats and country-club Republicans. Even now, after all of their dishonesty and failure, Fannie and Freddie could emerge from this taxpayer rescue more powerful than ever. Campaigning to spare taxpayers from that result would represent genuine "change," not that either presidential candidate seems interested.

(Excerpt) Read more at ...

TOPICS: Business/Economy; Constitution/Conservatism; Editorial; Politics/Elections
KEYWORDS: bailouts; capitalism; crony; fanniemae; freddiemac; gigot; govwatch; maldef

1 posted on 07/23/2008 4:41:10 AM PDT by shrinkermd
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To: shrinkermd

The Mob should have it so good.

2 posted on 07/23/2008 5:11:34 AM PDT by em2vn
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To: em2vn
"The Mob should have it so good."

Politicians and bureaucrats ARE the Mob.

3 posted on 07/23/2008 5:50:12 AM PDT by Roccus (I love my country...the government is another story.)
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To: shrinkermd

Franklin Raines SHOULD be in PRISON....along with Jamie Gorelick.

4 posted on 07/23/2008 6:03:35 AM PDT by Ann Archy (Abortion.....The Human Sacrifice to the god of Convenience.)
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To: Roccus

There is an unknowably large but sizable faction in Wall Street with ties to various factions within “organized crime”. The The Colombo and Gambino groups were working closely with the Russian mobs as early as the 1980’s according to court documents. The Russian mobs make the old Mafia look like a Sunday school class but prefer to work behind the scenes. They are cold as ice.

Some of this stuff is tied to Eliot Spitzer, ex-New York governor, who had a reputation amongst high level law enforcement as a fellow who would punish Wall Street entities for not cooperating with Spitzer’s Mob associates. This is why the FBI had been investigating Spitzer.

How far the rot spreads within government is unknowable. Certainly South Chicago pols are uniformly infected, very probably including Obama.

5 posted on 07/24/2008 11:03:04 AM PDT by Iris7 ("Do not live lies!" ...Aleksandr Solzhenitsyn)
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To: shrinkermd

“, Fannie was able to pay no fewer than 21 of its executives more than $1 million in 2002, and in 2003 Mr. Raines pocketed more than $20 million.”

Fannie Mae spared no expense financing their left wing anti American favorite charities either.

Like millions every year to Jackson’s Rainbow coalition, MALDEF, LaRaza, etc.

MALDEF SILVER PARTNERS: $10,000 - ­ $49,000

2003 - Fannie Mae Foundation

Contributors to The National Council of The Race

Fannie Mae Foundation

6 posted on 07/24/2008 11:12:02 AM PDT by AuntB ( “During times of universal deceit, telling the truth becomes a revolutionary act.” - George Orwel)
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