Skip to comments.Gov't starts talks about new mortgage system
Posted on 08/17/2010 2:34:56 AM PDT by markomalley
Talk of shrinking the government's involvement in the mortgage market is growing. Just don't expect action any time soon.
A conference Tuesday at the Treasury Department is the first of many steps toward restructuring the nearly $11 trillion mortgage market. So far, rescuing mortgage giants Fannie Mae and Freddie Mac has cost the government more than $148 billion. That number is expected to grow.
Treasury Secretary Timothy Geithner will address the conference but is not expected to offer an exit strategy Tuesday. The administration has said it won't offer its plan until next year.
Officials are pledging dramatic changes to the structure of Fannie and Freddie, which profited tremendously during good times but burdened taxpayers with losses when the housing market went bust.
"We will not support a return to the system where private gains are subsidized by taxpayer losses," Geithner said in remarks prepared for the conference.
With Republicans likely to pick up seats in Congress in November, however, the Obama administration will need support from both political parties for the changes it proposes.
Reflecting this reality, Geithner will say Tuesday that "the failures that produced the system we have today were bipartisan. The solution must be as well."
Executives and mortgage experts are prepared to tell Obama officials that that the government must stay in the business of backing U.S. mortgages even if Fannie and Freddie disappear someday.
(Excerpt) Read more at msnbc.msn.com ...
“We will not support a return to the system where private gains are subsidized by taxpayer losses,”
Well then, let’s get rid of the mortgage interest deduction and get rid of the property tax regime at the same time. Why treat land/housing differently than any other asset?
Until the Feds began taxing the $%ap out of everybody in the country, people bought and sold houses for hundreds of years without their involvement. Same thing with healthcare, How do you think we all got here?!!
I had many ancestors that lived through their 80’s and 90’s without either Social Security or Medicare!!!Imagine. Some of them even participated in King George III’s schooling.
Geithner will say Tuesday that “the failures that produced the system we have today were bipartisan. The solution must be as well.”
Therefore, Obama concludes, we must nationalize the banking system in a bipartisan manner.
The GOP tried to reign in Fanny and Freddy, while the Dims insisted that no additional regulation was needed (and, in fact, would be racist!) Yeah...that's "bipartisan"...
The restructuring o f$11 trillion of ANYTHING by the govmint should terrify everyone. To paraphrase PJ O'Rourke (image alert):
Car keys, family car, bottle of whiskey, teen-agers