Making a Fannie and Freddie we could live with
The Hill - April 27, 2015 - April 27, 2015
The Hill, By Mark A. Calabria and Alex J. Pollock
Fannie Mae and Freddie Mac’s collapse into government conservatorship was a long six and a half years ago. In spite of endless discussions of reform, they remain in conservatorship limbo, where they are run by their regulator as wards of the state, with de minimis capital. Nobody wants the old Fannie and Freddie back; nobody wants them to stay on indefinitely in conservatorship.
What is required are practical steps forward, rather than designing the ideal but politically unachievable solution. We offer Congress the following suggestion as something that can be done now: simply take away all Fannie and Freddie’s special privileges. They could be allowed out of conservatorship when all of the following actions have been taken:
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