Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

A New American Reality: Government As Provider (Fannie/Freddie Rescue, Full-Blown Socialism)
International Herald Tribune ^

Posted on 07/13/2008 7:29:42 PM PDT by quesney

NEW YORK: In a country that holds itself up as a citadel of free enterprise, Washington has morphed from being the lender of last resort into effectively the only resort for home loans for millions of Americans engaged in the largest transactions of their lives.

Before, the government's more modest mission was to make more loans available at lower rates. Now it is to make sure the loans that matter most to middle class Americans are made at all.

The new reality is scorned by libertarians and conservatives, who fear intrusions by the state in the market, and by populists and progressives, who rue a society in which education and housing increasingly rest upon the government's willingness to finance it.

"If you're a socialist, you should be happy," said Michael Lind, a fellow at the New America Foundation, a research institute in Washington. "But you should really wonder whether you want people's ability to pay for housing and college dependent on the motives of people in Washington."

Why is this happening? Much of the private money that once surged into the mortgage industry has fled in a panicked horde, leaving most of the responsibility for financing American homes to the government-sponsored Fannie and Freddie.

(Excerpt) Read more at iht.com ...


TOPICS: Business/Economy; Culture/Society
KEYWORDS: bailout; fanniemae; freddiemac; socialism
Navigation: use the links below to view more comments.
first previous 1-2021-32 last
To: Freedom4US

Doesn’t the gov have a say in a certain number of board members / directors / etc., as part of the privatization? I seem to remember it that way, and that’s why I said what I said. Their hands are still in the kitty...


21 posted on 07/13/2008 8:16:21 PM PDT by cliniclinical (space for rent)
[ Post Reply | Private Reply | To 18 | View Replies]

To: marajade

“Don’t know much about Alexander Hamilton do ya?”

Completely different situation and objective: instead of leaving revolutionary war debt to the states, he wanted to help forge a national identity among 13 discordant colonies by having the federal government assume that debt, which should’ve been the federal government’s responsibility anyway. It was war debt, for goodness sake. I doubt that what’s taking shape today is what Hamilton had in mind.


22 posted on 07/13/2008 8:16:52 PM PDT by quesney
[ Post Reply | Private Reply | To 16 | View Replies]

To: quesney

This is clearly a bad development. However, given the state of things, there were no good choices.


23 posted on 07/13/2008 8:23:58 PM PDT by Clintonfatigued (If Islam conquers the world, the Earth will be at peace because the human race will be killed off.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: cliniclinical

You’re right - and on so many fronts.


24 posted on 07/13/2008 8:34:00 PM PDT by MonicaG (Help Wanted: Conservative leadership '08)
[ Post Reply | Private Reply | To 19 | View Replies]

To: quesney

Mortgage Welfare


25 posted on 07/13/2008 9:14:42 PM PDT by TheThinker (Capitalism is the natural result of a democratic government.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: billva
how this is going to negatively affect you?

If banks can't sell the mortgage quickly (to likes of FNM) then they won't be offering any such mortgages. A mortgage is a long term loan, and banks just don't have the capital to freeze it for 30 years.

As result, a common man can't get a mortgage. Houses will be bought for cash only, which eliminates new homeowners, and those who want a larger house (or in a more expensive market.) The average price of a typical home will drop somewhat, following the lack of buyers. This will result in "house as an investment" schemes being thrown out of the window, and most people will see their assets reduced. Those who still pay mortgages may be forced to send the jingle mail (lose the house) because the property is no longer worth owning and paying for.

26 posted on 07/13/2008 9:16:31 PM PDT by Greysard
[ Post Reply | Private Reply | To 13 | View Replies]

To: Dianna
Banks were pressured to make loans to prove they weren't racist

And in the process, driving down the value of all neighborhoods. Ain't the government grand?

27 posted on 07/13/2008 9:27:52 PM PDT by TheThinker (Capitalism is the natural result of a democratic government.)
[ Post Reply | Private Reply | To 14 | View Replies]

To: lincolnton
The corruption of wall street during the Bush years has unfortunately reached monumental proportions.

<craig_ferguson>I knooowww</craig_ferguson>. The whole reason people are defaulting on their home loans, causing this big mortgage crisis, is that Bush caused corruption on Wall Street! And only you can see through the smokescreen!


28 posted on 07/13/2008 9:29:37 PM PDT by Nick Danger (www.swiftvets.com)
[ Post Reply | Private Reply | To 12 | View Replies]

To: quesney

Hamilton didn’t just do it cause of the war debt. He truly believed we’d be a stronger country with a federalized banking system.


29 posted on 07/13/2008 9:58:36 PM PDT by marajade (Yes, I'm a SW freak!)
[ Post Reply | Private Reply | To 22 | View Replies]

To: quesney

Just wait.
The morning will not be pretty.


30 posted on 07/13/2008 10:10:51 PM PDT by redgolum ("God is dead" -- Nietzsche. "Nietzsche is dead" -- God.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: cliniclinical

Yeah, it’s a “GSE” or Government Supported Entity.


31 posted on 07/14/2008 3:31:39 AM PDT by Freedom4US
[ Post Reply | Private Reply | To 21 | View Replies]

To: Greysard
how this is going to negatively affect you?

If banks can't sell the mortgage quickly (to likes of FNM) then they won't be offering any such mortgages. A mortgage is a long term loan, and banks just don't have the capital to freeze it for 30 years.

As result, a common man can't get a mortgage. Houses will be bought for cash only, which eliminates new homeowners, and those who want a larger house (or in a more expensive market.) The average price of a typical home will drop somewhat, following the lack of buyers. This will result in "house as an investment" schemes being thrown out of the window, and most people will see their assets reduced. Those who still pay mortgages may be forced to send the jingle mail (lose the house) because the property is no longer worth owning and paying for.

I understand your point completely. My question to him was how his mortgage being owned by either Fannie Mae or Freddie Mac was going to affect his mortgage.

He answered none which of course is correct.

32 posted on 07/14/2008 6:28:00 AM PDT by billva
[ Post Reply | Private Reply | To 26 | View Replies]


Navigation: use the links below to view more comments.
first previous 1-2021-32 last

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson