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Mark R. Warner
Unwinding Fannie and Freddie
Unwinding Fannie and Freddie

Fannie Mae and Freddie Mac, as it turns out, were a pleasant fiction. The quasi-government guarantors of mortgage loans seemed like a good deal for Americans during all the years when they helped guarantee the availability of affordable, long-term home loans without any apparent cost — and, at times, with great private gain for their shareholders. But their true cost became all too real when the government's implicit guarantee of Fannie and Freddie was made explicit during the housing crisis. The Bush administration, and the Obama administration after it, pumped $188 billion in borrowed taxpayer money into stabilizing Fannie and Freddie, lest they collapse altogether and turn...