Politician Reactions to Fannie-Freddie Rescue
From the AP:
Senate Majority Leader Harry Reid, D-Nev., said “Senate Democrats stand ready to work with the administration to quickly and effectively address the situation currently facing these institution.”
House GOP leader John Boehner, R-Ohio, and Republican Whip Roy Blunt, R-Mo., said they “stand ready to work with Secretary Paulson and congressional Democrats to take appropriate steps to ensure the soundness of our mortgage markets.”
And let’s not forget the Presidential campaigns:
Democratic presidential contender Barack Obama said the government’s main concern should be “to make sure that home ownership remains attainable and affordable for American families. Second, any measures should protect taxpayers and not bailout the shareholders and management of Fannie Mae and Freddie Mac.”
Republican rival John McCain believes the measures announced Sunday “are consistent with the goal of providing support for a path through the current duress toward steps that include regulatory reform, market discipline and mission focus,” said Douglas Holtz-Eakin, senior policy adviser.
Sen. Obama doesn’t go out on limb. On the first part of his statement there isn’t much of a choice. Fannie and Freddie are crucial to the mortgage and housing markets because Congress and Presidents let them get that way. There won’t be much of a mortgage market if the two firms go bankrupt. On the second part both Fannie’s and Freddie’s stocks have plummeted. Shareholders have taken a hit. As for management compensation it depends on what’s in their contracts. I hope a catastrophic situation was accounted for, but judging from Fannie’s past [via OpenMarket.org], I doubt it.
There’s nothing to add to Holtz-Eakin’s bland quote. He didn’t say much.
“US Spells Out Fannie-Freddie Backstop Plan”
