McCain: Fannie, Freddie Need Competition

Sen. John McCain, R-Ariz., and Rep. Jeb Hensarling, R-Tex., are addressing the crisis of mortgage agencies Fannie Mae and Freddie Mac with a bill to give them a free market orientation.

“The award for the biggest government bailout goes … to the financial behemoths known as Fannie and Freddie,” the two write in The Hill.

“To date, these loss-making government-sponsored enterprises have cost the American people more than $150 billion, with potentially tens of billions more yet to come.”

The problem is that the government subsidized affordable housing for decades. Fannie and Freddie created “a system in which they ultimately privatized their profits and socialized their losses,” the lawmakers explain.

“That is why we re-introduced the GSE [government-sponsored enterprise] Bailout Elimination and Taxpayer Protection Act — legislation that will immediately end the GSEs’ affordable housing mandate and begin a five-year transition process to return the mortgage market back to a competitive environment.”