Mortgage “reform”–if we allow it–could be “the beginning of the end”


“Only two short years after Wall Street’s fraud and gress brought down the world’s economy, a Beltway think tank is proposing to put taxpayers on the hook for mortgages written and administered by the same corporate miscreants. And that’s the Democratic proposal. The Republicans want to double down on a failed strategy of ‘privatizing’ government mortgage financing, while at the same time cutting back on regulation and oversight

“… If we don’t see stronger proposals then these in the coming months, this will be remembered as … the beginning of the end, the moment when the next wave of privatization began and the way was paved for a collapse that may be even grater than the one we’re
in today.”

MCM

Fannie’s Scandalized, Freddie’s Dead – And The Next Financial Meltdown May Have Already Started
By Richard (RJ) Eskow

Here’s an idea: Let’s give hundreds of billions of dollars in government-backed guarantees to private banks so they can make a fortune writing mortgages without any risk to themselves. Hey, what could go wrong?

The FCIC’s recent report illustrated an important lesson from the economic meltdown: Privatization, not big government, ruined Fannie Mae and Freddie Mac. Running a government program like a private corporation leads to the worst excesses of executive self-indulgence. Fannie and Freddie didn’t bring down the economy, as some have claimed, but they were destroyed by the same privatize-and-deregulate philosophy that led to the crisis.

Read more.

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