Editorials Attacking Fannie Mae and Freddie Mac Are Seriously Misguided
Nothing is more important to our nation’s system of housing finance than ensuring the health of our secondary mortgage market institutions. That’s why it is so disturbing to see irresponsible attacks on the mission of Fannie Mae and Freddie Mac appearing in recent newspaper editorials.
While the revelation of Freddie Mac’s accounting problems raises legitimate concerns about determining whether reform measures may be required, that process is only now getting underway in congressional hearings. Editorial writers who are jumping the gun and questioning whether these institutions deserve the implicit backing of the federal government are doing the public an immense disservice. First, they are focusing attention away from the real issues at hand. And second, they are suggesting proposals that risk seriously damaging a financial system that has been enormously beneficial to providing decent, affordable housing to the American people.
Maybe these writers are too young to appreciate the progress that has been made through Fannie Mae and Freddie Mac because they don’t remember the days, about three decades ago, when the nation’s home buyers had to rely on passbook savings accounts for their mortgage money. That source of financing was unreliable, to say the least, and there were some painful times in the housing cycle when home financing was largely unavailable at any price.
Or maybe these writers don’t grasp a reality that is obvious to most people in this country: Homeownership and rental housing opportunity are the glue that binds healthy neighborhoods and the means for families to get ahead and strive for achieving the good things in life that are so abundant in America. We shouldn’t lose sight of the fact that Fannie Mae and Freddie Mac, in addition to their activities on behalf of home buying, also help bring financing to multifamily housing.