Serving Two Masters, Yet Out of Control
Fannie Mae and Freddie Mac

  • Title:

    Serving Two Masters, Yet Out of Control
  • Edited By:

    Peter J. Wallison
  • Format:

    Paperback
  • Paperback Price:

    20.00
  • Paperback ISBN:

    0-8447-4166-3
  • Paperback Dimensions:

    6'' x 8.75''
  • 187 Paperback pages
  • Buy the Book

Click here to view the full book as an Adobe PDF.

Because two disparate, almost diametrically opposite clients demand loyalty from Fannie Mae and Freddie Mac, these government-sponsored entities must fulfill two ultimately irreconcilable roles. As publicly owned corporations, they must maximize profitability for their shareholders; yet, as quasi-government agencies, they should use their huge, implicit government subsidies in support of their public missions. In reality, they split the difference as they transfer a large portion of their subsidy to their shareholders. At the same time, Congress does not routinely scrutinize Fannie and Freddie, despite their enormous size and importance. The two are clearly too large and powerful for the small agency charged by Congress as their watchdog. Thus, while attempting to serve two masters, Fannie and Freddie are literally out of control.

Would privatization solve the dilemma of the dual public and private form? If not, what other options exist? In eleven essays, public figures, economists, and government officials probe the favored positions that have allowed the two agencies to grow to unprecedented size, realize extraordinary profitability, and achieve unparalleled influence over the political process.

Contributors are Jonathan Brown, Essential Information; Charles W. Calomiris, Columbia University and AEI; Richard Scott Carnell, Fordham University; Ron Feldman, Federal Reserve Bank of Minneapolis; Ralph Nader, Mark Overend, SLM Holding Corporation; Robert S. Seiler Jr., Office of Federal Housing Enterprise Oversight; Thomas H. Stanton, attorney; Robert Van Order, Freddie Mac; and John C. Weicher, Hudson Institute. Peter J. Wallison, volume editor, is an AEI resident fellow.

View by chapter:

"Introduction," by Peter J. Wallison

"Estimating the Value and Allocation of Federal Subsidies," by Robert S. Seiler Jr.

"The Economics of Fannie Mae and Freddie Mac," by Robert Van Order

"Federal Deposit Insurance and Federal Sponsorship of Fannie Mae and Freddie Mac: The Structure of Subsidy," by Richard Scott Carnell

"An Economist's Case for GSE Reform," by Charles W. Calomiris

"How Fannie and Freddie Influence the Political Process," by Ralph Nader

"Setting GSE Policy through Charters, Laws, and Regulations," by John C. Weicher

"Improving Control over Fannie Mae and Freddie Mac," by Ron Feldman

"Reform of GSE Housing Goals," by Jonathan Brown

"The Privatization of Sallie Mae," by Mark Overend

"An Alternative Approach to GSE Reform through National Mortgage Associations," by Thomas H. Stanton

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About the Author

 

Peter J.
Wallison

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