For the good of all things American, Bush has decided not to veto the housing bill after it definitely passes the House and probably passes the Senate. That’s what all the Republicans are mad about this morning.
The bailout (or “handout,” as many Republicans are calling it) of Fannie Mae and Freddie Mac could cost the government as much as $25 billion. That’s not including the extra $4 billion for local governments buying foreclosed properties. That’s a heck of a lot of money, but the FMs pretty much hold our housing fate in their hands. Since they’re “government sponsored enterprises” and it’s implied that the government will help them out, none of this should really come as a shock to anyone.
Maybe that’s why the unhappy Republicans can’t get the votes they need to stop the bill.
Here’s more, from The Wall Street Journal:
- WASHINGTON — The White House said Wednesday that President George W. Bush has dropped his opposition to the housing package. House and Senate leaders have largely hammered out a compromise deal on a mammoth package that would permit the government to bolster Fannie Mae and Freddie Mac in an emergency, overhaul supervision of the housing-finance giants and allow the government to insure up to $300 billion in refinanced mortgages.[...]
- It was a dramatic split for Mr. Bush and congressional Republicans, many of whom are angrily opposed to the housing legislation, which they call a handout for irresponsible homeowners and unscrupulous lenders. At a closed-door meeting Wednesday morning, House Republicans denounced the plan, although it’s clear they don’t have enough votes to prevent it from becoming law.[...]
- The deal includes several compromises. It would allow Fannie Mae and Freddie Mac to purchase loans of as much as $625,000 in high-cost areas of the country, a lower number than many House Democrats wanted but higher than some Senate lawmakers originally envisioned. It would also give the new regulator for Fannie Mae and Freddie Mac more control over the compensation packages received by top executives at either housing-finance giant, an unusual mark of government control over a publicly traded company.
- Mr. Paulson said in a speech in New York Tuesday that the stability of Fannie Mae and Freddie Mac was key to erasing uncertainty in U.S. financial markets.
Read the rest of the story here.
