WHERE THEY STAND

“The Housing and Economic Recovery Act of 2008 will provide crucial support for the housing market and … also establishes a series of landmark reforms that will put U.S. housing and mortgage finance on solid footing for the long term. Chief among these is the establishment of a new regulatory framework for the federally chartered housing enterprises that are at the center of the mortgage market: Fannie Mae, Freddie Mac and the Federal Home Loan Banks.”

—- Daniel H. Mudd, president and chief executive officer, Fannie Mae

“Fannie and Freddie’s continued activity is central to the speed with which we emerge from this housing correction and remove the underlying financial-market and financial-institution uncertainty. The temporary liquidity and capital backstops included in this new [housing recovery] law are aimed at supporting the short- and longer-term stability of financial markets, not just these two enterprises.”

—- Treasury Secretary Henry Paulson, in a July 31 speech

“Congress and the president are congratulating themselves for bailing out Fannie and Freddie and imposing more regulatory control, with the excuse that they pose a threat to financial market stability. A better solution, however, is to make these and other government-sponsored enterprises play by the same rules as other businesses, and to end the distortions caused by federal subsidies.”

—- Daniel J. Mitchell, Senior Fellow, Cato Institute