Fannie Seized

Ooh, the Bush government just seized Fannie Mae and Freddie Mac, and I'm all a-twitter!

Quick partial telegraphic history of US Government involvement in the housing, rental, and mortgage business since the New Deal: Home Owners' Loan Corporation (HOLC) '33, Housing Acts '34, '37, Pinko Commy Federal National Mortgage Association '38 (Fannie Mae), Servicemen's Readjustment Act '44 (the GI "Bill of Rights"), Housing Acts '49, '54, '64, Housing and Urban Development Act '65, Demonstration Cities and Metropolitan Development Act '66, Housing and Urban Development Act '68 (created Ginny Mae), Emergency Home Finance Act '70, (created Freddie Mac), Housing and Urban Development Act '70, Home Mortgage Disclosure Act (HMDA) '75, Community Reinvestment Act '77, Homesteading and Neighborhood Restoration Act '95, Pinko Commy Republicans Seize Fannie Mae and Freddie Mac '08.

Really, it's a hoot when small government conservatives say one day that you have to let the market correct itself, and the next day send in the Marines.

General rule: If poor people are the only ones hurt by a market downturn, a government correction of the market is invariably "liberal", but if wealthy investors are feeling the crunch, it's a threat to our national security. Bolsheviks arise!

The truth is, deep down inside, George Bush is jealous of Hugo Chavez. Hugo Chavez gets to wear the cool red beret and the khakis all the time and blah-blah all day and no one can stop him. He gets to seize corporations any time he wants. Now, George is probably thinking, "Heh, heh, Daddy never seized a multi-billion-dollar secondary mortgage guarantor! And I just seized two of them suckers in one day! Next week maybe I'll seize BP and ExxonMobil, heh, heh, that'd show'm."

I just wish it went down like in the movies. Hundreds of guys dressed all in black with wicked guns rappel from hovering black helicopters into windows, race down corridors, shoot their way into board rooms, and march corporate executive weasels at gunpoint to waiting buses, which speed them to their new suites at the Concertina Hotel. Why is it never like that? Reality hates me. I'm sure George feels the same way. It's something I sense we have in common. That, and a sweet love of women's beach volleyball.



All of this wouldn't have been necessary if the government had never privatized these corporations to begin with. You don't have to seize what you already own. I blame Nixon.

At the outset the idea was to back up the mortgage industry with public funds, and nobody seriously believed it could happen without them. Then, as Republicans took control in the late 60s (Nixon!) during a relatively minor housing crisis (minor compared to now) they enforced the idea that what Fannie Mae needed was to be cut loose from the government and begin to get her money the Old Fashioned Way. To help her along she was introduced to her brand new wily half brother Freddie Mac, who would teach her how it's done through the magic of competition. (The same administration later brought us wage and price controls).

By seizing both of them, the Bush administration has restored the Fannie Mae piece of the New Deal: Your irony of the week.

Toward Further Confusion

1. How is it that conservatives and liberals so often resort to the same solutions to the same problems? Could it be that conservatives and liberals differ mainly on the nature of their excuses? Could it be Darwin was right, and it's all about whatever works, works? Or is there a God, Who wrote unto Moses (tablet missing, presumed broken) Thou Shalt Lend Private Funds Only?

2. In 1950, to prevent a national railroad strike from interfering with the Korean War effort, Truman ordered the Army to seize the country's railroads. The Army did so successfully with 46 officers, one enlisted man (a sergeant), and eight civilian clerks. Explain, drawing from your own experiences, or experiences of others you've read about, how so few men with weapons can do so much.