A lot has been made over the collapse of Fannie Mae.  For a while, peeps kept insisting it was apparently a short term blip and that a huge infusion of cash would apparently make everything good.    Other peeps, like me and a few others, have argued that unless they change the rules and allow Fannie Mae to operate on traditional lending practices, it will never survive.  Well, that was nearly five years ago when the alarms started going up:

“If Congress does not act,” McCain said in 2005, “American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system and the economy as a whole.”

That started a path of two very divergent political careers that met in the 2008 Presidential Election.  You had John McCain who said Fannie Mae was broken, and Barack Obama who said John McCain basically had no right to criticize Fannie Mae.  In 2005, it became obvious Fannie Mae was in trouble as federal regulators basically took over Fannie Mae under accusations they were cooking the books to keep it solvent.  Daniel Mudd took over in 2005.  This is what he had to say during his introduction:

Take a real close look at who’s in the back row. Now, according to Mudd, he answered to, get this, the Congressional Black Caucus. Subsequently, from that point forward, Fannie Mae would not only pay Mudd $80 MILLION to steer it from federal oversight into conservatorship, but they donated lavishly to political candidates. The top recipients of the 2005 cycle included:

Kerry, John (D-MA) Senate $30,000
Daschle, Tom (D-SD) Senate $16,499
Bush, George W (R) Pres $12,745
Carper, Tom (D-DE) Senate $4,889
Dorgan, Byron L (D-ND) Senate $4,500
Frank, Barney (D-MA) House $4,250

Barney Frank would become Fannie Mae’s staunchest defender as things got messy. In the 2006 funding cycle, their focus shifted:

Allen, George (R-VA) Senate $16,450
Davis, Tom (R-VA) House $14,200
DeWine, Mike (R-OH) Senate $12,450
Burns, Conrad (R-MT) Senate $12,000
Johnson, Tim (D-SD) Senate $11,000
Pryce, Deborah (R-OH) House $10,500
Bachus, Spencer (R-AL) House $10,000
Blunt, Roy (R-MO) House $10,000
Stabenow, Debbie (D-MI) Senate $10,000

Then, in 2008, after regulators had seized Fannie Mae, and Fannie Mae was getting BILLIONS in TARP funds, their political donations, yes you heard that right, shifted once again:

Obama, Barack (D-IL) Senate $41,900
Dodd, Chris (D-CT) Senate $25,500
Clinton, Hillary (D-NY) Senate $19,100
Bachus, Spencer (R-AL) House $11,500
Bean, Melissa (D-IL) House $11,249
McCain, John (R-AZ) Senate $10,250
Alexander, Lamar (R-TN) Senate $9,000
Bennett, Robert F (R-UT) Senate $8,999
Davis, Tom (R-VA) House $8,999
Boehner, John (R-OH) House $8,000
Pelosi, Nancy (D-CA) House $7,500
Reid, Harry (D-NV) Senate $7,500

As the financial crisis moved from the quasi-governmental sector into the private sector, the focus of the Obama administration jumped all over the private sector.  Talk immediately focused on greedy CEO’s makign too much money, banks making bad loans, etc. etc. etc.  According to Obama, it’s all bad in the private sector.  Citibank, Wells Fargo, all bad.  But, no one was saying a word about the bank that was donating to Obama.  Fannie Mae suddenly got swept under the rug.

Well, Obama’s poster child of how banks should be managed is back in the news:

Fannie Mae seeks $19 billion aid; uncertain about long-term financial sustainability 

According to Fannie Mae’s own people, it may NEVER be financially viable again.  In other words, it will be a permanent liability to the taxpayors.  In bigger terms, it will be what they envisioned in 1977, with the Community Reinvestment Act.  An entitlement program to help “certain” sectors of the US populatuion buy homes they otherwise could not afford with the tax money of those that can.  And, according to the previous director of Fannie Mae, that would be whoever the Congressional Black Caucus decides.

And, I doubt it will change any time soon.  Even though Fannie Mae is forecast to lose BILLIONS every year for the foreseeable future, they are STILL donating to political candidates:

Putnam, Adam H (R-FL) $10,000
Pelosi, Nancy (D-CA) $10,000
Neugebauer, Randy (R-TX) $10,000
Miller, Gary (R-CA) $10,000
Enzi, Mike (R-WY) $10,000
Emanuel, Rahm (D-IL) $10,000
Cornyn, John (R-TX) $10,000
Collins, Susan M (R-ME) $10,000
Coleman, Norm (R-MN) $10,000
Chambliss, Saxby (R-GA) $10,000
Cantor, Eric (R-VA) $10,000
Brown, Sherrod (D-OH) $10,000
Boehner, John (R-OH) $10,000
Blunt, Roy (R-MO) $10,000
Bean, Melissa (D-IL) $10,000
Bachus, Spencer (R-AL) $10,000
Alexander, Lamar (R-TN) $10,000
Mahoney, Tim (D-FL) $9,500
Roberts, Pat (R-KS) $9,000
Klein, Ron (D-FL) $9,000
Clyburn, James E (D-SC) $9,000
Hoyer, Steny H (D-MD) $8,500
Biggert, Judy (R-IL) $8,500
Reid, Harry (D-NV) $8,000
Tiberi, Patrick J (R-OH) $7,500
Scott, David (D-GA) $7,500
Roskam, Peter (R-IL) $7,500
Reed, Jack (D-RI) $7,500
Murray, Patty (D-WA) $7,500
Kanjorski, Paul E (D-PA) $7,500
Davis, Geoff (R-KY) $7,500
Barrasso, John A (R-WY) $7,500
Marchant, Kenny Ewell (R-TX) $7,000
Gerlach, Jim (R-PA) $7,000
Crowley, Joseph (D-NY) $7,000
Lynch, Stephen F (D-MA) $6,500
Landrieu, Mary L (D-LA) $6,500
Wilson, Charlie (D-OH) $6,000
Van Hollen, Chris (D-MD) $6,000
Frank, Barney (D-MA) $6,000
Barrett, Gresham (R-SC) $6,000
Velazquez, Nydia M (D-NY) $5,500
Pryor, Mark (D-AR) $5,500
Meeks, Gregory W (D-NY) $5,500
Maloney, Carolyn B (D-NY) $5,500
LaTourette, Steven C (R-OH) $5,500
Brown-Waite, Ginny (R-FL) $5,500
Baca, Joe (D-CA) $5,500
Smith, Gordon H (R-OR) $5,000
Rockefeller, Jay (D-WV) $5,000
Risch, James E (R-ID) $5,000
Reynolds, Tom (R-NY) $5,000
Rangel, Charles B (D-NY) $5,000
Pryce, Deborah (R-OH) $5,000
Nunes, Devin Gerald (R-CA) $5,000
McHenry, Patrick (R-NC) $5,000
McCrery, Jim (R-LA) $5,000
Matheson, Jim (D-UT) $5,000
Marshall, Jim (D-GA) $5,000
Hill, Baron (D-IN) $5,000
Heller, Dean (R-NV) $5,000
Foster, Bill (D-IL) $5,000
English, Phil (R-PA) $5,000
Durbin, Dick (D-IL) $5,000
Domenici, Pete V (R-NM) $5,000
Dodd, Chris (D-CT) $5,000
Childers, Travis W (D-MS) $5,000
Casey, Bob (D-PA) $5,000
Capito, Shelley Moore (R-WV) $5,000
Bond, Christopher S (Kit) (R-MO) $5,000
Moore, Dennis (D-KS) $4,500
Cazayoux, Donald J (D-LA) $4,500
Baucus, Max (D-MT) $4,500
Spratt, John M Jr (D-SC) $4,000
Miller, Brad (D-NC) $4,000
Melancon, Charles J (D-LA) $4,000
McConnell, Mitch (R-KY) $4,000
Johnson, Tim (D-SD) $4,000
Hodes, Paul W (D-NH) $4,000
Dorgan, Byron L (D-ND) $4,000
Castle, Michael N (R-DE) $4,000
Carson, Andre (D-IN) $4,000
Wexler, Robert (D-FL) $3,500
Tester, Jon (D-MT) $3,500
Slaughter, Louise M (D-NY) $3,500
Larson, John B (D-CT) $3,500
Isakson, Johnny (R-GA) $3,500
Donnelly, Joe (D-IN) $3,500
Davis, Lincoln (D-TN) $3,500
Boren, Dan (D-OK) $3,500
Bennett, Robert F (R-UT) $3,500
Wynn, Albert R (D-MD) $3,000
Watt, Melvin L (D-NC) $3,000
Solis, Hilda L (D-CA) $3,000
Sherman, Brad (D-CA) $3,000
Renzi, Rick (R-AZ) $3,000
Murphy, Patrick J (D-PA) $3,000
Murphy, Chris (D-CT) $3,000
Moore, Gwen (D-WI) $3,000
Knollenberg, Joe (R-MI) $3,000
Jackson, Jesse Jr (D-IL) $3,000
Hinojosa, Ruben (D-TX) $3,000
Herseth Sandlin, Stephanie (D-SD) $3,000
Becerra, Xavier (D-CA) $3,000
Jones, Stephanie Tubbs (D-OH) $2,750
Udall, Mark (D-CO) $2,500
Sessions, Pete (R-TX) $2,500
Schultz, Debbie Wasserman (D-FL) $2,500
McCarthy, Carolyn (D-NY) $2,500
Lewis, John (D-GA) $2,500
Leahy, Patrick (D-VT) $2,500
Gillmor, Paul E (R-OH) $2,500
Fossella, Vito (R-NY) $2,500
Ellison, Keith (D-MN) $2,500
Dingell, John D (D-MI) $2,500
Crapo, Mike (R-ID) $2,500
Bunning, Jim (R-KY) $2,500
Sires, Albio (D-NJ) $2,000
Shays, Christopher (R-CT) $2,000
Serrano, Jose E (D-NY) $2,000
Schwartz, Allyson (D-PA) $2,000
Sanchez, Loretta (D-CA) $2,000
Roybal-Allard, Lucille (D-CA) $2,000
Rogers, Mike (R-MI) $2,000
Rodriguez, Ciro D (D-TX) $2,000
Pomeroy, Earl (D-ND) $2,000
Pastor, Ed (D-AZ) $2,000
Napolitano, Grace (D-CA) $2,000
McCotter, Thad (R-MI) $2,000
McCarthy, Kevin (R-CA) $2,000
Kilpatrick, Carolyn Cheeks (D-MI) $2,000
Kerry, John (D-MA) $2,000
Graves, Sam (R-MO) $2,000
Grassley, Chuck (R-IA) $2,000
Gonzalez, Charlie A (D-TX) $2,000
Feeney, Tom (R-FL) $2,000
Drake, Thelma (R-VA) $2,000
DeGette, Diana (D-CO) $2,000
Cleaver, Emanuel (D-MO) $2,000
Cardoza, Dennis (D-CA) $2,000
Boxer, Barbara (D-CA) $2,000
Berkley, Shelley (D-NV) $2,000
Arcuri, Michael (D-NY) $2,000
Ackerman, Gary (D-NY) $2,000
Ryan, Paul (R-WI) $1,500
Menendez, Robert (D-NJ) $1,500
Hooley, Darlene (D-OR) $1,500
Boyd, Allen (D-FL) $1,500
Wolf, Frank R (R-VA) $1,000
Whitfield, Ed (R-KY) $1,000
Webb, James (D-VA) $1,000
Waters, Maxine (D-CA) $1,000
Thune, John (R-SD) $1,000
Thompson, Bennie G (D-MS) $1,000
Tauscher, Ellen (D-CA) $1,000
Space, Zachary T (D-OH) $1,000
Smith, Adam (D-WA) $1,000
Sanchez, Linda (D-CA) $1,000
Salazar, John (D-CO) $1,000
Ross, Mike (D-AR) $1,000
Reyes, Silvestre (D-TX) $1,000
Pearce, Steve (R-NM) $1,000
Olver, John W (D-MA) $1,000
Nelson, Ben (D-NE) $1,000
Myrick, Sue (R-NC) $1,000
Mikulski, Barbara A (D-MD) $1,000
Michaud, Mike (D-ME) $1,000
McNerney, Jerry (D-CA) $1,000
Martinez, Mel (R-FL) $1,000
Levin, Carl (D-MI) $1,000
Lee, Barbara (D-CA) $1,000
Latham, Tom (R-IA) $1,000
Klobuchar, Amy (D-MN) $1,000
Keller, Ric (R-FL) $1,000
Grijalva, Raul M (D-AZ) $1,000
Green, Al (D-TX) $1,000
Gordon, Bart (D-TN) $1,000
Ellsworth, Brad (D-IN) $1,000
Davis, Tom (R-VA) $1,000
Davis, Artur (D-AL) $1,000
Cuellar, Henry (D-TX) $1,000
Corker, Bob (R-TN) $1,000
Cole, Tom (R-OK) $1,000
Clay, William L Jr (D-MO) $1,000
Carney, Chris (D-PA) $1,000
Carnahan, Russ (D-MO) $1,000
Capuano, Michael E (D-MA) $1,000
Butterfield, G K (D-NC) $1,000
Burr, Richard (R-NC) $1,000
Tiahrt, Todd (R-KS) $500
Ortiz, Solomon P (D-TX) $500
Baker, Richard (R-LA) $500
Harkin, Tom (D-IA) $400

And of course, those candidates are more than willing to take it for the most part.

Now, people with half a brain would pretty much figure out that if something they were doing that was supposed to make them money instead cost them a LOT of money, they’d quit doing it real fast.  People with just a little more of a brain would look at who WAS making money with it and do it the same way.  Then, there are community activists and socialists.

Expect to shell out another $19,000,000,000 real quick so Nancy, Harry, Barack, and the Congressional Black Caucus can feel safe in that Fannie Mae will continue supporting their causes.  And, given who’s running it, the Congressional Black Caucus, expect it to continue making bad loans to people who should never have gotten one in the first place and then trashing the private sector for doing what it is the Community Reinvestment Act forced them to do.  But, under no circumstances expect anything to be done about the 1977 Community Reinvestment Act.

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