Reforming Fannie Mae and Freddie Mac
The financial crisis was caused by failed federal policies that strong-armed, incented, and cajoled financial institutions into loaning money to people to buy homes that they couldn’t afford to keep. At the epicenter of this were Fannie Mae and Freddie Mac. The most disturbing aspect of the Dodd-Frank permanent bailout bill was the fact that it did nothing to reform Fannie and Freddie. You can’t address systemic risk while ignoring these two GSEs.
Fannie and Freddie were not born of a competitive marketplace, but in a government laboratory. They were allowed to exploit their implicit government guarantee to take on enormous risks. These two entities expose the taxpayer to unlimited risk and will likely end up receiving the mother of all bailouts.
The American taxpayers want the bailouts to end. That’s why I introduced the GSE Bailout Elimination and Taxpayer Protection Act, to protect taxpayers from more GSE losses. My bill would privatize Fannie and Freddie over a 5 year transition period, gradually eliminating taxpayer subsidies in the secondary mortgage market. The legislation would begin implementing important reforms upon enactment, put a hard 2 year end date on conservatorship and eliminate the government charters after 5 years. My legislation is supported by Heritage Action, Freedom Works, National Taxpayers Union, and the Council for Citizens Against Government Waste.
- I am the only Member of Congress to have introduced comprehensive reform legislation for Fannie and Freddie since the start of the credit crisis, lauded in the media as “a concrete plan for fixing Fannie and Freddie.” (H.R. 1182, the GSE Bailout Elimination and Taxpayer Protection Act, (H.R. 4889 - 111th Congress), and H.R. 7094, the GSE Free Market Reform Act in the 110th Congress).
March 18, 2011 Hensarling Re-Introduces Legislation to End Taxpayer Funded Bailout of Fannie Mae and Freddie Mac
September 15, 2010 Hensarling Comments at House Financial Services Hearing On GSEs
June 8, 2010 Through YouCut American People Support Hensarling Proposal To End Fannie Mae and Freddie Mac Bailouts
August 17, 2010 The Washington Examiner - Hensarling and Garrett: Makes no sense to keep the 800-pound gorilla of housing waiting
August 15, 2010 The Washington Examiner: Memo to Obama: Hensarling already has Fannie/Freddie reform bill in Congress
May 11, 2010 The Washington Examiner: Rep. Jeb Hensarling: Senate Majority Leaves Taxpayers on the Hook for Fannie, Freddie
January 14, 2010 Republicans hit Geithner over Fannie Mae, Freddie Mac
December 9, 2009 House Delays Action on Financial Rules Amid Consumer Dispute
November 20, 2009 Why No One Expects a Strong Recovery
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