Last year, Fannie and Freddie were quietly authorized by their regulator to reevaluate their CEOs' compensation packages. In a move that came as a surprise to no one, they proposed $3.4 million raises for each CEO. I quickly authored legislation that reversed the raises, and capped their pay. Multimillion dollar CEO salaries at taxpayer backed organizations are totally unacceptable.
And now it has been revealed that the projected cost to build-out Fannie Mae’s new headquarters space has risen 53.35% from $164.32/sf to $252.81/sf. Furthermore, the folks charged with oversight of the Fannie Mae headquarters project were unaware of the escalation in projected costs! The organization overseeing a huge chunk of the mortgage market can't get a simple construction project right.
This headquarters debacle is the perfect representation of Fannie and Freddie's model of "private gains and public losses." Eliminating them ensures a robust housing market and reduces the chances of another boom-bust-bailout cycle that hurt so many Californians in 2008.
If Fannie and Freddie were real human beings and the government controlled them to make credit available to banks in order to help the housing market and then the worlds economy slides down though no fault between the two. No fault meaning they did what the government required. Then the government through duress takes more control by instituting provisions that forecast perpetual slavery until inevitable self-destruction. Would anyone say that this scenario was fair or would it be comparable to the time in the nations history when slavery was legal?