GSE Reform

Research

House of Cards: Reforming America's Housing Finance System Dwight M. Jaffee, Arnold Kling, Peter Wallison, Lawrence J. White, Michael Lea, Anthony B. Sanders, Edward Glaeser \| Feb 29, 2012 This research compendium presents a variety of articles that discuss the problems with housing finance in the U.S. and presents alternative reforms to the current GSE model.	Five Proposals for a New Housing Finance System in the United States Dwight M. Jaffee, Lawrence J. White, Peter Wallison, Arnold Kling, Anthony B. Sanders, Michael Lea \| Mar 2011 Some commentators suggest that a private market for U.S. mortgages is no longer possible. Others argue that heavily subsidized government programs have crowded out private providers, making actual competition impossible. The five papers presented here look beyond the housing crisis to present various proposals for the long-term reform of government-sponsored enterprises (GSEs) and the U.S. mortgage market.
Gambling with Other People's Money Russell Roberts \| Apr 28, 2010 “If you don’t know who the sucker is at the table, it’s probably you,” runs an old poker saying. At the poker table of the current financial crisis, “We are the suckers,” opines Professor Russ Roberts as he makes the case that public-policy decisions have perverted the incentives that naturally create stability in financial markets and the market for housing.	Not What They Had in Mind: A History of Policies that Produced the Financial Crisis of 2008 Arnold Kling \| Sep 2009 This paper looks at the roots of the current crisis through an analytical framework of bad bets, excessive leverage, domino effects, and 21st-century bank runs. It shows that broad policy areas—including housing policy, capital regulations for banks, industry structure and competition, autonomous financial innovation, and monetary policy—affected elements of this framework to varying, but important degrees.
Neither Fish Nor Fowl: An Overview of the Big-Three Government-Sponsored Enterprises in the U.S. Housing Finance Markets \| Nov 2001 Former Mercatus Scholars Jay Cochran and Catherine England examine the three big Government-Sponsored Enterprises (GSE) in the United States: Fannie Mae (the Federal National Mortgage Association) and Freddie Mac (the Federal Home Loan Mortgage Corporation), and the Federal Home Loan Bank System.

Testimony & Comments

Transparency, Transition, and Taxpayer Protection: More Steps to End the GSE Bailout Anthony B. Sanders \| May 25, 2011 Anthony Sanders testified before the House Committee on Financial Services about steps to end the GSE bailout.	Credit Default Swaps on Government Debt: Potential Implications of the Greek Debt Crisis Anthony B. Sanders \| Apr 29, 2010 In his testimony, Professor Sanders explores the question whether Credit Default Swaps caused the Greek debt…
Housing Finance Reform Anthony B. Sanders \| Mar 30, 2010 Before the House Financial Services Committee, Mercatus Center's Financial Markets Working Group member Anthony Sanders highlights that the combined debt load for Fannie Mae, Freddie Mac, and the…	The Present Condition and Future Status of Fannie Mae and Freddie Mac Lawrence J. White \| Jun 03, 2009 Lawrence J. White argues in congressional testimony that Fannie Mae and Freddie Mac should be privatized and sever all ties to the federal government.
Collapse of Fannie Mae and Freddie Mac Arnold Kling \| Dec 09, 2008 Arnold Kling, a member of Mercatus's Financial Markets Working Group, testified on the role of Fannie Mae and Freddie Mac in the current financial crisis before the House Committee on Oversight and Government Reform on December 9, 2008. In his testimony, Dr. Kling offered a series of lessons from the collapse of the secondary mortgage market.

Expert Commentary

Leaving Fannie Mae, Freddie Mac As Is Risks Another Housing Bubble By Anthony B. Sanders \| May 15, 2012 While a privatized housing finance system would be ideal, it is likely that we need a government medallion (or backstop) for mortgage lenders. The idea would be to scale down the guarantee over time and let the private market return. A cooperative structure for a national securitization operation would eliminate the "cookie jar" nature of Fannie Mae and Freddie Mac.	The Real Cost of the 2008 Bailouts By Hester Peirce \| Mar 14, 2012 Regulators, faced with another crisis in the future, will look to this precedent of preferential treatment for some and not others set by Secretary Geithner and his colleagues in 2008. When businesses come asking for money, government officials will find it hard to say no.
Geithner’s Own Forgetfulness By Hester Peirce \| Mar 02, 2012 Secretary Geithner writes in today’s Wall Street Journal to remind us of the panic of 2008, because he fears that those of us who have the audacity to criticize Dodd-Frank might have forgotten how bad it was. This is the latest attempt by the Treasury Department to silence its critics during the implementation of Dodd-Frank.	The Unacceptably Reserved Federal Reserve By Hester Peirce \| Feb 21, 2012 If the Fed insists on playing a big role in the regulatory game, then it must play by the normal rules of transparency.
Refi Plans Barely Appear in the Budget By Anthony B. Sanders \| Feb 13, 2012 Anthony Sanders expresses concern over the president's FY2013 budget, particularly in relation to housing policy.	Congress Increasing FHA’s Footprint in Housing Market By Anthony B. Sanders \| Nov 16, 2011

More Expert Commentary

Videos

Destination Unknown: The Future of GSEs In America

Lawrence J. White, Anthony B. Sanders, Arnold Kling, Hester Peirce | May 02, 2012

Anthony Sanders Evaluates a Mortgage Fee Proposal on Fox Business

Anthony B. Sanders | December 12, 2011

Podcasts

Destination Unknown: The Future of GSEs In America

Anthony B. Sanders, Lawrence J. White, Jason J. Fichtner, Hester Peirce | May 02, 2012

Mercatus Center financial services experts Anthony Sanders, Arnold Kling, and Lawrence J. White discuss the future of GSEs, Fannie Mae and Freddie Mac, and the government's role in the U.S. housing market.

Download the MP3

More Podcasts

Recent Events

Destination Unknown: The Future of GSEs In America

Please join Mercatus Center financial services experts Anthony Sanders, Arnold Kling, and Larry J. White in discussing the future of GSEs, Fannie Mae and Freddie Mac, and the government's role in the U.S. housing market.

House of Cards: Reforming America's Housing Finance System Dwight M. Jaffee, Arnold Kling, Peter Wallison, Lawrence J. White, Michael Lea, Anthony B. Sanders, Edward Glaeser \| Feb 29, 2012 This research compendium presents a variety of articles that discuss the problems with housing finance in the U.S. and presents alternative reforms to the current GSE model.	Five Proposals for a New Housing Finance System in the United States Dwight M. Jaffee, Lawrence J. White, Peter Wallison, Arnold Kling, Anthony B. Sanders, Michael Lea \| Mar 2011 Some commentators suggest that a private market for U.S. mortgages is no longer possible. Others argue that heavily subsidized government programs have crowded out private providers, making actual competition impossible. The five papers presented here look beyond the housing crisis to present various proposals for the long-term reform of government-sponsored enterprises (GSEs) and the U.S. mortgage market.
Gambling with Other People's Money Russell Roberts \| Apr 28, 2010 “If you don’t know who the sucker is at the table, it’s probably you,” runs an old poker saying. At the poker table of the current financial crisis, “We are the suckers,” opines Professor Russ Roberts as he makes the case that public-policy decisions have perverted the incentives that naturally create stability in financial markets and the market for housing.	Not What They Had in Mind: A History of Policies that Produced the Financial Crisis of 2008 Arnold Kling \| Sep 2009 This paper looks at the roots of the current crisis through an analytical framework of bad bets, excessive leverage, domino effects, and 21st-century bank runs. It shows that broad policy areas—including housing policy, capital regulations for banks, industry structure and competition, autonomous financial innovation, and monetary policy—affected elements of this framework to varying, but important degrees.
Neither Fish Nor Fowl: An Overview of the Big-Three Government-Sponsored Enterprises in the U.S. Housing Finance Markets \| Nov 2001 Former Mercatus Scholars Jay Cochran and Catherine England examine the three big Government-Sponsored Enterprises (GSE) in the United States: Fannie Mae (the Federal National Mortgage Association) and Freddie Mac (the Federal Home Loan Mortgage Corporation), and the Federal Home Loan Bank System.

Transparency, Transition, and Taxpayer Protection: More Steps to End the GSE Bailout Anthony B. Sanders \| May 25, 2011 Anthony Sanders testified before the House Committee on Financial Services about steps to end the GSE bailout.	Credit Default Swaps on Government Debt: Potential Implications of the Greek Debt Crisis Anthony B. Sanders \| Apr 29, 2010 In his testimony, Professor Sanders explores the question whether Credit Default Swaps caused the Greek debt…
Housing Finance Reform Anthony B. Sanders \| Mar 30, 2010 Before the House Financial Services Committee, Mercatus Center's Financial Markets Working Group member Anthony Sanders highlights that the combined debt load for Fannie Mae, Freddie Mac, and the…	The Present Condition and Future Status of Fannie Mae and Freddie Mac Lawrence J. White \| Jun 03, 2009 Lawrence J. White argues in congressional testimony that Fannie Mae and Freddie Mac should be privatized and sever all ties to the federal government.
Collapse of Fannie Mae and Freddie Mac Arnold Kling \| Dec 09, 2008 Arnold Kling, a member of Mercatus's Financial Markets Working Group, testified on the role of Fannie Mae and Freddie Mac in the current financial crisis before the House Committee on Oversight and Government Reform on December 9, 2008. In his testimony, Dr. Kling offered a series of lessons from the collapse of the secondary mortgage market.

Leaving Fannie Mae, Freddie Mac As Is Risks Another Housing Bubble By Anthony B. Sanders \| May 15, 2012 While a privatized housing finance system would be ideal, it is likely that we need a government medallion (or backstop) for mortgage lenders. The idea would be to scale down the guarantee over time and let the private market return. A cooperative structure for a national securitization operation would eliminate the "cookie jar" nature of Fannie Mae and Freddie Mac.	The Real Cost of the 2008 Bailouts By Hester Peirce \| Mar 14, 2012 Regulators, faced with another crisis in the future, will look to this precedent of preferential treatment for some and not others set by Secretary Geithner and his colleagues in 2008. When businesses come asking for money, government officials will find it hard to say no.
Geithner’s Own Forgetfulness By Hester Peirce \| Mar 02, 2012 Secretary Geithner writes in today’s Wall Street Journal to remind us of the panic of 2008, because he fears that those of us who have the audacity to criticize Dodd-Frank might have forgotten how bad it was. This is the latest attempt by the Treasury Department to silence its critics during the implementation of Dodd-Frank.	The Unacceptably Reserved Federal Reserve By Hester Peirce \| Feb 21, 2012 If the Fed insists on playing a big role in the regulatory game, then it must play by the normal rules of transparency.
Refi Plans Barely Appear in the Budget By Anthony B. Sanders \| Feb 13, 2012 Anthony Sanders expresses concern over the president's FY2013 budget, particularly in relation to housing policy.	Congress Increasing FHA’s Footprint in Housing Market By Anthony B. Sanders \| Nov 16, 2011