From the Right

Observing my upside down America

Are GSEs Constitutional? (Probably, but perhaps they shouldn’t be)

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I singled-out the paragraph below which comes from The Wall Street Journal online edition entitled “Fannie Mae’s Patron Saint” which talks about Barney Frank.

By early 2007, Mr. Frank was in charge of the House Financial Services Committee, arguing that he had long favored some kind of reform. “What blocked it [reform] last year,” Mr. Frank said then, “was the insistence of some economic conservative fundamentalists in the Bush Administration who, to be honest, don’t think there should be a Fannie Mae or a Freddie Mac.” What really blocked it was Mr. Frank’s insistence that any reform be watered down and not include any reduction in their MBS holdings.

The 30,000 foot question I have is this; Why is the U.S. government in the business of being in business, creating so called Government Sponsored Enterprises (GSE)? My untrained-wanna-be-Constitution-law-brain wants to call that activity “unconstitutional”, but hey, I’m just a stoo-pid U.S. tax payer.

Here’s my other concern; Throughout the evolution of the Republican’s and others’ efforts to bring oversight into the business practices and policies of Fannie Mae and Freddie Mac, the likes of Barney Frank and his ilk continually defended the GSEs. The glaring problem? They hold no expertise or qualifications as accountants or financial analysts to allow them to espouse binding opinions about the health of these GSEs.  In fact – in a court of law – their so-called “expert” opinions would not be admissible. Yet we allow their opinions to trump the wisdom and insight of others who do.

My country is upside-down.

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Written by Ben

October 3, 2008 at 6:35 pm

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