MSNBC.com picks up the story this morning about Fannie Mae’s new management shakeup. Straining under the pressure of the Subprime mess, Fannie has opted to shake up management in an effort to instill confidence of the private sector that they’re going to weather the storm.
Well, ain’t that rich? Nowhere in the story is there any description of why Fannie and Freddie are so encumbered. Rather, the discussion leaves the impression that yet another government-backed institution is crumbling in the midst of controversy and crisis. Nowhere is there a discussion of the fact that a decade and a half of irresponsible lending and reckless profit motive in the private sector cause the Subprime/ARM Mortgage crisis. Not a word about the fact that – at the behest of the anti-government government of George Bush – the partial public agencies of Fannie and Freddie took on the bad debts of the private sector in an effort to keep people in their homes and the market from crashing our entire economy.
There is, however, copious tsk-tsking and doom-saying on the part of private sector analysts, many of whom probably cheered on the reckless spending that got us into this mess. How nice. It’s like setting your house on fire while juggling torches. . . and then bitching about the fire department’s response time.
