Failed Socialist Debacle Fannie Mae To Contribute $59.4 Billion Cash Dividend To US Treasury
Back in 2008, when it was the End of History (but really this time), the American mortgage giant Fannie Mae took $116.1 billion from the government (“you”) in exchange for a nice promise that they’d fuck us twice as hard if they didn’t get it. Some people didn’t like it!
But this was a time when the economy was bleeding jobs out of every orifice, the entire government was panic-spending hundreds of billions on any damn thing they could think of (except “you”), and the shade of Karl Marx just straight gave up and stopped trying to hide his uncomely tumescence (boner). So most people greeted the news something like this: “Oh good more calamity who fucking cares.” Today their apathy is validated because everything is fine again, Fannie's cutting a check for a few dozen bil to the Treasury, the bailout will soon be fully repaid, everybody involved is making money hand over fist, and you are still poor (if you're poor).
So that’s good news (for Fannie Mae), but your Wonkette would be remiss if we did not use this item as a thin excuse to talk about what’s really important here, and that is Why Does Everyone Seem To Hate Fannie Mae? Answer: Because they are dupes.
Background: Fannie Mae is a government-sponsored enterprise whose main job is to be a name conservative free-market types invoke as a way of signifying to each other that they Know Stuff About The Economy, in particular the many dastardly ways that America’s dread African pirate-king Barack Obama has labored to crush it utterly. Lesser-known, but arguably just as important, is the critical role Fannie Mae plays in making it possible for non-incorporated Americans to own their own shitty slice of benighted exurban hellscape.
How they do this is simple: After a bank decides to make a mortgage loan, Fannie Mae buys the loan from that bank. This is what actually makes it possible for middle-class people to afford homes — without Fannie, retail banks would have to hold the mortgages they’ve written on their books, so they’d be extremely vulnerable to relatively small, local shocks to the economy. Under these conditions, many banks would decide simply to avoid the mortgage market altogether, making it incredibly hard for middle-class people to get approved for a loan. So Fannie's role here is 100% good stuff; the problems in the housing market started when privately held companies got heavily into this business and decided there was money to be made by doing away with "lending standards" and letting Goldman Sachs slice up the resulting destined-to-fail loans, mash all the bits together, and sell the resulting shit sandwiches to everyone's pension funds.
This is getting incredibly boring, so leave your Newt Gingrich’s stupid old wrong talking points in the comments if you’re one of the shockingly large number of smart people who still believe Fannie and Freddie had anything to do with the housing bubble and crash, and your Wonkette will eviscerate them.