In his State of the Union address, President Obama delivered a positive message about our nation that we can all agree on,but fell short in providing the specifics on how we will maintain our greatness. With the economy still feeling the weight of a recession, the cause for the collapse of the financial system still has not been adequately addressed.
As I have said before, Freddie Mac and Fannie Mae were significant players in our financial crisis. While their risky loans were a major factor in the collapse of the housing market, they have yet to undergo serious reform. The private sector continues to correct its business practices while Freddie and Fannie continue to be protected by the Administration – both financially and legally. They have yet to face the painful accountability that the rest of their industry faced in the aftermath of the crisis.
This week it was revealed that you, the American taxpayer, are footing the bill for millions of dollars in the legal fees to protect the former executives of Freddie and Fannie. In total, taxpayers have covered $160 million in legal fees for top executives who have since left the firms.
Freddie and Fannie have taken more than $150 billion in direct taxpayer aid since 2008. Given our $14 trillion national debt, this taxpayer dependency is not sustainable. If we want to fulfill our optimistic vision for our nation that the President outlined on Tuesday, we must end federally financed relationships such as Fannie Mae and Freddie Mac.