Warnings were given against the federal giants Fannie and Freddie before the 2008 meltdown. They were allowed to do dangerous things. Congress was warned that they were too large - too much risk in two "companies," acting dangerously and ultimately didn't have enough capital for their bets. Warned repeatedly. Then it all blew up and there were part of the giant mess.
But Congress didn't listen. Rep. Barnie Frank and Senator Chris Dodd ignored the warnings by Sec. of Treasury John Snow in 2003, Chairman of Council of Economic Advisers Greg Mankiw in 2003 and Ben Bernanke in 2005. And more…
Indeed, Rep. Maxine Water and Rep Gregory Meeks chewed Snow out for wasting their time:
I have sat through nearly a dozen hearings where, frankly, we were trying to fix something that wasn't broke. [sic] ...These GSEs have more than adequate capital for the business they are in: providing affordable housing. As I mentioned, we should not be making radical or fundamental change... If there is anything to fix or improve, it is the [regulators].
Rep. Gregory Meeks, Democrat of New York, agreed with Rep. Waters and rabidly stated,
...I have to go to another hearing, I will try to be just real quick... I am just pissed off at [the regulator] because if it wasn't for you I don't think that we would be here in the first place. ...we are faced with is maybe some individuals who wanted to do away with GSEs in the first place, you have given them an excuse to try to have this forum [to change the] mission of what the GSEs had, which they have done a tremendous job... There has been nothing that was indicated is wrong, you know, with Fannie Mae... The question that then presents is the competence that your agency has with reference to deciding and regulating these GSEs.
That's just one; there were many more warnings. But, hey, all those people worked for President Bush.
Aaron Rodriguez shows the timeline at Conservative Hispanic.
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