Waters Statement on GSE Repayment of Taxpayer Funds
Today, Government Sponsored Enterprise (GSE) Fannie Mae announced it has earned a fourth quarter profit of $6.5 billion in 2013 and will repay $7.2 billion to the U.S. Department of the Treasury in March. The payment will mean the company has returned $121.1 billion back to the taxpayers –returning even more than the $116.1 billion it received after being taken over by the government in 2008. This comes following a similar announcement by Freddie Mac late last year.
Congresswoman Maxine Waters, Ranking Member of the House Financial Services Committee, released the following statement:
“I am pleased with today’s announcement that the GSEs will repay the taxpayer in full. In 2008, as the economy was reeling out of control, Democrats worked with a Republican Administration to staunch the bleeding by putting Fannie Mae and Freddie Mac into conservatorship. Doing so was controversial, but the action helped stabilize the housing market and provided Congress the opportunity to address the root causes of the subprime crisis.
The GSEs return to profitability is a welcome sign for our economy, housing market and for the American taxpayers.
The conservatorship of Fannie and Freddie has led to robust discussion about reform of the government-sponsored enterprises. Several proposals have already advanced this conversation.
Next week, I will be discussing a proposal with Democratic members of the Financial Services Committee to reform the GSEs, which takes into consideration the changes in the marketplace since the crisis. This proposal will preserve the affordable 30-year, fixed rate mortgage and provide an explicit government guarantee that is paid for by industry. The proposal will also end the perverse incentives created by Fannie Mae and Freddie Mac's ownership structure of private shareholders.
What it will not do is undercut our housing market, our middle class and our economic recovery, as the House Republican plan does. The PATH Act’s irresponsible plan jeopardizes the availability of understandable mortgages like the 30-year fixed rate, severely limits FHA-backed mortgages and significantly harms community banks and credit unions by favoring the mega-banks. It would also repeal the protections against predatory lending in the Dodd-Frank law, inviting unscrupulous subprime lenders back into the market.
I look forward to further discussion of these issues.”