Politico reports: “The Obama administration’s efforts to fix the housing crisis may have fallen well short of helping millions of distressed mortgage holders, but they have led to seven-figure paydays for some top executives at troubled mortgage giants Fannie Mae and Freddie Mac. … The Federal Housing Finance Agency, the government regulator for Fannie and Freddie, approved $12.79 million in bonus pay after 10 executives from the two government-sponsored corporations last year met modest performance targets tied to modifying mortgages in jeopardy of foreclosure.”
The Occupy Wall Street Wikipedia page says the protesters “are mainly protesting social and economic inequality, corporate greed, corruption and influence over government—particularly from the financial services sector—and lobbyists.”
If there are two entities that epitomize the intersection of financial services, greed, and influence over government, they are Fannie Mae and Freddie Mac. These two formerly government sponsored entities used their unspoken federal government guarantee to gain a monopoly on the mortgage securitization business. When some in Congress started asking questions about Fannie’s business model, Fannie set up one of the largest lobbying operations in the country, setting up home offices in the districts of key congressmen. They partnered with subprime borrowers like Countrywide Financial to inflate the housing bubble, and when it popped the taxpayer had to bail both of these entities out. And during the whole time, both Fannie and Freddie kept paying their top executives multi-million dollar bonuses.
If the Occupy movement has any real understanding of the financial crisis, and how certain actors in the financial sector used taxpayer bailouts to enrich themselves, then they should have been marching on Fannie and Freddie from day one.
House Government Reform and Oversight ranking member Elijah Cummings told Politico: “It is outrageous that senior executives at Fannie and Freddie are receiving multimillion-dollar compensation packages when they now rely on funding from U.S. taxpayers, many of whom face foreclosure or whose homes are underwater.”
If the Occupy movement does not march on Fannie and Freddie, then they will expose themselves as a total farce. If they do, I just might join them.
