The United States Government.
Last week, James Lockhart, director of the Federal Housing Finance Agency, said “it’s hard for me to see that [Fannie Mae] will be able to repay all of that.” After all, “their book is so large.” According to the Washington Post, “Lockhart’s comments were a blunt acknowledgment that while the government has long said its bailout of the financial sector largely represents an investment that will be repaid, billions of dollars are likely to be lost.”
First of all, anybody who honestly believed Fannie Mae would pay the government back was not thinking straight. After all, Fannie Mae’s most profitable fiscal year since the year 2000 only yielded $7.905 billion. The government has loaned them $61.4 billion thus far — with more to come. At this rate, it would take nearly 8 years for Fannie Mae to repay the government back. This is the most conservative estimate possible: it assumes Fannie Mae would immediately return to their prior maximum profitability and that all profits would be forwarded to the government. The losses due to a decrease in the value of our currency are not considered.
In the end, a reoccuring theme has appeared once again: bailing out corporations at the expense of taxpayers. When will this nonsense end?Published in