Bearing Down

Legislators have debated for years on whether and how to increase government oversight of Fannie Mae and Freddie Mac.

Wednesday, April 6, 2005

1992: Congress passes legislation establishing a new agency, the Office of Federal Housing Enterprise Oversight, to regulate Fannie and Freddie.

March 2000: Treasury Undersecretary Gary Gensler endorses legislation that would take away Fannie's and Freddie's lines of credit from the U.S. Treasury and provide stricter oversight of the two mortgage giants.

May and July 2000: Federal Reserve Board Chairman Alan Greenspan questions whether subsidies given to Fannie and Freddie benefit customers in the long run. He calls for periodic reviews of the benefits.

October 2000: In response to a bill introduced by Rep. Richard H. Baker (R-La.), chairman of the House Financial Services subcommittee on capital markets, Fannie and Freddie agree to undertake six voluntary initiatives to ensure financial soundness.

May 2001: The Congressional Budget Office reports that federal subsidies for Fannie and Freddie have doubled to more than $10.5 billion a year since 1995 and that a third of the subsidies are retained for shareholders and employees instead of being passed on to home buyers.

September 2003: The Bush administration recommends creating a new agency to regulate Fannie and Freddie. Committee chairmen in both houses of Congress announce they will draft legislation based on the administration's proposal.

April 2004: The Senate Banking Committee approves legislation that would create a new agency to oversee Fannie and Freddie, but the Bush administration opposes the bill because it lets Congress override a decision by regulators to take over the mortgage giants in a financial failure. The bill stalls.

January: The 2004 legislation is reintroduced in the Senate.

Yesterday: Similar legislation is introduced in the House.

SOURCE: Staff Reports | The Washington Post

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