Now Uncle Sam Is Ripping Off Fannie and Freddie

Next month Fannie Mae and Freddie Mac, the giant enterprises that own or guarantee roughly half of all new mortgages, will hand over $7.2 billion to the U.S. Treasury, paying back more than the entire amount of their bailout. The achievement, which once seemed unimaginable, should be good news for the companies' many private shareholders. Thanks to astonishingly duplicitous behavior by the federal government, they may never get another dime from their investment. The story begins in July 2008, when Congress passed the Housing and Economic Recovery Act (HERA), authorizing a new regulator, the Federal Housing Finance Agency, to take over Fannie and Freddie if necessary.

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