This is old news in some respect but it boggles my mind how the liberal left are too stupid to recoginze the bs.
Also, as many forget, there was nearly an equal Dem/Rep control of senate since 2001 and the house of representatives was ruled by the dems from 07-2011. At the bear minimum, both parties had opportunity to fix or screw things up.
Barney Frank and other democrats, at a congressional hearing back in 07-08, bashed Bush saying conservatives were creating false alarms and the housing market wasn't going to crash.
Well, guess what libs, it did.
Not only that, FHA now runs Freddie Mac /Fanny Mae and paid out 95 MILLION in bonuses. 5.5 million each to two guys, with a projected pay target of 6 million in 2011.
This is a US gov. run subsidization program so it is no wonder that liberal touchy feel good hippie types don't make an issue of it. Pay off 'the man' as long as it is a 'take care of the less fortunate' program.
Media liberals bitched about AIG but not a squeek about this.
As I am in the process of buying a house, it gets my dander up that a neighbor has a 425k home and she only has to finance half that due to a low income assistance program. The house in now in foreclosure, like nearly 80% of the homes that were financed under similar programs. What gets me further is with these down payment, finance assistance programs, etc. the interest rate, is lower than a standard 30 or 15 year fixed. So I have to keep my credit up to par, earn a good living to get a rate that is higher than someone who couldn't afford their dream home in the 1st place, but they still get to? Our neighbor admittedly does not work, has 6 kids, her cars are all less than 3-4 years old, including the cars for her older kids and the view into the house through the large a$$ bay window, her interior is decked out pretty nice as well.
My bs rant.
WASHINGTON (CNNMoney) -- Executives at Fannie Mae and Freddie Mac need big pay packages to protect taxpayers from losing more of the billions spent to rescue the mortgage finance companies, according to the head of the agency that sets pay at the beleaguered firms.
"Taxpayers. . . would not be better off if we provoke a rapid turnover of senior management by further slashing compensation," said Edward DeMarco, acting director of the Federal Housing Finance Agency, in testimony Tuesday before the Senate Banking Committee. He said pay cuts and senior management turn-over could "increase the risk of higher losses," he added.
The net cost of the taxpayer bailout of Fannie Mae and Freddie Mac is about $124 billion -- dwarfing bailouts to any other financial firm. Those firms bought up many of the bad and underwater mortgages from Wall Street banks -- such as Bank of America (BAC, Fortune 500), Citigroup (C, Fortune 500) and Goldman Sachs (GS, Fortune 500) -- during the height of the financial crisis.
DeMarco added that executives who work at Fannie Mae and Freddie Mac, regardless of how well they perform their duties, "risk tarnish to their reputations" just by working at the firms.
Fannie Mae and Freddie Mac received the biggest federal bailout of the financial crisis, topping $124 billion. And $95 million of those tax dollars went to lucrative pay packages for top executives, filings show.
Reports on salary were made public by the companies earlier this year, but received little attention until a recent report by Politico, the political news website, which highlighted about $12.8 million in bonuses the executives received last year. Lawmakers in both parties are enraged.
0:00 / 2:30 Outrage over Fannie and Freddie bonuses
While DeMarco was grilled in the Senate, the House Financial Services Committee passed a bill to suspend executive pay packages at Fannie Mae and Freddie Mac with an overwhelmingly bipartisan vote of 52-4.
"Never again should Americans be forced to send their hard-earned tax dollars to be wasted on multi-million dollar pay packages for Fannie and Freddie executives," said that committee's chief Rep. Spencer Bachus, an Alabama Republican.
The Federal Housing Finance Agency set executive pay at the firms in consultation with the Treasury Department. The agency talked to the executive compensation czar for bailed-out banks, Ken Feinberg, when setting pay.
DeMarco stressed that good pay is needed to keep and retain executives who can manage tens of thousands of employees and some $5 trillion worth of mortgage assets.
But lawmakers said they were unmoved by such arguments.
"There's a big difference" between private financial firms and Fannie Mae and Freddie Mac, said Sen. Jon Tester, a Montana Democrat, criticizing the argument that mortgage finance firms compete with the likes of Wells Fargo (WFC, Fortune 500) for executives. "These companies (banks) are profitable and solvent, and they don't rely on taxpayer funds to keep their lights on," he said.
DeMarco said that executives didn't get bonuses or incentives in 2008, when the federal government took over. But senior management has since turned over since then. He also said that pay had been cut by 40% in the years that the federal government had taken over the firms.
Fannie CEO Michael Williams and Freddie CEO Charles Halderman each received about $5.5 million in pay for last year, and they could receive more when their final deferred compensation for 2010 is set. All the executives receive a significant portion of their pay in the year or years after they earn it.
The CEOs' pay targets for 2011 are about $6 million a piece -- though Halderman might not get much of that money since he's announced plans to leave Freddie sometime in 2012. He must still be at the company in order to receive the deferred compensation. His base pay for 2011 is $900,000, with most of the rest of his compensation coming in deferred payments.