McCain 2006 Letter for Fannie Mae/Freddie Mac Regulation

Sen. John McCain’s 2006 demand for regulatory action on Fannie Mae and Freddie Mac could have prevented current financial crisis, as show in the letter shown in full text below.

McCain’s letter — signed by nineteen other senators — said that it was “…vitally important that Congress take the necessary steps to ensure that [Fannie Mae and Freddie Mac]…operate in a safe and sound manner.[and]..More importantly, Congress must ensure that the American taxpayer is protected in the event that either…should fail.”

Sen. Obama did not sign the letter, nor did any other Democrat.

The letter is on U. S. Senate stationary and dated May 5, 2006.

One part of the letter is in bold: [Full Letter Below]

With the fiscal challenges facing us today (deficits, entitlements, pensions and flood insurance), Congress must ask itself who would actually pay this debt if Fannie or Freddie could not?

Immediately following in the next paragraph is this;

Substantial testimony calling for improved regulation of GSEs (government sponsored enterprises) has been provided to the Senate by the Treasury, Federal Reserve, HUD, GAO, CBO and others.

For years Democrats have told us criticisms of Fannie and Freddie’s embrace of subprime mortgages made to people with bad or no credit history was “racist.”

Yet look at all the agencies and oversight groups who called attention years back to the reckless practices the two GSEs were engaged in. It wasn’t “racist” to call “wrong” on Fannie and Freddie’s high risk mortgage practices while giving huge “performance” bonuses to their top executives.

McCain Letter