Kevin G. Hall, McClatchy's economics reporter, got taken to task today reporting Sarah Palin gaffed in comments about Fannie Mae and Freddie Mac. So, it's being reported today that GOP VP candidate Sarah Palin has made her "first major gaffe." In fact, it was NOT a gaffe at all. Both McClatchy Newspapers and the Huffington Post got it wrong.
Sam Stein makes this erroneous report on the Huffington Post today:
Speaking before voters in Colorado Springs, the Republican vice presidential nominee claimed that lending giants Fannie Mae and Freddie Mac had "gotten too big and too expensive to the taxpayers." The companies, as McClatchy [Newspapers] reported, "aren't taxpayer funded but operate as private companies. The takeover may result in a taxpayer bailout during reorganization." [Source: Huff Post]
The McClatchy article referenced above IS WRONG. It was written by Kevin G. Hall, who apparently just took as a matter of faith the idea that Fannie Mae and Freddie Mac "aren't taxpayer funded." Hall is dead wrong.
But Mr. Stein was slick. He wrote, "Gov. Sarah Palin made her first potentially major gaffe..." Notice the word "potentially." Perhaps Mr. Stein, even as he wrote his piece, suspected that there might be more to the story than met his eye. It's too bad he didn't let his eye scan just a few more Google searches. He would have found the following, from Rob Alford at the History News Network:
The Federal National Mortgage Association, nicknamed Fannie Mae, and the Federal Home Mortgage Corporation, nicknamed Freddie Mac, have operated since 1968 as government sponsored enterprises (GSEs). This means that, although the two companies are privately owned and operated by shareholders, they are protected financially by the support of the Federal Government. [Source]
Let's translate that for Kevin G. Hall: "Protected financially by the support of the Federal Government" means that federal tax dollars -from taxpayers - support Fannie Mae and Freddie Mac. Hall got it half right when he wrote that they "operate as private companies," but he missed the little details about (a) being protected financially by the US Government and (b) operating for 40 years as government sponsored enterprises. So, as to Sarah Palin's supposed "gaffe," we've just learned that it really was NOT a gaffe at all.
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5 comments:
people make mistakes. try cutting the GOP Kool-Aid you're drinking with some gin. The chill will do you good.
If Kevin G Hall isues a clarification I'll be happy to post it.
I don't know. FM&FM are not government or taxpayer funded, just secured. Protected. It's not like taxpayers are paying interest on Fannie and Freddie bonds. I don't think it's quite the same.
Now, obviously, we're paying the price, but what Palin was saying doesn't really make any sense - that the companies got too big and too expensive? Seems the oil companies are pretty big, and gas is pretty expensive. Just a quick comparison of how that kind of simple language can be really vague.
Correct me if I'm wrong, please...
By that far fetched assertion then all banks with FDIC are run by the government as well since depositor's money is guaranteed by the government. Ken Hall is correct. Working within, and having quite a bit of knowledge, most of your assertions are bogus anyway. Just like a politician though, if you don't have the facts, spread 1/2 truths and rumors. Take advantage of fears of employees. ALL newspaper companies are trying to move towards regional operations to save costs. What do most companies do when they merge?
Kevin G. Hall and David Goldstein were reported in "The Morning Call" in Allentown PA today (10/12/08) in an article titled "Report: Private sector led subprime mortgage push" states in part that the soring subprime lending at the core of the crisis was "...the private sector, not the government.." I refer you to an atricle in the "NY Times" dated 9/30/1999 which states "Fannie Mae, the nation's biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits." and "Fannie Mae has expanded home ownership for millions of families in the 1990'S by reducing down payment requirements,." said Franklin D. Raines, Fannie Mae's chairman. and chief executive officer. “Yet there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market."
So, it all started in the late 1990's.
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