Fannie, Freddie Bailout Could Cost Taxpayers $25 Billion

New York Times:

WASHINGTON -- The proposed government rescue of the nation's two mortgage finance giants will appear on the federal budget as a $25 billion cost to taxpayers, the independent Congressional Budget Office said on Tuesday even though officials conceded that there was no way of really knowing what, if anything, a bailout would cost.

The budget office said there was a better than even chance that the rescue package would not be needed before the end of 2009 and would not cost taxpayers any money. But the office also estimated a 5 percent chance that the mortgage companies, Fannie Mae and Freddie Mac, could lose $100 billion, which would cost taxpayers far more than $25 billion.

Read the full story here

-OR-

Read about Secretary Paulson trying to sell the rescue to the general public

Read the whole story: New York Times

Comments

[joebaggadonuts]

I seem to recall that the Administration promised us the Iraq war would cost between 50 and 60 billion. OK, so if we do a straight line extrapolation, that means that bailing out these GSEs will cost the US Treasury, that is, OUR TAX DOLLARS, about half a TRILLION. Right? Am I missing something here?

http://www.cnn.com/2003/ALLPOLITICS/01/01/sproject.irq.war.cost/

[Poboy]

NO.

If anything, your estimation is CONSERVATIVE.

Here is the 411:

That $25 billion dollars supposedly scored by the Congressional Budget Office is a sham.

The line that is being crossed here is the implicit government backing of the GSEs is now going to become EXPLICIT, meaning that the government is going to co-sign the entire $5 trillion dollars the GSEs underwriten.

[bikerdude]

He lied to us then and he is lying to us now. We have been had, folks.

[dora rice]

We are getting a tiny small income tax return from the government in the mail, while Fanny Mae Crooks squander 25 Billion , that would have been a nice downpayment for healthinsurance,
We can't afford to put gas in the tank and these crooks don't have to go to jail, and the government bails them out, how about all these people who lost their homes, what did they get from the government.

[ymax]

Freddie's CEO made over $13 millions last year.

Not too shabby for a company with $3 trillions in the HOLE.

AND they are going to host a cocktail party for the Retugs. during their convention.

This is some screwy counntry we have here.

[zippywpinhead]

no corporation left behind...

[instagladiator]

Oh I just love that - says it all! Thanks

[bikerdude]

Even if they move our jobs and manufacturing capability off shore and then import shoddy, inferior products being put together by slave labor, AND we subsidize this theft with tax incentives for these criminals.­..

[bayviking]

Based on what BushCo told us about the costs for invading Iraq, this BIG LIE virtually guarantees costs for the latest round of bailouts will exceed the S&L crisis ($5-600 billion).

meanwhile all of Paulson's cronies at Goldman-Sachs have been raking it in. Betting on the housing crisis, betting on the falling dollar, betting on the US collapse of manufacturing. Its easy when you're loaded with cash and inside information.

[joebaggadonuts]

it's easy when you don't fund the SEC and the DoJ is in your pocket.

[levibatgirl]

If we put that much money into feeding and clothing poor kids the trolls would pee in their pants.

But bailing out corporations with a huge welfare check when they engage in reckless and risky business practices is never wrong to the trolls.

[torrrep]

That's funny. I don't see poor kids around here going without clothes or food. What country do you live in?

[instagladiator]

You locked up in a penthouse in Manhatten by chance? Travel around the country and see for yourself. Oh, and don't forget to stop in at the small towns and rural areas.

[GeoLee]

Maybe you need to volunteer in an urban public school or at Salvation Army or Catholic Social Services and talk to people walking inthe door before they are either able to get help or turned away for lack of contributions that month. I know in my city we have a plan where people can donate items like beef jerky's in exchange for denim days at work to send home backpacks on the weekend iso get some kids through the weekends when school lunches are not available. In a school in which I worked 30 lucky kids got the back packs but over 90 needed them. There is almost 100% participation in the school breakfast program on Mondays, needles to say and little kids in urban school don't throw away items from school lunch like those in the areas where you must spend ALL of your time. In fact if there is a way they can go unnoticed they put anythign extra intheir pockets to take hom to their younger brothers and sisters...­I always looked the other way because I had been to many of the homes in my roll as social worker and knew the kids were not lying. You know that book Men are from Mars and Women are from Venus? Well, Republicans are from Pluto.

[KOisGod]

Lets not forget folks that the elites hate the middle class. We get in their way on the way to first class in the airport, we make them stand in line on the cruise ship Lido deck diner, we clog up the freeways, we have to eat and need health care and we are getting way to upset about the price of gas.

So they are systematically stripping us of our little earned retirements, ignoring a crumbling infrastructure (no money for THAT!), are so indebting the Govt that there will be nothing to continue SS and Medicare.

This is all going according to plan, a return to feudalism

The Haves, and THE HAVE NOT'S

[instagladiator]

Point well taken. I agree completely.

[NYCIC]

Exactly. What's another $25 Billion. Remember in "Casino Royale" when Felix, the C.I.A. spook, said to Bond, after offering to loan him millions to use against a bad guy at the gaming table, "Do you think we need the money?"

[Tom95134]

$25 billion? Hell, that only two months in Iraq.

[holeybuybull]

Aah, I just love the smell of disaster capitalism in the morning!

[dimaggio5]

Oh Hell, just put it on our tab. We'd hate to inconvenience the war mongers,this admin or the oil companies to pay for anything. After all, it is all about them anyway, isn't it ?

[darthdarcy]

If we just Pegged the Sub Prime Mortgages at 3% above the Fed Rate or even the Prime Rate not to go below 6.25-6.5% and forgave all penalties to date,....1­/2 or more of which are illegal as reported anyway then these people could stay in their homes and the lenders would not lose any money and not one dime of Tax Payers money would be needed to bail out either the lenders or the borrowers.­..

It's that simple...a­nd would avert a housing crisis when all these people have to seek rentals in the already inflated and limited rental market....­this will create serious downward pressure on those who can least afford it..and inflate rents even higher...

[bikerdude]

Thanks for that thoughtful comment. It makes sense to me.

[drkazmd65]

Of course it makes sense,... that's exactly why they won't do it.

Nobody in the greedy corporatist world would get to rake in the penalty & interest bucks if they did something that simple.

Where would the corporate welfare be in that package?

[doug108]

What's 25 billion dollars between friends? Besides, that money never could have done any good anywhere else, like in our education system or upgrading infrastructure or anything like that. It's a shame we won't have it to piss away in Iraq, though.

[Viper]

well, given we have lost in 12 months 20 trillion in housing value... 25 Billion or 100 billion is cheap, given the cost of further declines which would happend.

Of course we are here because of laisez faire capitalism­.. same with oil prices. Can we learn this time that ;aisez faire capitalism does not wrok any more than communism does or not having a speed limit on the street in front of your house. Human nature... given an inch and some one will take a mile and no one really wants to be equal.... if they did sprt contest would never have a winner. Records would never be broken.

Regards

[torrrep]

Wrong. We are here because Democrats passed laws such as the Community Investment Act of 1977 (Jimmy Carter) that forced banks to make loans to people who otherwise were not qualified to get them and also forced banks to meet lending quotas in neighborhoods that were not ideal for investment. The act also forced banks to offer subprime loans (1995 update by Bill Clinton) to people who could not afford to make these mortgage payments. Stop blaming capitalism. Stop blaming conservatives and stop rewriting history. Democrats got us into this mess and now you want to to tell us how to get out of it. Thanks. I think I'll pass.

[NickNas]

Where did that troll go that flamed me for 3 days when I said this was going to happen a coupleof weeks ago?? In fact he called ALL of us Idiots and worse. Hmmmmmmmm