THE BLOG

Fun with Fannie and Freddie

03/24/2014 11:48 am ET | Updated May 24, 2014

A recent summary of various polls of Congressional Job Approval was published at RealClearPolitics.com. The average numbers posted were 10.8 percent of respondents approving of the job Congress is doing, and 79.8 percent disapproving of congressional job performance. In many surveys done over the last few years, the comment heard often is that members of Congress are ineffectual, bickering and throwing mud, but accomplishing very little.

In 2013, there were five laws, of around 60 passed, that were particularly interesting in a discussion of job approval:

  1. A bill to set the size of new commemorative coins to be issued by the National Baseball Hall of Fame.
  2. A law honoring various people by using their names for government and military buildings and facilities.
  3. Former Senator Kay Bailey Hutchison from Texas had an entire section of the tax code named after her.
  4. A bill granting 28 acres of the Buffalo Gap National Grassland in South Dakota to construct the Minutemen Missile National Historic Site and parking lot.
  5. A law to grant the U.S. an easement to a 67 acre property in Mississippi known as the "bean field property." The easement is to restrict the use of the parcel to uses compatible with the Natchez Trace Parkway.

There's probably nothing really wrong with any of these initiatives, but with all of the economic, employment, and housing problems we have these days, perhaps other more important things could come first.

When it comes to the restructuring or outright dissolution of Fannie Mae and Freddie Mac, there has been a lot of talk, a couple of bills introduced, and nothing really accomplished. One group wants to see them go away completely, but with the intent to roll their functions into yet another government entity that will still be in the mortgage guaranty business. Another group wants to keep them around, just tinkering with the rules under which they operate. A third option, also with backers, is to liquidate their assets entirely, and not have any government involvement in housing finance.

There are a number of intricate actions and rules being proposed, some of which would leave current investors holding a bag of air while taking actions to let the taxpayers off the hook for some of the massive debt, as well as stopping all future bailout actions. The fact is that we'll almost certainly see nothing being done this year along any of these lines.

With political pundits generally agreeing that the Democrats will not be able to take the House in the November elections, there will not be much substantive work in Congress until after November. With a lot at stake in this year's elections, few incumbents will want to do anything crucially important for fear of alienating some constituent groups. After the elections, if the situation doesn't change with the houses split as they are now, it's likely that we're in for a long period in a decision vacuum when it comes to the tough problems we face. As a popular country western song says, we need "a little less talk and a lot more action."