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Didn't FDR see this coming in 1938?
When Franklin D. Roosevelt created Fannie Mae as a feel-good social project in 1938, did anyone object that 70 years later it would cause a worldwide economic collapse? Just curious if anyone brought it up...
"It's That Guy" -- you are wrong, recent history is all too clear that the Republicans have been attempting to regulate Fannie Mae for years, and it's precisely the Democrats who have fought that down.
2 Answers
- OPMLv 71 decade agoFavorite Answer
In 1938 it was a good idea. FDR's idea was to keep trying things until you found things that worked. The Administration discarded things that ended up being bad ideas and kept the good. In 1938, the banks were in shambles so there were no loans at all for homes. Fannie Mae was designed to make loans using money the Treasury borrowed until the banking system recovered. The problem is that once it was set in motion deep seated powers kept working to keeping it going. It was converted to a private corporation but wasn't allowed to operate as one truly. That is the problem, it was told to act as a private finance company AND a Federal agency at the same time.
- Anonymous1 decade ago
The problem is not with Fannie Mae, but how it was administered. Roosevelt saw that the government imposed regulations to prevent a recurrence of the trouble in 1929, and for a long time there was no trouble. But since Reagan, Republicans have fought for deregulation. It was a short-sighted policy, bound to bite us on the butt sooner or later.
