In 2003, the New York Times published an article about growing concerns over growing debt, risky mortgages, and questionable accounting practices at quasi-government businesses Fannie Mae and Freddie Mac. The following passage, featuring move-along, nothing-to-see-here quotes from the now-chair of the House Financial Services Committee Barney Frank (D-Mass) and committee member Rep. Melvin Watt (D-N.C.), seems relevant given what we know today:
Among the groups denouncing the proposal today were the National Association of Home Builders and Congressional Democrats who fear that tighter regulation of the companies could sharply reduce their commitment to financing low-income and affordable housing.
"These two entities—Fannie Mae and Freddie Mac—are not facing any kind of financial crisis," said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. "The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing."
Representative Melvin L. Watt, Democrat of North Carolina, agreed.
"I don't see much other than a shell game going on here, moving something from one agency to another and in the process weakening the bargaining power of poorer families and their ability to get affordable housing," Mr. Watt said.