“…My point: the GSEs are not worth saving because they do not serve a purpose that can even theoretically lead to any good for society. All they can do is distort the market, transfer wealth through price fixing from “late receivers” to “early receivers,” put our country deeper in debt, and provide more bureaus for politicians to use as plum patronage vehicles.
Yes, the GSEs are now doing most of this country’s housing business, and if we were to dismantle them, it would be quite painful. But it only follows then that we “must” bail them out if you believe all pain should be avoided. Keeping in mind that the outcome would be to alleviate all the above long-term ills, and lower home prices to a natural level so more people (including perhaps your children or grandchildren) can once again afford them without government aid, perhaps it is time for all of us to swallow that pill.”
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