The Journal's Fannie Mae Fetish

There are many great things about The Wall Street Journal but its Fannie Mae coverage can be bizarre. Today's front-page story is an advertisement for the Government Sponsored Enterprise touting Fannie Mae as an important buffer for the free-falling mortgage market. It's true that compared to Countrywide or other operations Fannie Mae looks admirable for its less speculative ways. But the long standing case against Fannie Mae, Freddie Mac and the other GSEs is still the same: They enjoy an unfair advantage over their competitors and are the worst of public and private enterprise, private profit with socialized risk. As a District of Columbia taxpayer, I'm always offended by their tax exempt status. It would be crazy in this market to take away Fannie Mae's government charter and roil the markets further. (The WSJ op-ed page has been on a jihad about Fannie Mae, fueled in part, no doubt, by the high profile Democrats who have worked there like former OMB Chief Frank Raines and Jim Johnson.) The right lesson from the credit crisis is more, smarter regulation of the housing finance industry not expanded powers for this clumsy hybrid. Today's leader quotes Angelo Mozilo singing praise for Fannie Mae. Is that who we really want to listen to right now? Oh, please.