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Cornyn Statement On Fannie Mae & Freddie Mac
Monday, September 8, 2008
WASHINGTON—U.S. Sen. John Cornyn, R-Texas, a member of the Senate Budget Committee, made the following statement today regarding the federal government’s takeover of Fannie Mae and Freddie Mac.
“The government takeover of Fannie Mae and Freddie Mac could conceivably put taxpayers on the hook for $200 billion. Taxpayers should not be in the business of rescuing shareholders, CEOs or those who made bad business decisions. Both institutions have demonstrated spending habits that should not be underwritten by taxpayers. We must hold fully accountable those individuals at Fannie Mae and Freddie Mac who failed to live up their responsibilities. This is why I could not support the American Housing Rescue and Foreclosure Prevention Act of 2008 (H.R. 3221), which provided Fannie Mae and Freddie Mac with an unlimited credit line to the U.S. Treasury.
“Unfortunately, this bailout could have been avoided. I have long advocated that Congress consider reforms to dramatically revamp how these government-sponsored enterprises do business. The reality is that business-as-usual in Washington must change. Firing the executives at these two companies should only be the first step, and not the last. That is also why I have been supportive of efforts by Senator Jim DeMint to permanently ban lobbying practices by these government-controlled entities.
“Finally, the government’s action raises a number of questions about the future role of Fannie Mae and Freddie Mac in our housing market. Allowing the status quo to continue will only bring greater debt and harm to American taxpayers. It’s time for real reform and a real debate on spending in Washington."
Sen. Cornyn serves on the Armed Services, Judiciary and Budget Committees. In addition, he is Vice Chairman of the Senate Select Committee on Ethics. He serves as the top Republican on the Judiciary Committee's Immigration, Border Security and Refugees subcommittee and the Armed Services Committee's Airland subcommittee. He served previously as Texas Attorney General, Texas Supreme Court Justice, and Bexar County District Judge.
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