Warren Buffett got a lot of attention a while back by begging the government to raise his taxes so I thought I would go for the same publicity by begging the government to raise the guarantee fees that Fannie Mae and Freddie Mac charge on mortgages that they guarantee.
The National Association of Realtors, The National Association of Homebuilders, and the Mortgage Bankers Association just love the free lunch bestowed upon them by Fannie and Freddie because it helps their business by lowering the cost of mortgages. Of course, there is no free lunch. The guarantees that Fannie and Freddie have provided ended up costing taxpayers $140 B so far. Simply put, the reason is that these two institutions were not charging enough for their guarantees. Not to mention that the SEC has just charged six former top executives at Fannie Mae and Freddie Mac with misleading investors about risky subprime loans the that mortgage giants held during the housing bubble.
So the obvious solution is to raise these fees. In addition, with the government's desperation to raise revenue, this is an attractive option for both sides of the political spectrum. Those on the left want to increase revenue and those on the right want to eliminate government involvement in what should be a private sector endeavor. Except the real estate industry is on their own political spectrum because they just love their special treatment and don't want mortgage rates to go up to cover these higher fees.
As for me...a lot of people assume that because I'm a realtor I support these handouts but it should be obvious from my tone here that I don't. I'm against government subsidies whether they benefit me or not so I'm pulling a Warren Buffet here and begging the government to take mine away. Think I'll get the same attention as Warren did?
This whole topic has heated up recently as part of the broader discussion about extending the payroll tax cuts because raising the Fannie and Freddie guarantee fees is one way to pay for the extension. As you might expect the realtors, the home builders, and the mortgage bankers are all up in arms and have put their lobbying effort into overdrive.
And while I'm at it...I support the National Transportation Safety Board's recommendation to ban cell phone use while driving. This is probably another proposal that realtors won't like because God knows they are so important that they need to talk while driving. All I need to know is that when I'm driving down the road and someone is weaving in and out of their lane at 10 MPH under the speed limit 9 times out of 10 they are yapping away on their cell phone.