Contact: Barbara Riley
Sunday, September 7, 2008

WASHINGTON, DC – United States Senator John Sununu (R-NH) today (9/7) issued the following statement regarding the announcement that the federal government will take over the mortgage finance giants Fannie Mae and Freddie Mac:

“I introduced legislation to rein in these mortgage giants over five years ago, but was fought every step of the way by their executives, lobbyists, and liberals like Chuck Schumer who stood in the way of a tough bill. Fannie and Freddie were allowed to grow too quickly and for too long without the strong oversight required of such government chartered firms.

“In July, Congress finally passed the basic reforms I called for years ago; now the Treasury Department and their new regulator should use every power they have to protect American taxpayers from the risks posed by these companies today and in the future.

“In the short term, we need to restore stability and integrity to the credit markets for homeowners, small businesses, and consumers that depend on them every day. In the long term, the Government Sponsored Enterprises (GSE) should be transformed into fully independent firms that compete fairly in the market and do not benefit from direct or implied taxpayer guarantees.


“The board members and management have misused the public trust that comes with the responsibility of operating a government sponsored entity. Now it's time to put the taxpayers interests first - once and for all."
 
Senator Sununu, a member of the Finance Committee, former member of the Senate Banking Committee, and former Vice-Chairman of the House Budget Committee, has a lengthy record of advocating for strong GSE reforms. Key actions and milestones include the following:

As a Member of the House Budget Committee, Sununu chaired a Budget Committee hearing that addressed the systemic risks to the American finance system posed by the investment portfolios held by the GSE’s.

On July 31, 2003, Sununu joined Senators Chuck Hagel (R-NE) and Elizabeth Dole (R-NC) in introducing legislation to strengthen and improve the oversight of Fannie Mae and Freddie Mac. This bill (S. 1508) passed the Senate Banking Committee in April 2004.

On January 26, 2005, Sununu, Hagel, and Dole re-introduced legislation (S. 190) to improve oversight of GSE’s. A bill incorporating many provisions of the Sununu, Hagel, Dole legislation passed the Committee by a vote of 11 – 9 on July 28, 2005.

On March 14, 2006, Sununu and Hagel (R-NE) introduced an amendment to the Lobbying Reform Bill that would review the lobbying activities of GSE’s such as Fannie Mae and Freddie Mac. The amendment would direct the Government Accountability Office (GAO) to study the lobbying activities of GSEs to determine whether these activities further their statutory housing mission. The amendment would also require the Secretary of Housing and Urban Affairs (HUD) to conduct annual audits of the Fannie Mae and Freddie Mac Foundations.

On April 12, 2007, Sununu, Hagel, Dole, and Senator Mel Martinez (R-FL) re-introduced legislation (S. 1100) to improve oversight of GSE’s.  The major reforms in their bill were included in final legislation passed the Senate on July 26, 2008 and was signed into law on July 30, 2008.

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