Rep. Barney Frank said Friday that the House Financial Services Committee, which he chairs, will be recommending the abolishment of Fannie Mae and Freddie Mac in their current form and ‘coming up with a whole new system of housing finance.’
‘That's the approach, rather than a piecemeal one,’ Frank said.
The Obama administration is expected to outline its plans for the government-sponsored enterprises (GSEs) as part of its fiscal-year budget that is set for release next month. The Treasury Department's Dec. 24, 2009, decision to uncap federal support for the GSEs has undergone harsh criticism from lawmakers, including six Republican senators who, in a letter to Senate Banking Committee Chair Chris Dodd, D-Conn., last week, pushed for an investigation on the matter.
"I don't know anybody who thinks Fannie and Freddie should continue," Frank said Friday.
Treasury Secretary Tim Geithner, in a PBS NewsHour interview Thursday, said the administration is committed to proposing a set of reforms this year. He was doubtful the legislative process would begin until next year, "because it's just a complicated thing to get right."
"But we are completely supportive and agree completely with the need to make sure that we take a cold, hard look at what the future of those institutions should be in our country," Geither added.