While Fannie Mae, Freddie Mac, and private lenders have deservedly garnered the bulk of attention and blame for the mortgage crisis, other federal programs also distort our mortgage market and put taxpayers at risk. The most prominent of these agencies is the Federal Housing Administration (FHA). The FHA currently backs an activity portfolio of over $1 trillion. Relatively small changes in the performance of the FHA’s portfolio could result in significant losses. As the taxpayer is, by law, obligated for any losses under FHA, these are not losses that can be avoided. Reasonably foreseeable changes to FHA’s performance could easily cost the taxpayer tens of billions of dollars, surpassing the ultimate cost of the Troubled Asset Relief Program bank bailouts. The panel will examine the fiscal health of FHA and examine policy proposals for reducing both the likelihood and severity of a taxpayer rescue of FHA.
Featuring Benjamin H. Friedman, Research Fellow in Defense and Homeland Security Studies, Cato Institute; Spencer Ackerman, Senior Writer, WIRED Magazine; and Julian Sanchez, Research Fellow, Cato Institute; moderated by Laura Odato, Director of Government Affairs, Cato Institute.
Featured PublicationWe are grateful to the Harry and Lynde Bradley Foundation and the Carthage Foundation whose support of the October 2012 Cato Conference “Europe’s Crisis and the Welfare State: Lessons for the United States” made possible this special issue of the Cato Journal.
Latest CommentaryAmartya Sen, as befits a Nobel laureate, has often produced careful calculations to throw light on dark situations, such as the number of...
Featured BookRenowned development economist Deepak Lal draws on 50 years of experience around the globe to describe developing-country realities and rectify misguided notions about economic progress.
More Bang for Your Buck
The Cato Institute tops a new measure of think tank performance in the United States, according to a recent report. Cato bested all other U.S. think tanks in the main category of “Aggregate Profile per Dollar Spent.” “I’m grateful to the Center for Global Development for showing that Cato gives its sponsors something I wish government gave more of to taxpayers: bang for the buck,” said Cato CEO John Allison.