Newt Gingrich and Government Sponsored Enterprise
Again, I was planning on taking a little time off from posting but circumstances are conspiring to make me throw in my two cents. Now, according to our new front-runner, Newt Gingrich, who has proclaimed himself the nominee, he is the most conservative candidate. Interesting article from Bloomberg with a remarkable quote from Gingrich. Here is the most telling part of the article:
Newt Gingrich in 2007 extolled the virtues of Freddie Mac (FMCC), saying he would be “very cautious” about changing the way the mortgage-finance company’s public- private business plan operated.
In an interview placed on Freddie Mac’s website, the Republican presidential candidate said the U.S. government sponsored enterprise, or GSE, could serve as a guide for rebuilding the hurricane-ravaged Gulf of Mexico, improving health care and funding space exploration. For decades, Freddie Mac collected profits while benefiting from an implicit taxpayer guarantee of its debt,
“I’m convinced that, if NASA were a GSE, we probably would be on Mars today,” Gingrich said in the April 24, 2007, web post.
“While we need to improve the regulation of the GSEs, I would be very cautious about fundamentally changing their role or the model itself,” he said. It “marries private enterprise to a public purpose.”
At the time of his comments, Freddie Mac and its larger rival Fannie Mae were under fire from Republicans, who said their government charters allowed them to make profits for shareholders while putting taxpayers at risk. Gingrich, a former U.S. House speaker, has voiced criticism of the companies in recent years.
The companies’ government backing made home loans artificially inexpensive and allowed the companies to squeeze private players out of the mortgage-lending business, their critics said.
Don’t you just feel the conservatism from Newt?