Predictable and Avoidable

PREDICTABLE AND AVOIDABLE -- (House of Representatives - September 27, 2008)

Mr. WILSON of South Carolina. Mr. Speaker, as we debate the beginning of the financial crisis, it is important to cite a New York Times article published on September 30, 1999, which highlights the dangers of Fannie Mae easing credit requirements for loans it plans to purchase.

According to the author, the decision by Fannie Mae was meant to ``spur banks to make more loans to people with less than stellar credit ratings,'' and he forecasts that ``Fannie Mae is taking on significantly more risk.'' They ``may run into trouble during an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980s.''

These views were shared by Peter Wallison of the American Enterprise Institute, who remarked that ``the government will have to step up and bail them out.'' These are voices from the past predicting the problem we face today.

Indeed, it was not the failings of the free market, but the failure of those participating in the markets, as well as government mishandling, that has led to this current dilemma.

In conclusion, God bless our troops, and we will never forget September the 11th.

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