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  3. The question of what to do about Fannie Mae and Freddie Mac—the two government-created enterprises that have backed massive loan

The question of what to do about Fannie Mae and Freddie Mac—the two government-created enterprises that have backed massive loan

admin2015-03-25  69
问题     The question of what to do about Fannie Mae and Freddie Mac—the two government-created enterprises that have backed massive loans to the housing market—involves much more than finance or real estate. It marks the end of an era. The relentless promotion of homeownership as the embodiment of the American dream has outlived its usefulness.
    In some ways, owning a home contributes to neighborhood stability and encourages property improvement. Unfortunately, we let a sensible goal become a foolish fetish. Not everyone can become a homeowner. Some are too young and footloose; some are too old and dependent; some are too poor or irresponsible. Even with these gaps, homeownership is virtually universal among the middle-aged middle class.
    Government subsidizes homeownership in two ways: through tax and spending policies and through credit markets. Tax breaks for homeowners exceeded $120 billion in 2009. These benefits go heavily to higher-income borrowers, who are encouraged to buy bigger and more expensive homes that generate larger tax savings. This is both unfair and unnecessary. By contrast, government subsidies for lower-income renters are skimpier, totaling about 25 percent of the support for homeowners.
    The cheap credit subsidy operates mainly through Fannie Mae and Freddie Mac. These government-sponsored enterprises(GSEs)were economic mongrels: profit-making companies that were given goals of expanding homeownership among poorer buyers. The GSEs could borrow at interest rates barely above the U. S. Treasury’s, because investors regarded Fannie and Freddie bonds as backed by the government.
    It seemed a perfect marriage: The GSEs would earn profits and pass along the benefits of cheaper credit by financing or guaranteeing mortgage loans. Congress could promote homeownership outside budget constraints. But the marriage between private profit and public purpose failed. In September 2008, the Bush administration took over Fannie and Freddie, which faced huge losses from bad mortgages.
    In an ideal world, we would throw away failed policies. We would change or end the mortgage-interest tax cut. We would tighten the GSEs’ loans and guarantees. The trouble is that the ideal solution may be temporarily undesirable. The housing market, as everyone knows, has collapsed.
    Ironically, the GSEs have become more important than ever. Private lenders, which once regarded a mortgage secured by a home as a highly safe investment, now see it as highly risky. Few new mortgages are made without government guarantees.
    This means that sudden withdrawals of support might deepen housing’s depression. Some economists have made sensible proposals to scale back Fannie and Freddie. But done too quickly, they could backfire.
    The single-minded promotion of homeownership failed and, paradoxically, undermined the American dream. It contributed to the housing "bubble" and favors housing investment over new industries and technologies. But to end it, we need to make haste slowly.
The failure of homeownership promotion resulted in
选项 A、the American dream realistic.
B、housing "bubble" broken.
C、more housing investment.
D、more new industries and technologies.
答案C
解析 事实细节题。根据题干关键词The failure of homeownership promotion可以定位至最后一段。该段第二句指出：促使私人购买房屋的观念造成了住房“泡沫”的产生而且让美国人将重点投资放在房屋上，因此可知[C]正确，同时可知[B]错误；最后一段第一句指出：这种观念反过来破坏了美国梦，因此可以排除[A]；同样，该段第二句指出：这种观念让美国人将重点投资放在房屋上，而非新的工业和科技上，因此排除[D]。
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