Panel OKs Bill To End Fannie, Freddie Bonuses

[Freddie Stubbs]

Source: NPR

Congress is seeking to end the practice of paying million-dollar bonuses to executives at government-controlled mortgage giants Fannie Mae and Freddie Mac.

The House Financial Services Committee approved legislation Tuesday that would suspend $12.8 million in Fannie and Freddie executive compensation packages and stop future bonuses. The vote was 52-4, with strong support from both parties.

The Senate is expected to take up a similar measure in the near future.

The government rescued Washington-based Fannie and McLean, Va.-based Freddie three years ago after they nearly folded because of big losses on risky mortgages they purchased. Taxpayers have spent about $170 billion to rescue the two firms, the most expensive bailout of the 2008 financial crisis. The government estimates the bailout could reach up to $220 billion through 2014.

Read more: http://www.npr.org/2011/11/15/142360979/panel-oks-bill-to-end-fannie-freddie-bonuses?ft=1&f=1014&sc=tw

[babylonsister]

1. Sounds like good news to me; rec'd. Now Senate, do your stuff. nt

[russspeakeasy]

2. This will turn out to be another can kicked down the road.

They will no longer be called bonuses, they will be called incentives.
Ever notice how eager politicians are to clean up other peoples houses as long as they don't have to handle any of the garbage?
I'm cynical I know....but there it is.

[unblock]

3. why not make them mutual companies?

where executive pay as capped and profits get distributed to homeowners, just as mutual insurance companies distribute profits to their customers?

i think mutual companies are far more defensible as public/private corporations than for-profit companies.

of course, you COULD just make it entirely a government function, but apparently that would be socialism and therefore bad, bad, bad.