Fannie Mae & Freddie Mac Under Fire for Bonuses

By: Brian Todd Email
By: Brian Todd Email

WASHINGTON 11/14/2011 -- You may not know Michael Williams, but you'd probably want to be paid like him. The same goes for Ed Haldeman.

They're the respective CEO's of Fannie Mae and Freddie Mac, the government-sponsored firms which back at least half the mortgages in America.

According to records from the securities and exchange commission, they each made about 900-thousand dollars in salary last year-- and each is getting paid about 2-million in bonuses.

Earlier this year-- the federal government approved nearly 13-million dollars in bonuses for Williams, Haldeman and eight other execs from the two firms.

Despite the fact that millions of Americans are still struggling to make it through the housing crisis and that Fannie and Freddie have been hemorrhaging cash this year.

They lost 10-billion dollars in the last quarter, and just asked Congress for more money.

Republican Senator John Thune is spearheading an effort by 60 Democratic and Republican Senators to cancel the bonuses. They've sent a letter to the government body that oversees Fannie and Freddie- the federal housing finance agency- asking it to revise the compensation policy for those execs.

The FHFA approved those bonuses.

Their overseer, the FHFA says it's reduced executive pay at Fannie and Freddie in recent years. That those firms have to pay that kind of money to attract the talent needed to manage 5-trillion dollars in mortgages.

When asked how big the bailout of Freddie Mac and Fannie Mae was compared to other bailouts analyst Cliff Rossi said, "Yeah - it was about $170-billion so far, for both entities - both Fannie and Freddie - and I think the estimated tally from what I understand from the Congressional Budget Office is somewhere in the neighborhood of $250-billion. So from that standpoint, it's large, relative to these other bailouts."

Analyst Cliff Rossi - who once worked at both Fannie and Freddie- says the current execs those firms were put in place since the bailout, to clean up the mess from before.. he says they have started to do that- but also says they haven't done enough to modify more home-owners' bad mortgages, so he's on the fence about whether they deserve their bonuses.

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  • by T.O.'d Location: Quincy on Nov 14, 2011 at 11:35 AM
    Man, the "blaming Bush" is really getting old-ALL of Washington is corrupt!
  • by George Location: Arizona on Nov 14, 2011 at 10:47 AM
    To everyone who thinks this is Obama's doing, or his fault or whatever... Seriously read about Bush's 2001 tax cut that immediately took us from a national surplus in funding (yea, or nation used to have money!), to debt overnight. Oh, and 5 bil a year to isreal in strictly military funding. I had more but i forgot because i've been up all night and i really dont care.
    • reply
      by tom on Nov 14, 2011 at 11:12 AM in reply to George
      Wasn't Obama a big cheerleader against big bonuses...... as attorneys say he opened the door now didn't he?
    • reply
      by Chris on Nov 14, 2011 at 01:58 PM in reply to George
      Oh good. I love hearing about the Clinton surplus. It's so easy to debunk because the only people who believe don't know debt v. deficit or national debt v. public debt. PUBLIC debt is debt held by the public and includes treasury bills and savings bonds. NATIONAL debt is public debt PLUS intragovernmental holdings. So if you check out the Treasury's website - you know, not MSNBC or Media Matters or the NY Times - you'll see that Clinton paid down the PUBLIC debt though never managed to square it since there was still a $66B debt when he left office. The NATIONAL debt was paid down with $17B remaining when he left office. Intragovernmental holdings, incidentally, increased under Clinton and dropped under Bush in his first year by some $50B. There's a reason behind that but I won't bore you with trivial facts and truths. Instead, we can all just agree: blame Bush, right?
      • reply
        by John on Nov 15, 2011 at 03:56 AM in reply to Chris
        Obama has has plenty of time to make improvements and has failed. Bush at least was consistant and wasn't as wishy washy. He can't do anything but campaign...and all that money that he's raising won't be able to buy off folks who've actually paid attention to his record.
      • reply
        by Anonymous on Nov 15, 2011 at 02:29 PM in reply to Chris
        You are correct. Everytime I hear 'Clinton surplus', I shudder. The myth/lie was started by Bill Clinton himself, and has been parroted by the MSM ever since. If you repeat a lie often enough, people not only believe it, but absolutlely swear by it. As you said, a simple look at the US Treasury website, is all it takes to see the truth. Unfortunately, those who keep echoing the lie, don't want themselves, or others, to know the truth.
    • reply
      by tom on Nov 15, 2011 at 03:27 AM in reply to George
      Clinton wasn't running a surplus but was taking from Social Security and Medicare to "balance the budget." Don't believe me then check the US governments own web site......Clinton was running a deficit too.
    • reply
      by Jim on Nov 15, 2011 at 04:03 AM in reply to George
      Obama hasn't improved the situation, only made it worse. Facts speak...and he has had nearly 3 years and what does he have to show for it? He added possibly the biggest entitlement in American history for the taxpayers to foot the bill even though people overwhelmingly opposed it. Still hasn't come up with a fiscal budget...Seriously? C'mon, he had complete control of congress for 2 years and still managed to only blame Bush.
  • by TOM Location: MADISON on Nov 14, 2011 at 10:40 AM
    Funny how B.O. was screaming about big greedy wall street giving bonuses after taking bailouts, but now he is defending Fannie and Freddie for giving bonuses when they are still taking more and more bailouts .....hypocritical at least.
  • by Wilma on Nov 14, 2011 at 09:32 AM
    This is what Obama wants. Why do you think they put him in office? Change is coming and it won't be pretty for those of us who like to keep what we have worked for.
  • by OMG!!! Location: Leon County on Nov 14, 2011 at 09:04 AM
    That's outrageous! Almost a million dollars a year in salary isn't enough? Bonuses should be based on their personal performance, not just "because I deserve it". With the housing market in the sewer and so many families losing their homes, how dare they even consider accepting several million dollars in bonuses?? That's what is wrong with our country today. Everybody wants their share of "the good life" when others are out of work, losing their homes, and so many don't have enough to eat. How could anyone with a modicum of a conscience even consider accepting such a bonus? Shame, shame, shame - on those who would award such a bonus and on anyone that would even consider accepting it! That money should be used to bail out people who are losing their homes, not some already overpaid desk jockeys!
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