FreedomWorks Urges Congress to Sign the Bachmann Letter on the Affordable Housing Trust Fund

Business Wire, Sept 11, 2008

Dick Armey Salutes Rep. Michele Bachmann for Defending Taxpayers in Fannie/Freddie Aftermath

WASHINGTON -- FreedomWorks, the national grassroots advocacy organization, is asking all Members of Congress to sign the letter authored by Rep. Michele Bachmann, which asks the Bush Administration to freeze new spending on the Affordable Housing Trust Fund. The Trust Fund is funded by a new levy on the GSEs Fannie Mae and Freddie Mac.

Rep. Bachmann had the foresight to oppose the Dodd-Frank housing bill, which passed in late July and opened the door for the largest taxpayer bailout in American history. Now she is leading the effort in Congress to limit the government's losses from the bailout, which is now underway.

Last weekend, empowered by the Dodd-Frank bill, the Dept. of Treasury moved to place the quasi-private mortgage lending giants, Fannie Mae and Freddie Mac into federal "conservatorship." The Treasury plan contains no structural reform and actually expands Freddie and Fannie lending and underwriting activity through 2009. Taxpayers will eventually be directly responsible for GSE losses. Most analysts think the government's costs will exceed $100 billion dollars or more.

Rep. Bachmann's letter reads in part: "The very fact that the GSEs need such a massive taxpayer bailout is proof that siphoning funds from these entities to finance the Housing Trust Fund would be irresponsible and harmful to homeowners, taxpayers, the GSEs, and America's financial markets."

FreedomWorks Chairman and former U.S. House Majority Dick Armey commented:

"We salute Rep. Bachmann for her tireless work in defense of U.S. taxpayers. The Affordable Housing Trust Fund is an unnecessary boondoggle, and funding it only further reduces the capital base of the floundering GSEs. Every penny diverted to the Trust Fund today will add the total bailout cost for taxpayers.

"As the housing market corrects from bubble prices, one of the benefits is that home prices are becoming more affordable again. The Affordable Housing Trust Fund is unnecessary and constitutes new spending that will eventually add to the budget deficit and the size of the GSE bailout. FreedomWorks urges all Members of Congress to sign the Rep. Bachmann letter."