Wednesday, October 29, 2008
Fannie Mae, Freddie Mac wielded big clout in Washington
Washington - Mortgage giants Fannie Mae and Freddie Mac didn't just dominate the nation's $12 trillion home loan market, they were also masters of influence in Washington.
As government-sponsored enterprises, Fannie and Freddie owned or guaranteed some $5 trillion in residential mortgages – a cushion for creating two of the most extensive lobbying operations in Washington.
At its peak – last week, just before the Treasury Department announced a government takeover – the operations ranged from campaign contributions and outright lobbying to a grass-roots charitable giving operation that covered nearly every congressional district.
"They were the most powerful companies in the country, and literally controlled the Congress," Peter Wallison, a senior fellow at the American Enterprise Institute. "Congress would not do anything they did not want Congress to do – and that came through some very sophisticated political activities and public relations that made it very difficult to challenge them."
Since 1990, Freddie Mac has contributed more than $9.7 million to federal campaigns. Fannie Mae's political action committee chalked up more than $2.9 million since 2004, according to the Center for Responsive Politics. Together, they spent some $7.4 million in lobbying in the first six months of 2008 alone.
That's just the beginning. What's most remarkable about the influence operation is its sheer vastness.
Over the last decade, Fannie and Freddie together hired nearly every lobby shop in Washington – so many, in fact, that opponents complained that they had trouble finding someone to represent their interests. ...