RESOLUTION ON PROTECTING TAXPAYERS BY RESTORING SAFETY AND
SOUNDNESS TO GOVERNMENT-SPONSORED ENTERPRISES
WHEREAS, Housing remains the single largest asset for most American families, and each year
America’s housing sector (comprised of housing services and residential investment) contributes
over 15% to U.S. gross domestic product;
WHEREAS, The United States Congress has previously enacted legislation to help make
homeownership more affordable and accessible for qualified homebuyers by improving secondary
loan market liquidity;
WHEREAS, For decades, two Government-Sponsored Enterprises – Fannie Mae and its smaller
sibling, Freddie Mac – have made home ownership possible by providing trillions of dollars in
mortgage financing to America’s housing market, enabling millions of families to buy, refinance
or rent homes;
WHEREAS, For decades, Fannie Mae and Freddie Mac have fulfilled their historic role of
providing the mortgage market with adequate levels of liquidity at all times, enabling the uniquely
American and highly popular 30-year fixed rate mortgage to exist;
WHEREAS, For decades, Fannie Mae and Freddie Mac have been privately owned, publicly
traded mortgage insurance companies providing enormous benefits to America’s housing market
without costing taxpayers a penny;
WHEREAS, Since 2008, Fannie Mae and Freddie Mac have been held captive in a perpetual
federal conservatorship that has hamstrung their ability to help communities gain access to
homeownership;
WHEREAS, Misguided policies initiated by the Obama Administration triggered a dramatic
decline in America’s homeownership rate, which in 2016 hovered near a 50-year low, and fueled
a serious rental affordability crisis;
WHEREAS, In 2012, the Obama Administration attempted to nationalize Fannie Mae and Freddie
Mac by unilaterally imposing terms that would render the companies permanent wards of the state;
Republican
National
Committee
Counsel’s Office
WHEREAS, The Obama Administration misused Fannie Mae and Freddie Mac as an illegal
piggybank to advance its domestic policy agenda, unlawfully usurping over $130 billion from both
companies to (i) avoid earnest negotiations with congressional Republicans on the debt ceiling,
(ii) support administration prerogatives without seeking congressional authorization, and (iii)
artificially reducing the federal budget deficit to create a false “legacy of fiscal responsibility”;
Whereas, Despite their enormous profitability over the last six years, Fannie Mae and Freddie
Mac’s capital reserves are scheduled to be entirely confiscated at the end of 2017, which will leave
two of the largest insurance companies in the United States without any capital buffer to protect
taxpayers and support the housing market;
WHEREAS, The Community Home Lenders Association, Community Mortgage Lenders of
America, Independent Community Bankers of America, Leading Builders of America, National
Association of Realtors, and other organizations have all publicly expressed concerns about the
scheduled elimination of capital reserves held by Fannie Mae and Freddie Mac, and the associated
negative ramifications for our economy;
WHEREAS, By prolonging Fannie Mae and Freddie Mac’s current state of limbo, the federal
government is fostering continued market uncertainty, unnecessarily exposing taxpayers to
financial risks, and exacerbating our Nation’s housing problems; and
THEREFORE, BE IT:
RESOLVED, The Republican National Committee recognizes the longstanding economic
benefits of a robust housing sector as well as the importance of promoting responsible
homeownership and preserving the 30-year fixed rate mortgage;
RESOLVED, The Republican National Committee recognizes that no financial institution in the
United States can safely operate without adequate capital, and that taxpayers will not be
sufficiently protected until Fannie Mae and Freddie Mac are permitted to rebuild equity capital;
RESOLVED, The Republican National Committee recognizes that the United States Treasury has
recouped all of the money that it invested in Fannie Mae and Freddie during the 2008 financial
crisis, plus over $80 billion in profits to date, and that the Treasury can generate an estimated
$100 billion in additional cash profits by monetizing its warrants for 79.9% of each company’s
common stock;
RESOLVED, The Republican National Committee recognizes the sanctity of property rights in
America, and acknowledges the need to resolve the outstanding claims of Fannie Mae and Freddie
Mac shareholders in a manner that honors and respects the rule of law governing the rights of
corporate stockowners;
RESOLVED, The Republican National Committee calls upon our President, Members of
Congress, and Governors to protect taxpayers from future bailouts by supporting administrative
action that restores safety and soundness to Fannie Mae and Freddie Mac.
AI
