Fannie and Freddie Should Pay Dividends to the Taxpayers Not the Treasury Department

A blog about business and economics.
Nov. 8 2012 12:19 PM

Fannie and Freddie Should Pay Dividends to the Taxpayers Not the Treasury Department

I read with interest Matt Zeitlin's piece on Freddie Mac's latest earnings report and how basically the GSEs are back to making money and paying net  to the Treasury. His bottom line:

So far both companies have received a combined $187 billion from the Treasury and given back about $47 billion in dividend payments. As the housing market improves and the GSEs standards stay tight, the second number should start to grow steadily higher. The taxpayer will likely not be made whole on its “investments” in Fannie Mae and Freddie Mac. But four years after the government came riding to the GSEs rescue, we can finally draw a line on the taxpayers’ housing liability.

Now in this context "the taxpayer" is metonymy for the U.S. Treasury. Fannie and Freddie aren't giving me any money. But maybe they should. Having the GSEs remit their dividends to the taxpayers as checks mailed out to American citizens would be sounder economic policy. Given the ultra-low interest rates currently prevailing, the Treasury doesn't actually need this money. Redirecting it straight to the American people might be a politically feasible form of stimulus.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.


Medical Examiner

The Most Terrifying Thing About Ebola 

The disease threatens humanity by preying on humanity.

I Bought the Huge iPhone. I’m Already Thinking of Returning It.

Scotland Is Just the Beginning. Expect More Political Earthquakes in Europe.

Students Aren’t Going to College Football Games as Much Anymore

And schools are getting worried.

Two Damn Good, Very Different Movies About Soldiers Returning From War

The XX Factor

Lifetime Didn’t Think the Steubenville Rape Case Was Dramatic Enough

So they added a little self-immolation.


Blacks Don’t Have a Corporal Punishment Problem

Americans do. But when blacks exhibit the same behaviors as others, it becomes part of a greater black pathology. 

Why a Sketch of Chelsea Manning Is Stirring Up Controversy

How Worried Should Poland, the Baltic States, and Georgia Be About a Russian Invasion?

Trending News Channel
Sept. 19 2014 1:11 PM Watch Flashes of Lightning Created in a Lab  
  News & Politics
Sept. 20 2014 11:13 AM -30-
Business Insider
Sept. 20 2014 6:30 AM The Man Making Bill Gates Richer
Sept. 20 2014 7:27 AM How Do Plants Grow Aboard the International Space Station?
  Double X
The XX Factor
Sept. 19 2014 4:58 PM Steubenville Gets the Lifetime Treatment (And a Cheerleader Erupts Into Flames)
  Slate Plus
Slate Picks
Sept. 19 2014 12:00 PM What Happened at Slate This Week? The Slatest editor tells us to read well-informed skepticism, media criticism, and more.
Brow Beat
Sept. 20 2014 3:21 PM “The More You Know (About Black People)” Uses Very Funny PSAs to Condemn Black Stereotypes
Future Tense
Sept. 19 2014 6:31 PM The One Big Problem With the Enormous New iPhone
  Health & Science
Bad Astronomy
Sept. 20 2014 7:00 AM The Shaggy Sun
Sports Nut
Sept. 18 2014 11:42 AM Grandmaster Clash One of the most amazing feats in chess history just happened, and no one noticed.