Look elsewhere Mr. Gasparino, Mark Calabria won't be your foil

What will Mark Calabria do as head of the FHFA?
He will be a good and loyal Administration soldier

The Senate Banking Committee (SBC) has scheduled a committee vote this week on Mark Calabria’s nomination to be the new Director of the Federal Housing Finance Agency (FHFA), the GSE regulator. The vote easily should go Calabria’s way, making his full Senate approval just as smooth. No schedule for the latter, but no real reason to hold it up.

MC and I may have crossed DC paths at some point in the past dozen years or more, but I don’t remember meeting him. I have read Calabria’s written material and reviewed other positions he’s taken. My views are based more on certain existing political hierarchies and tradition than Calabria’s conservative product on the SBC or his Cato Institute work.

Calabria has indicated in the past that he wishes the 30-year fixed rate mortgage (FRM), probably 15-year, too, would go away, so do most bank lenders; MC also has indicated he thought the unprecedented all profits 2012 GSE "sweep" is bad policy (since it denies the GSEs a ton of capital which their @$290 Billion of earnings should have generated). He also isn’t a fan of the GSE’s affordable lending obligations and by extension similar rules for primary market participants. And he also hopes Congress will approve legislation to revamp the nation’s mortgage market, so he doesn’t only possess the chore.

Strong personal views, but hardly political winners in the year before the major 2020 elections.

Will President Trump campaign on ending fixed rate mortgages or affordable mortgage lending for moderate and low-income families who qualify??

And I can't see any of the Dems doing so, when all their internecine bloodletting concludes.

I may be wrong, but I don’t think questioning Calabria’s GOP loyalty quotient rises to the bizarre scare level of Fox Business News, Charlie Gasperino and his colleague Lydia Moynahan are floating, predicting a fractious dispute between Calabria and the current acting FHFA Director, Joseph Otting, Treasury’s Crag Phillips, and Treasury Secretary Steve Mnuchin.

(See the Fox News article linked below.)
https://www.foxbusiness.com/politics/fannie-and-freddie-fist-fight-brewing-amid-trump-administration-infighting

I believe this is a case of a very worried anti-GSE crowd whistling past the policy graveyard knowing this WH (and by extension Steve Mnuchin) is capable of following its own GSE drummer, quietly mouthing “bipartisan cooperation” to the Hill, while simultaneously gesturing it thinks the “Congress is #1”—at least I believe that’s what that one finger salute means—but then going its own way.

So we hear from worried Gasparino, Alex Pollock, and various other Rightwing solons—not accustomed to being on the defensive--ramping up their fears this Administration might move on its own, realizing that Congress—even when it was run by the GOP—couldn’t produce GSE restructuring or reform legislation.
The Righties are trying to sow doubt and foster "black flag" fantasies
to slow what might be an effort to resolve administratively these contentious matters flowing from the GOP's 2008 Fannie and Freddie "conservatorship" declaration.

But, as one Admin GSE principal was quoted at the Pepperdine GSE conference, “If we don’t do it, who will?”

Poor Charlie—who has been savaged in various blogs, especially where GSE investors hang out—has been called a ton of angry names, with “GasBag” and related memes the most printable in a community blog.
In this piece, Gasparino was reduced to quoting ”unnamed” WH sources worrying about Calabria going off track. C’mon Charlie, name a few names?

Calabria—until he demonstrates otherwise—I think is a team player, a staffer to the SBC and former chairman Dick Shelby (R-Ala.), CATO fellow, and VP Pence’s chief economist. That’s a lot of GOP heritage against which to rebel and still hold onto his new job.

I think it would be most unlikely, and indeed uncomfortable, if Calabria leads a revolt against the WH—as Gasparino would like you to believe—given MC’s lineage.

IMO, when/if a Trump executive or regulatory action comes, it will be a Treasury-blessed event, with Calabria on board. He may even be given a starring role in a few weeks, if the White House agrees to let Fannie and Freddie keep their last quarter’s earnings to build some capital base and for Calabria to announce that fact.

I keep returning to a major reality. The reason it has been so difficult--for the past 10 years to blow up the GSEs and start over, whatever the scheme-- is they work and have worked in the past. Plus, the nation’s largest financial institutions--which for years have begged Congress to do away with Fannie and Freddie--are not reliable stewards of both the nation’s primary, which they run now, and also the secondary mortgage markets for which they yearn.

The banks just can’t be trusted.

Fannie and Freddie succeed too much—even with their FHFA shackles--first and foremost for consumers who aspire to own a home of their own. The two also produce for system professionals, i.e. Realtors, builders, lenders of various types and sizes, who populate the mortgage finance system and rely on those GSE  borrowers.

And, while I am on it, no Democrat in the Congress will oppose making mortgage finance more available to qualifying lower-income families.

Charlie and friends, don’t go back to your erroneous pre-2008 GSE beliefs since you really don't understand what Hank Paulson did to the GSEs and why? It wasn’t about Fannie and Freddie having losses and not being able to access the domestic and foreign debt markets.

It was ideological, not structural! The facts are there for all of you to read.

Maloni, 2-25-2019