There are those who blame deregulation for our financial woes. It isn’t the cause.
We all accept some sense of regulation in an economy such as ours. Regulation should enforce honesty, transparency, accuracy and compliance with the law. Regulation should not be a form of legislation and social policy.
Fannie Mae was exempted from SEC regulation, expempted from taxes, and expempted from Sarbannes-Oxley. Fannie Mae was used to enforce a policy to put people in houses that could not afford them.
Fannie Mae was regulated directly from Congress. It did not fail because of deregulation but from misregulation.
Regulatory agencies should be independent of political agendas. The very people regulating and over seeing Fannie Mae were receiving campaign contributions, and in the case of Christopher Dodd, were receiving perferential loans (from Countrywide) in a manner that is likely illegal.
There are good and bad regulations, but regulations used to enhance the political power of the party in power is the absolute worst.
Who regulates the regulators?