Rep. Jeb Hensarling (R-Texas) released a critical statement last week in response to President Obama’s speech marking the fifth anniversary of the financial crisis.
“It looks like the White House is putting more effort into convincing Americans they’ve solved the financial crisis than into actually solving the cause of the crisis,” Hensarling said. “The crisis resulted largely from misguided Washington policies that either strong-armed or enticed financial institutions into loaning money to people to buy homes they sadly couldn’t afford to keep.”
Hensarling pointed to the Dodd-Frank Act, which sought to reform the financial system and end taxpayer-funded bailouts, but he said the law, instead, “enshrined” bailouts and America’s “too big to fail” institutions into law.
“No one in Washington can truly say they’ve addressed the financial crisis until a sustainable housing finance reform plan has been passed and signed into law,” Hensarling said. “Given the magnitude of the crisis and the pain it caused millions, the President’s lack of serious attention to housing finance reform has set the stage for the next crisis as taxpayers today are on the hook for more than $5 trillion in mortgage guarantees. Our committee recently approved legislation that creates a sustainable housing finance system by limiting government control, putting private capital at the center of the mortgage system, and giving homebuyers more informed choices about their mortgage options. The five-year anniversary of the crisis represents the perfect opportunity for the President to join us in this effort.”
Hensarling urged the president to join in the committee’s effort to reform the housing finance system. In July, the committee passed the Protecting Taxpayers and Homeowners Act, which seeks to phase out Fannie Mae and Freddie Mac and reduce the role of government in the housing finance market.