Housing giants Fannie Mae and Freddie Mac have been in federal conservatorship since their collapse in 2008. As part of the deal, Congress gave them permission to use taxpayer money to fund the activities of housing advocacy groups like ACORN. But the regulator overseeing Fannie and Freddie quite sensibly stopped these payments.
Of course, now these advocacy groups are demanding the spigot be turned back on—and they want a permanent “trust fund” of taxpayer dollars to pay for it. This is a bad idea, Heritage Foundation experts Norbert Michel and John Ligon argue:
- Housing groups use these funds to encourage banks to make more of the ill-advised home loans that contributed to the recent financial crisis, and
- There is virtually no control over any non-housing activities (such as lobbying for additional housing grants and registering voters) that advocacy groups undertake after they receive this trust fund money.
Lawmakers should resist any push for creating a housing trust fund and evaluate the success of existing housing programs, Michel and Ligon say.
Do you think your tax dollars should go to permanent “trust funds” for housing activists?