The Dept. of Housing and Urban Development has been roundly blasted for neither working to avert the subprime mortgage crisis nor properly responding to it. But how much did HUD actively cause the crisis?

According to the Washington Post’s Carol D. Leoning, quite a bit. HUD didn’t properly police Fannie Mae and Freddie Mac, the public-private mortgage financiers, as they ran up $434 billion in subprime mortgage securities. Under the auspices of filling government’s mandate to  foster low-income and minority homeownership, Fannie and Freddie kept pushing highly risky mortgages.

Since HUD couldn’t do the regulating, this month Congress is expected to vote on putting Fannie and Freddie in another federal agency that can. Read Leoning here. MB

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