This morning’s papers are dominated by the government’s bailout of mortgage behemoths Fannie Mae and Freddie Mac. The New York Times’ Peter S. Goodman’s does a big-picture analysis: U.S. political leaders view their country as the beacon of free-market capitalism, but then again, so many of American’s biggest financial transactions are through the government-subsidized Fannie and Freddie.

In fact, since the mortgage crisis hit last year, about 2/3 of all new residential mortgages are from Fannie and Freddie. And most college loans are from the companies as well since commercial banks no longer deem these loans profitable.

Left unanswered is the motivation behind both major political parties entrusting so much of their exalted free market to these financiers on training wheels. Goodman suggests it may be due to the Bush administration’s desire to encourage minority home ownership. There is probably more at play than that.-MB

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