A behind-the-scenes effort of Wall Street banks to take over the mortgage market is driven by advocates who switch between roles in Washington and the private sector.
New York Times staffer Gretchen Morgenson unleashes a fireworks display of technical grasp and cops-reporter curiosity in looking at the "revolving door" churning officials into Federal finance agency positions from the private sector and back again, all as mega banks seek to remove the Government Sponsored Enterprises from their access to greater profits in the U.S. mortgage industry's secondary markets. Morgenson writes:
While the big banks’ effort to enshrine their vision into law has failed so far, plans to replace Fannie and Freddie — which have long supported the housing market by playing a unique role as so-called government-sponsored enterprises, or G.S.E.s — are still very much alive. The Obama administration has largely embraced the idea, and government regulators are being pushed to put crucial elements into effect.A review of lobbying records, legal filings, and internal emails and memorandums, as well as housing officials’ calendars and White House and Treasury visitor logs, illuminates the banks’ effort. Assisting in this work, the documents show, is a group of high-level housing finance specialists who have moved back and forth between public service and private practice in recent years.