Brad DeLong orders me to support the Frank-Dodd bill to guarantee mortgages through the FHA.
He modestly neglects to mention that, last week, he told The Dodd and Frank to do this
If I were working for the Treasury right now, I would be saying: make this happen on Monday. There isn't time to set up a new bureaucrtacy--a HOLC, which is what Alan Blinder wanted to do as of three weeks ago. So use an existing bureaucracy: Fannie Mae. If I were Treasury Secretary Hank Paulson, I would spend the weekend building a legislative vehicle to introduce Monday morning on an emergency basis to give Fannie Mae the resources and the mission to undertake this mortgage rescue operation, and I think Fannie Mae is the right institution for the task: why does it have its government-sponsored status and guarantee if not to be used for purposes like these at times like these?
OK OK technically he told Hank Paulson to do this, but we know that was a rhetorical device. Saying the Bush administration should lead is like saying pigs should fly -- a sign of desperation not a proposal.