Friday, September 12, 2008

Politics and Rent Seeking Behavior

Why was there not more regulation of Fannie Mae and Freddie Mac in spite of many efforts? Rent seeking.

From the Washington Post:

Sen. Christopher Dodd, the Democratic chairman of the Senate Banking Committee, has the gall to ask in a Bloomberg Television interview: "I have a lot of questions about where was the administration over the last eight years"... Meanwhile, Dodd -- who along with Democratic Sens. John Kerry, Barack Obama and Hillary Clinton were the top four recipients of Fannie and Freddie campaign contributions from 1988 to 2008 -- actively opposed such measures and further weakened existing regulation.

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