Fannie Mae and Freddie Mac are the leading sources of mortgage funding in the United States and, quite frankly, will ultimately profit the most from the Hurricane Katrina tragedy which caused over one million people to become homeless. Because these two corporations buy mortgages from lenders that follow their guidelines, both Fannie and Freddie borrow trillions of dollars cheaply.
Freddie Mac gave $10,000,000 towards the effort to help stabilize the lives of the victims devastated by Hurricane Katrina. But Fannie Mae's generosity towards this primarily poor and African American group of victims is a meager $1,000,000; this amounts to less than $1.00 a piece. But, maybe Fannie Mae doesn't care about Black people. Perhaps their pattern of giving doesn't warrant this conclusion. You decide.
Taking a look at Fannie's track record on giving, as well as the programs and partnerships it forms, we find that the 9/11 tragedy, which hit right in the heart of the Wall Street financial hub of New York, motivated Fannie to donate $5 million. This year, Fannie gave $1 million to the Congressional Hispanic Caucus. Fannie donated $1 million to the National American Indian Housing Council. Further, Fannie Mae has pledged $1.25 billion over the next 10 years to assist Indian housing. Also to note is Fannie Mae's "House Orange County" investment plan implemented out of its partnership office in California. This was a five-year, $6 billion effort by the company to help 60,000 financially well-off Orange County families obtain affordable housing. This generous offer was extended to first-time home buying educators whose incomes were no MORE than 120% of the area's median income. At the time, the median income for a family of 3 was $98,897.
Fannie is a company that spends millions of dollars each year in radio and print advertisements, boasts of its annual sponsorship to 'Help-The-Homeless' and earns over $1,000,000 a day. Fannie ought to put its money where its mouth is!
Instead of actually helping the homeless, Fannie has consistently helped only itself -- looking after its own public image, buying more and more political power and snowing its stockholders. Through its charitable organization, the Fannie Mae Foundation, Fannie gave $34.8 million in grants to other organizations whose stated mission was to empower folks by helping them purchase homes. But upon closer scrutiny, in the same year that $34.8 was granted, Fannie spent $44 million on television and radio ads to tell people about it.
Hurricane Katrina has been reported as the most devastating disaster in the U.S. and has caused the largest number of victims by a single event in U.S. history. A company that sponsors an annual Help the Homeless charity should put a lot more money towards an effort to help such a large group of instantly homeless people to become stable.
Perhaps they cannot afford to donate to the suffering Blacks hit by Hurricane Katrina after last year’s payments of $15-million to ex-CEO Frank Raines and, several years prior, a $27-million severance package to his predecessor. Fannie made at least $2,000,000 in campaign contributions in the past few elections, putting them just after Microsoft in the list of top ten corporate donors of 'soft money'.
Granted, Fannie Mae's disaster relief provisions will help borrowers by suspending mortgage payments for up to three months. But, this assistance is provided on a case-by-case basis with decisions made based on the victim's uninsured losses, extended unemployment and extraordinary expenses related to the storm that affect a homeowner's ability to make the mortgage payment.
Copyright 2005 - AskBlax
This article was posted on September 16, 2005
