US rescue of Fannie, Freddie poses taxpayer risks

By TOM RAUM

WASHINGTON (AP) — President Bush's "ownership society" was never supposed to come to this.

With the government takeover of Fannie Mae and Freddie Mac, U.S. taxpayers now essentially own the bulk of the nation's mortgage market.

This ownership could even lead to a big increase in the national debt — to $15 trillion, up from just under $10 trillion now — if things don't work out as planned.

The government's forced rescue of the mortgage finance giants over the weekend could have many unintended consequences, even though those in both parties — including the presidential nominees, Republican John McCain and Democrat Barack Obama — have greeted it as a necessary evil toward easing the nation's housing and credit woes.

If all goes as planned, it should help make home loans cheaper and more readily available. It also may slow the rate of foreclosures and possibly halt house price depreciation. But that's a big maybe.

US rescue of Fannie, Freddie poses taxpayer risks....