In the latest Financial Services Outlook, American Enterprise Institute (AEI) housing experts Peter Wallison and Edward Pinto explain how decades of government intervention have gravely harmed America's housing market.

As policymakers continue their efforts to reduce the government’s role in the currently nationalized housing market, the broadly available and deep subsidies provided to the five divisions of the Government Mortgage Complex continue to distort the marketplace and thwart these efforts.

Though its capital position improved slightly over last month, the FHA is still firmly in the red, with a current net worth of –$13.45 billion. Particularly alarming is the growth of the Ginnie/USDA division, which has a higher default rate than the FHA.

Super committee members Sen. Pat Toomey and Rep. Jeb Hensarling are taking flak from some conservatives for proposing a deal including increases in "revenues." But it's worth taking a look at what Toomey and Hensarling actually were talking about. It may not matter now but could after 2012.

Are Fannie Mae and Freddie Mac a mechanism--and an inefficient one at that--for transferring a subsidy from all taxpayers to homeowners?

Fannie Mae and Freddie Mac channel billions of dollars into the housing market by buying mortgages and guaranteeing mortgage-backed securities. Because these two institutions are perceived as government-supported, they are able to borrow in the credit markets at a much lower rate than others and provide lower...

Loans that have been labeled predatory reveal the dark side of subprime lending.

In less than twenty-five years, government “affordable housing” and other housing policies have turned a healthy market into a financial ruin. Until Fannie and Freddie’s market dominance and the government’s role in the housing finance system are substantially reduced or eliminated, the United States will continue to have an inferior and unstable housing market.