The Shakespearian tragedy of Fannie Mae

Bob’s book is full of information, but in addition, it represents an underlying drama—in fact, a Shakespearian tragedy in five acts:

                                     Rise, Power, Hubris, Fall, and Humiliation

On Power—many people in Washington and in the mortgage business were truly afraid of Fannie Mae and the retribution it meted out to those who crossed it.

On Hubris—Fannie often claimed it was the center of “the best housing finance system in the world” (a belief so instructively ironic in retrospect)—this echoed by former-Senator Dodd’s exclaiming that Fannie was “one of the great success stories of all time”!  So it was, until the Fall.

All five acts are very well chronicled in Bob’s book.

But which Shakespearian tragedy is this?

Thinking of the Fear of Fannie—perhaps it is Richard III, with Fannie as the ruthless Richard, brought down finally at Bosworth Field by Henry Paulson, playing Henry VII—

Or—thinking of then-Fannie CEO Dan Mudd, pathetically presenting financial plans to a Treasury Department which had already decided upon and was scheduling his fate—is it the great abdication scene, full of pathos, from Richard II?—with Dan Mudd playing the deposed king, handing over the crown to Henry IV, played by James Lockhart—

Maybe—but I think the best Shakespearian analogue is Julius Caesar, with the dictator of mortgage finance cut down in the capital city, with Henry Paulson this time playing Brutus.  I am thinking especially of the great scene where Marc Antony addresses the murdered body of Caesar.  Here we have Marc Antony played by Bob Hagerty, standing over the fallen Fannie:

          “Oh, might Fannie!  dost thou lie so low?”

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About the Author

 

Alex J.
Pollock
  • Alex J. Pollock is a resident fellow at the American Enterprise Institute (AEI), where he studies and writes about housing finance; government-sponsored enterprises, including Fannie Mae, Freddie Mac, and the Federal Home Loan Banks; retirement finance; and banking and central banks. He also works on corporate governance and accounting standards issues.


    Pollock has had a 35-year career in banking and was president and CEO of the Federal Home Loan Bank of Chicago for more than 12 years immediately before joining AEI. A prolific writer, he has written numerous articles on financial systems and is the author of the book “Boom and Bust: Financial Cycles and Human Prosperity” (AEI Press, 2011). He has also created a one-page mortgage form to help borrowers understand their mortgage obligations.


    The lead director of CME Group, Pollock is also a director of the Great Lakes Higher Education Corporation and the chairman of the board of the Great Books Foundation. He is a past president of the International Union for Housing Finance.


    He has an M.P.A. in international relations from Princeton University, an M.A. in philosophy from the University of Chicago, and a B.A. from Williams College.


  • Phone: 202.862.7190
    Email: apollock@aei.org
  • Assistant Info

    Name: Emily Rapp
    Phone: (202) 419-5212
    Email: emily.rapp@aei.org

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