Over the weekend, the United States government tried to correct one mistake with another: Under intense pressure from foreign governments – especially the Chinese government who are the single largest investor in Fannie Mae and Freddie Mac – Uncle Sam took out its checkbook. With a flourish of the pen, the Treasury nationalized these failing financial behemoths. In the process, it wiped out any remaining common shareholder value, eliminated stockholder control over the company’s operations and fired (but will still pay millions in golden parachutes) one of the most inept management teams in the history of any undertaking. In yet another stunning example of crisis management, lack of planning, and most of all – lack of leadership control of an organization – a pillar of both the real estate industry and the global economy itself crumbled. If the situation sounds a little too familiar to you, perhaps you’re wondering: Where’s my government bailout?

Real estate professionals should be upset today. A terrible blow for the integrity of the real estate industry – for housing as a foundation of personal equity and wealth, for the rule of law in mortgage lending, for simply doing good for ordinary Americans – has just been dealt by the government. A so-called “great compromise” has just laid $300 billion – financed by Fannie Mae and Freddie Mac – in bad debt at the footstep of the taxpayer. According to the Wall Street Journal: The legislation combines the regulatory reforms for government-sponsored enterprises Fannie Mae and Freddie Mac with a proposal to use the Federal Housing Administration to offer up to $300 billion in federal guarantees to help refinance struggling borrowers into new mortgage loans. One compromise proposal discussed last week would use the money from an affordable housing fund created from Fannie Mae’s and Freddie Mac’s earnings to help pay for the FHA guarantee program.