“This is the fourth in an 11-part series on the failed promises of the Dodd-Frank financial reform package and the continued, dangerous imbalances in our financial system.

“Fannie Mae (the Federal National Mortgage Corporation) and Freddie Mac (the Federal Home Loan Mortgage Corporation) were definitely players in the financial crisis. No one disputes that, but there are very different, usually partisan opinions about how much they contributed to the crisis and how to fix them. That’s no doubt why they aren’t mentioned in Dodd-Frank. The political divide on them might well have torpedoed the entire bill.

“I’ll quote from both the majority and minority FCIC reports to frame the Fannie Mae-Freddie Mac problem. The majority report said, “These GSEs [Washington-speak for Government Sponsored Enterprises] had a deeply flawed business model as publicly traded corporations with the implicit backing of and subsidies from the federal government and with a public mission. Their $5 trillion mortgage exposure and market position were significant. In 2005 and 2006, they decided to ramp up their purchase and guarantee of risky mortgages, just as the housing market was peaking…”

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Read Ted Kaufman’s full Forbes op ed here