Fannie Mae and Freddie Mac Take on the Free Market

fannie mae office
Michael Hoffman | United States

The privatization of Fannie Mae and Freddie Mac seems to be on the U.S. Treasury and Trump administration’s agenda, and with everyone predicting that a recession is on the horizon, it’s starting to feel like 2008 again.

From the Austrian perspective, allowing the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation to revert back to quasi-market-based institutions is optimal because it will open up competition and more realistic price discovery in terms of home financing and real estate prices (though not as much as we’d like to see).

With over 50 proposals to overhaul the real estate market, including a “smaller” role in the housing market for the Federal Housing Administration (FHA), the plan seeks to aid those who want to see housing become more affordable. Sounds good right? Not so fast. As the proverbial saying goes, be sure to read the fine print, since no one will be more affected by these potential political and economic changes than prospective American homeowners.

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If You Want to Save the Amazon Rainforest, Privatize It

amazon rainforest privatize
Derrell McIver | @BenjaminDMyles1

The Amazon rainforest is one of the most beautiful and essential natural features on our planet. Yet, it is now in great danger as fires, raging for many weeks, threaten the “lungs” of Earth. We should be worried about the Amazon rainforest. But calls for the government to act are not the answer. If they give up ownership and privatize it, governments will provide the best way for the Amazon and other threatened natural resources to be saved. By doing so, they will introduce a beneficial profit motive. 

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Privatizing the Oceans Could End Environmental Destruction

Privatizing the world's oceans would end environmental destruction tragedy of the commons
Indri Schaelicke | @ISchaelicke

The year is 2031. A year has passed since the UN’s deadline to save the earth from irreversible climate change was reached. Oily, sticky, pungent air sits clumped motionless in heavy clouds just 10 feet off the ground. Skyscrapers pierce through the dark heavens and continue on into nothingness. They extend infinitely into black holes of sky, only to be lost by the human eye in a sea of polluted air.

Meanwhile, all sorts of sea life are being harmed by immense islands of garbage floating aimlessly in the oceans. Death tolls of fish, birds, turtles, and sea lion are a daily scene on the news. Garbage disposal companies blatantly dump millions of pounds of trash into the oceans each day, and no one is forced to atone for their environmental sins. This is the tragedy of the commons. How do we solve it? By privatizing the oceans.

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Privatize Social Security

privatize social security
Garrett Summers | United States

The Federal government’s spending is out of control. The current US debt is $22 trillion and every year we add about another $1 trillion. Shrinking the size of the federal government means shrinking its power. Money is power, so decreasing the amount of money and economy the government controls should be the first place to start. Social Security is the number one expenditure of the federal government. Every year, about $1 trillion dollars of the budget goes towards Social Security. Privatizing Social Security would nearly remove the annual deficit. It would also return the power and responsibility of the individual to manage their own retirement.

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