WASHINGTON — Republicans on the House Financial Services Committee are recommending that the special congressional committee charged with reducing the deficit by $1.5 trillion look to Fannie Mae and Freddie Mac.
In a letter sent Friday, Chairman Spencer Bachus and 20 of his 33 Republican colleagues on the committee call for consideration of a hike in the guarantee fees that Fannie and Freddie charge lenders. The letter does not specify how much higher the fees should be, but it does suggest that the Obama administration's proposal to raise them by one-tenth of 1% does not go far enough.
The Dodd-Frank Act also comes under fire in the letter. Bachus and his GOP colleagues call the 2010 financial-reform law the "most significant impediment to economic growth that falls within the Financial Services Committee's jurisdiction." They urge the 12-member deficit-reduction committee to review numerous Republican-sponsored bills to repeal or amend parts of Dodd-Frank.
Additionally, the Republicans recommend finding savings in the budgets of certain programs run by the Department of Housing and Urban Development. And they urge the deficit-reduction committee, also known as the supercommittee, to consider ending spending on two housing programs funded by the Troubled Asset Relief Program, including the Obama administration's flagship loan modification program.
Elsewhere in the letter, the Republicans call for the 12-member deficit-reduction committee to consider a number of proposals that they say would spur economic growth and thereby boost tax revenue. One of those measures is a bipartisan bill that would raise the threshold for the number of investors in small banks that triggers a registration requirement with the Securities and Exchange Commission.
Earlier in the week, Rep. Barney Frank, the top Democrat on the Financial Services Committee, sent his own letter to the deficit-reduction committee. He recommended the adoption of a risk-based fee on banks, insurance companies and securities firms with more than $50 billion in assets, and on hedge funds with more than $10 billion in assets, among other measures.
Friday was the deadline for a variety of congressional committees to make recommendations to the super-committee.
The Senate Banking Committee did not submit written recommendations, but has provided input in numerous meetings, according to spokesman Sean Oblack.
