WASHINGTON In his zeal to overhaul regulation of Fannie Mae and Freddie Mac, Rep. Richard H. Baker, R-La., appears to be outrunning his likeliest supporters, including the vice chairman of his own subcommittee, and leaving himself and his bill susceptible to attacks by rivals.
That is no surprise to Rep. Baker, who, in unveiling the bill last week, said: This is very much a work in progress, and I am not going to make the claim that any other member of Congress wants to be associated with me at this time.
But fellow Republicans are not just keeping their distance; some have criticized the bills main premise, and at least one has gone on the attack and threatened the bills already-dicey prospects.
The proposal was virtually guaranteed to provoke controversy. Rep. Bakers bill would strip the Department of Housing and Urban Development of most of its power to regulate the two government-sponsored mortgage companies, a move that would include the elimination of the Office of Federal Housing Enterprise Oversight.
That authority would be transferred to the Federal Reserve Board, which reportedly neither requested the job nor helped draft the bill.
Rep. Marge Roukema, R-N.J., last week expressed serious concerns about the bill. In a press release, she said she wondered whether we are actually improving our ability to increase homeownership in America or crippling the mortgage market.
A spokesman for Rep. Roukema, who leads the House Financial Services panels housing and community opportunity subcommittee, said she has formally requested that she be allowed to conduct hearings on the bill, too.
My subcommittee has a direct and required jurisdiction in issues relating to housing, she said in a press release. Claiming that her panels oversight is not only warranted, but necessary, she questioned the wisdom of putting Fannie and Freddie under the Feds regulation.
This is not the first time that Rep. Baker and Rep. Roukema have been at odds. The two competed vigorously for the chairmanship of the former Banking Committee last year, before both were passed over in favor of Rep. Michael G. Oxley, R-Ohio, when the panel was reorganized as the Financial Services Committee.
But this is more than a case of internecine rivalry. Rep. Oxley and fellow Ohio Republican Rep. Bob Ney, the vice chairman of Rep. Bakers capital markets subcommittee, have expressed doubt about the proposed changes.
Last week Rep. Oxley said that though he supports the idea of a new regulator for Fannie and Freddie, the committee is nowhere near a consensus on who should regulate the companies. He also said that Rep. Baker should not expect a full committee vote on the legislation in the near future.
Rep. Ney would not comment on Monday, but a spokesman confirmed that he is concerned that the Fed may not be the ideal regulator for Fannie and Freddie.
Rep. Jim Leach, R-Iowa, an early co-sponsor of legislation to reform GSE oversight that Rep. Baker offered last year, has been silent on the issue. A spokesman said Monday that Rep. Leach has not had time to examine the bill or develop a position on it.
Of course, the Financial Services Committees Democrats have not been silent either.
Rep. Paul E. Kanjorski, D-Pa., the ranking Democrat on Rep. Bakers subcommittee, has blasted the proposal as a solution in search of a problem. And Rep. John J. LaFalce, D-N.Y., the highest-ranking Democrat on the committee, said last week that he believes the Baker bill would harm the GSEs and undermine efforts to make housing more affordable.
But long odds have not deterred Rep. Baker in the past. He had little support when he introduced sweeping legislation to reform GSE regulation last year, and though his bill did not pass, he was able to wrest a number of concessions from Fannie and Freddie last fall.
Observers say they expect Rep. Baker to turn to allies in the Senate, such as Banking Committee Chairman Phil Gramm, to help his cause. So far Sen. Gramm has been noncommittal on the issue, but the two conservative lawmakers have worked together in the past.
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