Richard H. Davis, the former national campaign manager for Republican presidential candidate John McCain, is putting his skills to work for Fannie Mae.
Mr. Davis, a managing partner at Davis Manafort, an Alexandria, Va., consulting firm, said in an interview Monday that the group he is organizing would be "a very broad-based coalition focusing on housing and housing finance issues." Fannie Mae is the only coalition participant he would name.
Mr. Davis said that countering FM Watch, the lobbying group formed last year to limit Fannie and Freddie's growth, will be "one element of the education campaign that's going to be waged." He was quick to add that the coalition would not be a lobbying organization but rather would focus on "public education."
He said the coalition will "focus on the fact that our system of housing and housing finance is the best in the world and we want to preserve it." For example, he said, the group will advocate preserving the mortgage interest payment tax deduction.
That position - unlike some of the other elements of the job Mr. Davis is undertaking - is hardly going to meet much political opposition on Capitol Hill, where Fannie and Freddie otherwise have been on the hot seat. A bill sponsored by Rep. Richard H. Baker, R.-La., which would tighten regulation of the two mortgage giants, though deemed unlikely to pass this year, has attracted media attention.
Treasury undersecretary Gary Gensler in March said he would support eliminating the companies' credit lines, and Federal Reserve chairman Alan Greenspan in May said it would be appropriate to review their "subsidies."
Two weeks ago FM Watch took several top financial services executives on a tour of Washington to meet with key policymakers on issues concerning the government-sponsored enterprises.
The political uncertainty has weighed on Fannie and Freddie's stock prices and borrowing costs.
Mr. Davis, whose prior credits include a role as debate coordinator for the 1988 Bush-Quayle presidential campaign, said his group's agenda will "not in any way be limited to what FM Watch has been doing."
"This an obvious response to the criticism that Fannie Mae has been receiving from Congress and its regulators over the past year," said Mike House, executive director of FM Watch, through a spokeswoman.
Katherine Doddridge, vice president for legislative affairs at the National Association of Home Builders, said the trade group "would be favorably disposed" to joining Mr. Davis' coalition but has not done so yet. "We're considering it," she said.
Sharon McHale, a spokeswoman for Freddie Mac, said her company has also been approached. "We are supportive of what the coalition says it's about," she said. "We're certainly very amenable to doing it, but nothing has been finalized yet."
It would not be surprising to see the home builders and Realtors join a coalition to preserve the two mortgage buyers' government-conferred benefits. In hearings before a House Banking subcommittee last week, representatives of the trade groups said they oppose repealing the GSEs' emergency credit lines with the Treasury.
