Barney Frank: “I unfortunately have to again correct the ranking member. There was no money for affordable housing construction of any…”

“I unfortunately have to again correct the ranking member. There was no money for affordable housing construction of any significance for Katrina affected areas. The gentleman from Alabama incorrectly stated that we already voted $3 billion for Katrina. In the bill that we passed for the hurricane, there was one proposal for project-based section 8 that could help build 4,500 units. There was no other money in that bill for housing construction. Members will go back and read the debate, and they will see it was always contemplated by those of us for the bill that would be accompanied by this bill. The assertion that this duplicates money voted for housing construction in Katrina has zero accuracy. This was always contemplated to be the second bill. Additionally, the gentleman said I said the money wouldn't come from anywhere. No, quite to the contrary. I said several times in this hearing that it would come from the shareholders. I do not believe that Fannie and Freddie have monopoly pricing power that allows them simply to pass along every cost. Beyond that, I did note know that there were other positions being taken that would reduce the portfolio of Fannie and Freddie that would have far more impact on the profitability than the housing fund. So those who believe that when you impact Fannie and Freddie's profitability you raise the cost of mortgages, they should not be for any other reductions in the housing fund.”