Fannie, Freddie, Fascist  Email Print   Ludwig von Mises had a
theory about interventionism. It doesn’t accomplish its stated
ends. Instead it distorts the market. That distortion cries out
for a fix. The fix can consist in pulling back and freeing the
market or taking further steps toward intervention. The State
nearly always chooses the latter course, unless forced to do
otherwise. The result is more distortion, leading eventually, by
small steps, toward ever more nationalization and its attendant
stagnation and bankruptcy.  When you think about the current
Fannie Mae-Freddie Mac crisis, you must remember Mises’s theory
of intervention. Reporters will not, but you must, provided you
want to understand what is going on. President Bush is
considering a fateful step in a 60-year-old problem: the
nationalization of these mortgage companies. He wants to
guarantee the $5 trillion (that’s trillion with a “t”) in debt
owned by these companies. Another option would be to put these
monstrosities under “conservatorshi