No surprise at the latest news from Bush's politicized Treasury Departmant.  It's the typical flawed, make the situation worse Bushite MO.

 

Create a new regulatory agency whose head, appointed by the president and approved by Congress, has less power than current bank regulators. For an administration that has been trying to kill government of, by and for the people, it sure believes in using bureaucratic smoke and mirrors as a cover for its role in the mortgage catastrophe rather than applying existing regulatory laws or strengthening those laws to hold those accountable for perpetrating the crisis.

 

As the NYTimes reports: "Under the measure, Congress would lose some of its authority to oversee the companies, Fannie Mae and Freddie Mac, including the right to determine how much capital they must keep as a cushion against losses. That role would shift to the new regulator, which would be called the Federal Housing Finance Agency; the director of the agency would be appointed by the president and confirmed by the Senate.

"While experts on the companies agree that the proposed regulator would be stronger than the existing one, housed in the Department of Housing and Urban Development, some contend that the legislation does not go far enough.

"These critics say that the measure tilts in favor of the companies, even as it tries to strike a balance between promoting affordable housing a primary mission of the government-sponsored mortgage giants and setting limits on them to diminish the risks they pose to the world financial system. A new regulator, they say, would have significant new powers, but still less than bank regulators now have.

"As a result, the companies, which have a reputation for retaining some of the most influential lobbyists in Washington, could continue to exploit those weaknesses to their advantage, these people say, potentially encouraging them to take on more risks that could ultimately require a taxpayer bailout.

'The new law will not give the regulator either the mandate or the capacity of a bank regulator,' said Thomas H. Stanton, an authority on the companies who has written several books on them. 'The new law creates a cumbersome regulatory process to implement many parts of the bill,' he said, adding, 'I'm afraid we will need to revisit the issue of the proper regulatory framework for the companies.'

"Even Mr. Paulson, in a television interview on Sunday, conceded that tougher regulation was secondary to reassuring the financial markets of the fiscal health of Fannie and Freddie, which provide financing for roughly 80 percent of all new home loans in the country."

Leave it to the Bush regime to obfuscate a problem amd cover up its complicity in the mortgage debacle by creating even more problems.