In Washington no bad idea stays dead long. Therefore it should not be surprising that U.S. President Donald Trump is planning to move forward with plans to privatize Fannie Mae and Freddie Mac, the mortgage giants that have been in government conservatorship for almost two decades.

As with many of the moves undertaken by Trump, it is not clear what problem this is meant to solve. For the period they have been in conservatorship, Fannie and Freddie have been securitizing mortgages at a low cost and have not faced any substantial management problems.

There is of course one problem that privatizing Fannie and Freddie would solve. This is yet one more way that the financial industry can run up some profits and high pay for top executives at the expense of the rest of us.

The Congressional Budget Office calculated that having private institutions, rather than Fannie and Freddie in their current form, would add roughly 20 basis points, 0.2% to the cost of securitizing mortgages. With around $1 trillion in mortgages being securitized each year, that comes to $2 billion annually. That is not huge in the context of the federal budget (0.03%), but it is four times the annual appropriation for the Corporation for Public Broadcasting that got Trump so upset.

Trump is giving a green light to his finance buddies to find every more creative ways to rip off businesses and ordinary people.

And in the case of privatizing Fannie and Freddie, we literally get nothing for it except a less efficient mechanism for securitizing mortgages. This is similar to the plans for privatizing Social Security. We have an extremely efficient public system, but many people in the Trump........

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