Barney Frank Lives! (And Is Still Costing You Money)

In the middle of the sub-prime housing crisis, Fannie Mae and Freddie Mac were losing tens of billions of dollars hand over fist, causing significant embarrassment and crimping the soviet wing of the Democratic Party's ability to control the housing market.  So what the central planners in DC did was quietly shift their massive subsidy machine to another agency, the Federal Housing Administration away from the dead men walking GSAs.

Well, we're a couple years removed from that sly move, and the predictable results are rolling in.  Whaddaya know, the FHA is going to need to raid the US Treasury.

The Federal Housing Administration will take a taxpayer subsidy for the first time in its 79-year history after efforts to improve its bottom line failed to offset losses on loans it backed during the housing bubble, according to three people familiar with the matter.

The government mortgage insurer will draw the money from the U.S. Treasury to shore up its insurance fund by Sept. 30, the end of the current fiscal year, said the people who asked not to be identified because the action hasn’t been announced.

Federal budget officials are working to determine the exact size of the cash infusion, the people said. White House budget officials projected in April that the FHA would need about $1 billion. The agency, which is required to keep enough money on hand to cover projected future losses, has authority to take the money without prior approval from Congress.

Here is as easy a prediction as I'll ever make.  It won't be a $1 billion, it'll be way north of that.  And it won't be the last time.