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House Panel Votes To End Fannie, Freddie Bonuses

RENEE MONTAGNE, HOST:

Lawmakers are cracking down on the big pay packages at Fannie Mae and Freddie Mac. Yesterday, the House Financial Services Committee approved legislation that would suspend almost $13 million in executive compensation at the two housing giants, and also pay executives there more like government workers. NPR's John Ydstie has more.

JOHN YDSTIE, BYLINE: Fannie and Freddie, which are currently under government control, got the biggest bailout of any firms during the financial crisis. So far taxpayers are on the hook for more than $150 billion. But filings by the firms show that top executives at Fannie and Freddie had pay packages worth nearly $100 million in the period since 2008. The House Financial Services Committee, in a bi-partisan vote of 52 to 4, approved legislation to end the big payouts and align employee pay at the firms with government pay scales. The legislation also would stop future bonuses. The Senate is expected to take up a similar measure in the near future. But in testimony before a Senate hearing yesterday, Edward DeMarco, head of the Federal Housing Finance Agency which regulates Fannie and Freddie, defended the pay packages. He argued competitive compensation is an important factor in attracting and retaining top talent at Fannie and Freddie. John Ydstie, NPR News, Washington. Transcript provided by NPR, Copyright NPR.

John Ydstie has covered the economy, Wall Street, and the Federal Reserve at NPR for nearly three decades. Over the years, NPR has also employed Ydstie's reporting skills to cover major stories like the aftermath of Sept. 11, Hurricane Katrina, the Jack Abramoff lobbying scandal, and the implementation of the Affordable Care Act. He was a lead reporter in NPR's coverage of the global financial crisis and the Great Recession, as well as the network's coverage of President Trump's economic policies. Ydstie has also been a guest host on the NPR news programs Morning Edition, All Things Considered, and Weekend Edition. Ydstie stepped back from full-time reporting in late 2018, but plans to continue to contribute to NPR through part-time assignments and work on special projects.