Congressional wrangling over fiscal issues looms large in shaping the eventual endgame solution for Fannie Mae and Freddie Mac, and it does not bode well for reform this year. 

That’s a shame. With both government-sponsored enterprises turning a profit and the housing market showing signs of recovery, this would be the perfect time to finally address what to do with these housing agencies – were it not for the political realities. Alas, the ever-widening ideological split over government’s role in markets, and the absence of political will to tackle this issue (unlike, say, gun control) will likely result in a continued stalemate on GSEs.