In a world of outrages in Bidenomics, big government socialism, tax success, destroy a whole industry through un-elected regulatory bureaucrats, where diversity, equity and inclusion and redistribution reign over incentives to promote opportunity and growth, we have a new outrage.   

Hardworking folks, and I’m talking typical middle-class blue-collar type families, who play by the rules and save their money to create a nest egg to buy a house (i.e. the American dream) they’re going to be penalized by the Biden administration.   

It is another example of Biden’s war on success. The administration is going to hike payments for good-credit homebuyers in order to subsidize high risk mortgages. That’s right!   

New federal rules from the Federal Housing Finance Agency, which is Fannie Mae and Freddie Mac, which control 60% of the housing mortgage market, go into place May 1. If you have improved your credit score to 680 or higher, or if you have made a down payment of 15-20%, you will be penalized with a higher mortgage interest rates and new large fees on the transaction.   


U.S. President Joe Biden travels to Ohio

U.S. President Joe Biden speaks on rebuilding American manufacturing through the CHIPS and Science Act at the groundbreaking of the new Intel semiconductor manufacturing facility in New Albany, Ohio, Sept. 9, 2022.  (Reuters/Joshua Roberts / Reuters Photos)

This is an outrage. This is an attack on the American dream. Everybody should try to put 20% down. It’s a commitment to the future. It’s a matter of financial responsibility. It should not be penalized. It should be rewarded and if you’re recovering from COVID, or even going way back if you’re recovering from the financial meltdown of 2008 and 2009, and you got your FICO credit score up to 680 or nearly 700, you should be rewarded for your effort.   

What Biden is doing is creating a responsibility tax. Again, he is attacking middle-class people who played by the rules, worked hard, who saved to invest in a home, really the most cherished aspect of American life, your own home.   

The other side of the coin is that people who have not achieved a good down payment or a good credit score will be rewarded with lower mortgage rates and fees. Look, everybody wants as many people as possible to own a home to share in the American dream, but this is not the way to do it.   

Fannie Mae and Freddie Mac had to be bailed out by taxpayers fifteen years ago to the tune of $191 billion. Why?  Because these government-backed agencies put their seal of approval and government backing behind mortgages for people who could not carry the mortgage financially and when interest rates went up then, just like they’ve gone up now, it made matters worse for people who either had no equity in their home or maybe 5%, did not have steady incomes, or a savings nest egg.   

They defaulted on their mortgages, which caused Fannie and Freddie to lose money and eventually to go bankrupt.  Why in the world would any administration repeat those mistakes? Why?  Let me reiterate: Fannie and Freddie had a $191 billion taxpayer bailout.  Do we seriously believe we want to repeat that?  Or, why put a burden on families who can’t afford it? It is not good for them. 

Government subsidies are no substitute for a savings nest egg and a surefire income statement history. This is left-wing socialist ideology; that’s all it is. Former Federal Housing Finance chief Mark Calabria who served with me under President Trump will join us on all this in just a bit, but this is the socialist fashion that we see everywhere we look.   

Not just Joe Biden or his alter-ego Bernie Sanders, but look around the whole G7. I don’t see one single proponent of economic growth and prosperity, but I do see a whole bunch of left-wingers who are trying to substitute government action for private investment and are, of course, failing.   


There is no growth right now among the G7, but there is a lot of inflation because of all this government action. We should be outraged at this mortgage story, but we should be equally outraged at how all these governments are going in the wrong direction. 

Where are the capitalists?  Save America. Cut the budget. Grow the economy. Wait for the grownups to return.   

This article is adapted from Larry Kudlow’s opening commentary on the April  20, 2023, edition of “Kudlow.”