The logos for Freddie Mac and Fannie Mae
The logos for Freddie Mac and Fannie Mae - 
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Kai Ryssdal: Talking about spending is a handy way to get into our next story. One of the most costly -- and lasting -- effects of the housing collapse and financial crisis for taxpayers remains the $138 billion worth of bad mortgages backed by Fannie Mae and Freddie Mac, the two mortgage companies that were taken over by the government just as the crisis got going.

Congress has been looking for a way to replace 'em for years. They gave it their latest shot today -- with bipartisan support. Marketplace's John Dimsdale reports.

John Dimsdale: Most members of Congress believe the fragile housing market needs some sort of government mortgage guarantee. That's the only way to keep interest rates and down payments affordable.

John Campbell: If you don't have some government backstop or some government support, the 30-year fixed-rate mortgage will go away.

That's California Republican John Campbell, who along with Michigan Democrat Gary Peters today introduced a bill to replace Fannie and Freddie with five smaller, private companies. They would be chartered by the government to issue mortgage-backed securities with a taxpayer guarantee.

Campbell: Without some government support like this, you can't get the marketplace to loan that much money for that long a period of time.

The replacements for Fannie and Freddie would have to buy insurance on the mortgages and set aside more capital to cover bad loans. And co-sponsor Gary Peters says the guaranteed mortgages would require a higher down payment, probably around 20 percent.

Gary Peters: This legislation puts significant protections in place by putting a lot of capital ahead of any government guarantees.

Even so, Peter Wallison at the American Enterprise Institute says taxpayers will still be on the hook.

Peter Wallison: When you think about it, the buyers of those securities do not care whether those mortgages are of any value. And why should they care, because the government is going to back them if ultimately those mortgages fail, which is exactly what happened with Fannie and Freddie.

Even though today's bill is a rare bipartisan effort, it gets in line behind a long list of congressional priorities.

In Washington, I'm John Dimsdale for Marketplace.