This crisis is not, as many lawmakers and media types have alleged, a failure of the free market. We haven't had a free market in the banking industry for years. Fannie Mae was created by the government in 1938 and Freddie Mac was created to compete with Fannie in 1970. Collectively, these two government-created firms control 90 percent of the secondary lending market. Through these institutions and acts of Congress, such as the Community Reinvestment Act, the government has pressured lenders into making risky loans to people who couldn't afford them, with an implicit guarantee that the government would back up these loans. Now that people are defaulting on their loans, home prices have depreciated, leaving banks with foreclosed properties that they can't sell and bad loans that no one wants to buy.

The way to fix this is with less government, not more. Repeal the Community Reinvestment Act, cut the government's ties to Fannie and Freddie, stop backing up bad loans, and let the private market run itself. Greed by itself is not a problem; it only becomes a problem when the federal government uses our tax dollars to reward those who make bad decisions.

Seth Farnsworth

Ogden