Clive Crook surveys the Fannie Mae and Freddie Mac mess:
Paulson hopes, of course, that he will not have to use the methods he is asking Congress to allow, and that merely requesting the option will be enough to calm the markets. We shall see. The problem with the Treasury's approach is that, even while asking for these powers, thus confirming that it cannot let the enterprises collapse, it insists that they must continue "in their current form". If the enterprises prove unable to finance themselves privately, then they cannot, by definition, continue in their current form. So on reflection I don't know whether the announcement is about the art of muddling through or the art of self-contradiction. Maybe both.