President Bush recommended a significant regulatory overhaul of the housing finance industry in 2003, but many Democrats opposed his plan, fearing that tighter regulation could greatly reduce financing for low-income housing, both low- and high-risk.[20] Bush opposed two other acts of legislation:[21][22] Senate Bill S. 190, the Federal Housing Enterprise Regulatory Reform Act of 2005, which was introduced in the Senate on January 26, 2005, sponsored by Senator Chuck Hagel and co-sponsored by Senators Elizabeth Dole and John Sununu. S. 190 was discussed in the Senate Banking Committee on July 28, 2005, with the result: "Ordered to be reported with an amendment in the nature of a substitute favorably", meaning the bill was reported out of committee, yet not voted on.

On May 23, 2006, the Fannie Mae and Freddie Mac regulator, the Office of Federal Housing Enterprise Oversight, issued the results of a 27 month long investigation.[23]

On May 25, 2006, Senator McCain joined as a co-sponsor to the Federal Housing Enterprise Regulatory Reform Act of 2005 (first put forward by Sen. Charles Hagel [R-NE])[24] where he pointed out that Fannie Mae and Freddie Mac's regulator reported that profits were "illusions deliberately and systematically created by the company's senior management".[25] However, this regulation too met with opposition from both Democrats and Republicans.[26]

Several Democrats who served as executives of Fannie Mae or Freddie Mac include Franklin Raines, former Budget Director for President Clinton and current Housing Policy advisor to Barack Obama, CEO from 1999 to 2004; James Johnson, former aide to Democratic Vice-President Walter Mondale and ex-head of Obama's Vice-Presidential Selection Committee, CEO from 1991 to 1998; and Jamie Gorelick, former Deputy Attorney General to President Clinton, and [6] from 1998 to 2003. In his position, Johnson earned an estimated $21 million; Raines earned an estimated $90 million; and Gorelick earned an estimated $26 million.[27] All three top executives were also involved in mortgage-related financial scandals.[28][29]

The top five recipients of campaign contributions from Freddie Mac and Fannie Mae during the 1989 - 2008 time period are Christopher Dodd, (D-CT) $133,900, John Kerry, (D-MA) $111,000, Barack Obama, (D-IL) $105,849, Hillary Clinton, (D-NY) $75,550, and Paul Kanjorski,(D-PA) $65,500.[30]. John McCain received $21,550 from these GSEs in the 19-year timeframe, 1989-2008, .[31] Freddie Mac also contributed $250,000 to the 2008 Republican National Convention in St. Paul, Minnesota according to FEC filings [32]. The organizers of the Democratic National Convention have not yet submitted their filings on how much they received from Freddie Mac and Fannie Mae (the latter of which tends more to support Democratic candidates).Yahoo! News No news stories that we are aware of have reported to total contributions of Fanny and Freddie to Democratic Committees. The top five recipients of campaign contributions from Freddie Mac and Fannie Mae during the 1989 - 2008 time period are Christopher Dodd, (D-CT) $133,900, John Kerry, (D-MA) $111,000, Barack Obama, (D-IL) $105,849, Hillary Clinton, (D-NY) $75,550, and Paul Kanjorski,(D-PA) $65,500