Testimony by Anthony Sanders, a professor of real estate financeatGeorge Mason University, though, took another tact. He noted thatthefederal debt already stands at $8 trillion and the Fannie Mae,Freddie Mac and Federal Home Loan Bank debt stands at $8 trillionas well. "This combined debt load for theUS is $16 trillion andrepresents 110% of our gross domesticproduct," he said. "This'Grecian Formula' of debt issuance to fundhousing goals is notsustainable. We simply have too much leverage inthe housing financesystem."

There are affordable housing missions at HUD; Fannie andFreddie; financial institutions--through the Community ReinvestmentAct; andother federal, state and local programs, Sanders said."Given themassive supply of vacant housing on the market, theshadow inventoryof foreclosed houses at financial institutions andmultifamilyvacancy rates, perhaps it is high time that weconsolidate theaffordable housing missions under one tent."

HUD is the ideal choice, as the nation's affordable housingmission has typically been housed there. At the same time, Sanderssaid, the FHA, "our low-to-moderate income mortgage insuranceentity, is woefully antiquated in terms of technology and is indesperate need of modernization. Thus my first recommendation is adramatic overhaul and modernization of the FHA."