The administration is "loath to talk about drastic reform to the system until there's more evidence that the housing markets are not going to experience a severe double-dip," said David Min, associate director for financial markets policy at the Center for American Progress, a liberal think tank. "If you talk about drastic changes, you'll spook investors."
On Capitol Hill, however, Republicans are impatient. They argue that the government's push to expand homeownership through Fannie and Freddie was the main cause of the financial crisis. They are proposing to phase out Fannie and Freddie within four years.
"Something has to be done sooner rather than later, while there is some political will," said Rep. Scott Garrett, R.-N.J.
If lawmakers wait too long to tackle Fannie and Freddie, he said, "we will have forgotten the problems that they caused."
But powerful interests don't want to rock the boat too hard. The National Association of Realtors is pushing to preserve Fannie and Freddie, but as nonprofit government authorities without private shareholders.
"The disruption in the marketplace by doing something too radical would be harmful" to the housing market and the economy, said Vince Malta, a San Francisco Realtor who is testifying at Tuesday's hearing.