Nov. 10, 2011
By Craig Chval Sr.
As the nation continued to struggle with its biggest housing crisis in decades, The Washington Post this summer considered a number of candidates for the unofficial title of most powerful man in housing policy – President Obama, Treasury Secretary Timothy Geithner, House Financial Services Chairman Spencer Bachus (R-Ala.).
But The Post concluded that all three take a back seat to the Acting Director of the Federal Housing Finance Agency (FHFA), Edward DeMarco, describing the 1982 Notre Dame graduate as “a little known bureaucrat.”
As The Post’s profile of DeMarco made crystal clear, however, DeMarco is anything but little known at the highest levels of government. After more than 20 years of government service, DeMarco joined the FHFA when it was created by Congress in 2008, serving initially as its Chief Operating Officer and Senior Deputy Director.
Six weeks after the agency was created, it placed Fannie Mae and Freddie Mac into conservatorship – in essence putting the two government sponsored entities under the supervision of the FHFA. Combined, the two companies own or insure over five trillion dollars in mortgages. Following the resignation of the Agency’s original director James Lockhart, DeMarco was designated as Acting Director by President Barack Obama in August 2009.
“Nobody had ever done something like this before,” says DeMarco of the conservatorship of Fannie and Freddie. “It’s meant to be a temporary action, but we’ve been at it for over three years.”
The FHFA has delegated back to Fannie and Freddie responsibility for their day-to-day operations, but continues to be ultimately responsible for everything that goes on at the agencies.
“As conservator, we stand in the shoes of the shareholders and the boards of directors,” DeMarco explains. “We’re responsible for making sure that the companies are returned to a financially secure position, that we conserve and preserve their assets and that there’s not a dissipation of assets while in conservatorship.”
Some involved with the housing industry have articulated policy ideas they would like to see Fannie and Freddie implement, in the belief that the initiatives would hasten the recovery of the U.S. housing industry and the national economy. DeMarco, however, doesn’t see that as part of his charge as FHFA’s director.
“People can say that we wish you would do this and that, and the answer is, `That’s nice, but …'” says DeMarco. “If Congress wishes taxpayer support to be provided to do other good deeds, we will do that as soon as Congress appropriates the money, but we’re not going to put ourselves in the shoes of elected lawmakers. We’re going to carry out our responsibility as conservator within the legal framework that we operate.”
With so many divergent ideas about such critically-important issues, it’s quite likely a good sign that DeMarco often finds himself in disagreement with politicians on both sides of the aisle — and an even better sign that DeMarco is unmoved by political considerations.
In commending him for standing firm against political pressure, the Chicago Tribune called DeMarco “an unsung hero.”
“He is the most ethical, principled person I know,” says Michael Ortman. And Ortman ought to know, as he first met DeMarco in 1978 at a gathering for incoming freshman sponsored by the Washington DC Notre Dame Club. The two shared an apartment in Maryland after their graduation from Notre Dame, and Ortman later married DeMarco’s sister.
“He is beyond reproach and he is brilliant,” says Ortman.
I’ve often thought that 16 years of Catholic education taught me a few things about justice and truthfulness and ethics and rules,” DeMarco offers.
For many in the DeMarco family, a big part of Catholic education involves Notre Dame. Three of DeMarco’s brothers earned undergraduate degrees from Notre Dame, with one also receiving a law degree. Along with his sister, two of DeMarco’s brothers married Notre Dame graduates. As the eldest of six siblings, DeMarco was the first to attend Notre Dame.
“My passion for Notre Dame goes back to when I was a young kid and first starting to watch football games and being a good Catholic boy growing up outside of Boston, you quickly got familiar with Notre Dame,” relates DeMarco. “I was just like many boys my age – that became something I was very focused on.”
After moving from Massachusetts to California, DeMarco’s family was relocating to Virginia, when the family made a stop at Notre Dame.
“It was a memorable experience, and I can remember talking to my parents about applying to Notre Dame,” says DeMarco. “Certainly, it was a dream come true to get accepted to Notre Dame.”
While pursuing his doctorate in economics from the University of Maryland, DeMarco earned a doctoral research fellowship from the General Accounting Office, giving birth to a career in public service that is approaching three decades.
“There are some very challenging issues that really matter to the whole country and being in public service affords an opportunity to play a meaningful role in helping support our great country,” says DeMarco of his decision to devote his entire career to the public sector.
“I’ve seen a great deal of personal sacrifice on the part of people at this agency as well as other agencies over the past several years,” observes DeMarco. “And I mean that in terms of both the Bush Administration and the Obama Administration trying to respond effectively and appropriately to this time of disruption.
“We all wish that the resolutions would have come faster, and with less pain,” he says.
DeMarco and his wife, Garland, have four children, and DeMarco is very mindful of the toll the demands the housing and economic crises have taken upon them.
“My family has given up a lot for me to be able to do this,” he acknowledges.
One of the few diversions DeMarco allows himself is participation in a family fantasy football league. Once upon a time, DeMarco was the scourge of the league, but there simply aren’t enough hours in the day for him to stay on top of the latest NFL developments.
“His team used to be real good,” says his nephew, Patrick Ortman. “But we all should be glad that his team stinks now. He’s too busy trying to fix the housing mess.”
As for today’s game, DeMarco hopes that his schedule allows him to attend the battle between his two alma maters. And while he makes it clear that he has an affinity for the Terrapins, this is a rare instance in which DeMarco doesn’t feel the need to be diplomatic.
“I’ve got rooting interest on both sides, but clearly my stronger passion is for my undergraduate degree,” says the lifelong Irish fan.