This was a vote on an amendment by Sen. David Vitter (R-LA) that would have limited taxpayer liability for the federal government’s takeover of Fannie Mae and Freddie Mac (government-sponsored enterprises charged with expanding the home mortgage market) to $200 billion. (The federal government—during the Bush administration--had effectively taken over Fannie Mae and Freddie Mac during the financial crisis of 2008 in order to stabilize the housing market.) This amendment was offered to legislation that would provide annual funding in fiscal year 2012 for Agriculture, Transportation, and Commerce department programs.  

Vitter urged support his amendment: “My amendment would simply say, particularly if there is going to be this expansion, we should limit taxpayer liability to $200 billion, and the taxpayer should definitely be paid the dividend they were promised. I think that is a very reasonable taxpayer protection.”

Sen. Richard Shelby (R-AL) said: “ I urge my colleagues to support the Vitter amendment. The amendment will limit the taxpayers' exposure to the bailout of Fannie and Freddie. No more blank checks. We have already spent $169 billion in taxpayer dollars; $200 billion is more than enough. Think about it.”

Sen. Tim Johnson (D-SD) opposed Vitter’s amendment: “…This amendment would essentially force the wind-down of Fannie Mae and Freddie Mac prematurely without any structure to take their place. The Banking Committee has heard from witnesses, including Dwight Jaffee and Mark Zandi, that taking over Fannie Mae and Freddie Mac were the only options the government would have to avoid a complete market collapse. This amendment could plunge us back into the panic of 2008, when credit was unavailable and the economy was on the verge of collapse. Mortgages would not be finalized, home sales could not go through, and the home owners would be unable to refinance. The Vitter amendment would eliminate any stability we have achieved in the housing market. The Vitter amendment is an irresponsible response to the housing crisis, and I urge my colleagues to oppose this amendment.”

The Senate rejected Vitter’s amendment by a vote of 41-57. Voting “yea” were 41 Republicans. All 52 Democrats present and 5 Republicans voted “nay.” As a result, the Senate rejected an amendment that would have limited taxpayer liability for the federal government’s takeover of Fannie Mae and Freddie Mac (government-sponsored enterprises charged with expanding the home mortgage market) to $200 billion.