Will the Financial Reform Bill Reform Anything?

The recent economic disaster that begun in 2007 still has a stranglehold on our economy and the focus of the government is to pass legislation to prevent a financial catastrophe like this from occurring again. The most recent attempt by our government to curb such recklessness in the future is called the financial reform bill.  The housing industry is one of the culprits responsible for the economic downturn.  Freddy Mac & Fannie Mae were the star players in this industry.  So the question that needs to be asked is this:  <em>How can the government claim to pass a financial reform bill to prevent another housing disaster if there is no reference to Fannie Mae or Freddy Mac in the bill?</em>
According to Forbes Magazine, Fannie and Freddie were what are known as government sponsored entities, which means that, like all private companies, their ultimate goal was maximize shareholder value. However, the value of the mortgages that they sold was guaranteed by the government. They took on more risk in an effort to make more profit because if things took a turn for the worse, the U.S. government (taxpayers) would bite the bullet. It is like having all of the upside of running your own high risk portfolio without any downsides.
Specifically, in 2005, Fannie and Freddie saw a sudden shift in their investment strategies from following a relatively conservative investment strategy based on tried and true prudent lending strategies to a significantly more risky lending strategy.  Not surprisingly, the percentage of riskier securities like subprime mortgages and mortgages with a loan-to-value ratio of greater than 90% skyrocketed. 
Their mindset was that if the investment worked out they would see an increase in profitability and if it did not, they would not have to face the downside because, as mentioned earlier, they are being backed by the U.S. government, therefore, they did not have exposure to the incredibly high default rate and the sharp decrease in home values. So if things worked out well, they made billions, and even if it didn’t and millions of Americans lost their houses, well, so what, they were covered financially.  This reckless protection, combined with their risky investment practices, created a devastating effect for the U.S. housing market and economy as a whole.
Wouldn’t it seem as though the above was the biggest reason for the fall of the housing industry and the solution for prevention would be stronger management or dissolution of Freddie and Fannie?  
Fannie and Freddie are the financial institutions with the most need for change and the reform bill contains no serious overhaul for them. So the question remains, why are Fannie and Freddie not mentioned in the bill?  According to the Forbes article, two of the reform bill’s biggest proponents, Chris Dodd and Barney Frank, are among Fannie Mae and Freddie Mac’s largest beneficiaries receiving $133,900 and $40,100, respectively. The third highest beneficiary is President Barack Obama, who was paid $105,849 in campaign contributions, and the list goes on.  I guess it helps when you have high ranking government officials on your payroll, it’s easy to avoid financial reform.
Which is why this bill is doomed to fail.