Government Influence and the Failure of Fannie Mae and Freddie Mac

In 2008 two government-sponsored enterprises, Fannie Mae and Freddie Mac, were placed into conservatorship due to insolvency. The financial bailout of the two publically traded corporations came at the expense of the American tax payer. This study investigates the relationship between direct and indirect government influence and the increasing risk taking of Fannie Mae and Freddie Mac from the late 1990’s through their conservatorship in 2008. As government-sponsored enterprises Fannie Mae and Freddie Mac have many special advantages that other publically traded companies did not possess. These advantages allowed Fannie Mae and Freddie Mac to increase their profitability. Theoretical literature regarding Congress and the bureaucracy suggests that the actions of bureaucrats can be linked to the preferences of Congressional members because bureaucrats are responsive to potential threats or perceived threats from the legislature. This theory is applicable to Fannie Mae and Freddie Mac, and is used to explain why the government was able to directly and indirectly influence the government-sponsored enterprises. Overall this investigation has determined that the United States government pursued a clear mission that determined to increase the availability of housing to all Americans, specifically to low-income and under-served individuals, through the use of the government-sponsored enterprises. Despite this link there is no conclusive data to show that the pursuit of this housing mission led Fannie Mae and Freddie Mac to operate in riskier business segments. This study has also found that motivation regarding profit-seeking and compensation structure provide a more plausible explanation for why the government-sponsored enterprises began to engage in riskier business practices that led to their insolvency.

Terrestrial feeding in aquatic turtles: environment-dependent feeding behavior modulation and the evolution of terrestrial feeding in Emydidae

Evolutionary transitions between aquatic and terrestrial environments are common in vertebrate evolution. These transitions require major changes in most physiological functions, including feeding. Emydid turtles are ancestrally aquatic, with most species naturally feeding only in water, but some terrestrial species can modulate their feeding behavior appropriately for both media. In addition, many aquatic species can be induced to feed terrestrially. A comparison of feeding in both aquatic and terrestrial environments presents an excellent opportunity to investigate the evolution of terrestrial feeding from aquatic feeding, as well as a system within which to develop methods for studying major evolutionary transitions between environments. Individuals from eight species of emydid turtles (six aquatic, two terrestrial) were filmed while feeding underwater and on land. Bite kinematics were analyzed to determine whether aquatic turtles modulated their feeding behavior in a consistent and appropriate manner between environments. Aquatic turtles showed consistent changes between environments, taking longer bites and using more extensive motions of the jaw and hyoid when feeding on land. However, these motions differ from those shown by species that naturally feed in both environments and mostly do not seem to be appropriate for terrestrial feeding. For example, more extensive motions of the hyoid are only effective during underwater suction feeding. Emydids evolving to feed on land probably would have needed to evolve or learn to overcome many, but not all, aspects of the intrinsic emydid response to terrestrial feeding. Studies that investigate major evolutionary transitions must determine what responses to the new environment are shown by naïve individuals in order to fully understand the evolutionary patterns and processes associated with these transitions.

Risk Judgment in Obsessive-Compulsive Disorder: Testing a Dual-Systems Account

Dual-systems theorists posit distinct modes of reasoning. The intuition system reasons automatically and its processes are unavailable to conscious introspection. The deliberation system reasons effortfully while its processes recruit working memory. The current paper extends the application of such theories to the study of Obsessive-Compulsive Disorder (OCD). Patients with OCD often retain insight into their irrationality, implying dissociable systems of thought: intuition produces obsessions and fears that deliberation observes and attempts (vainly) to inhibit. To test the notion that dual-systems theory can adequately describe OCD, we obtained speeded and unspeeded risk judgments from OCD patients and non-anxious controls in order to quantify the differential effects of intuitive and deliberative reasoning. As predicted, patients deemed negative events to be more likely than controls. Patients also took more time in producing judgments than controls. Furthermore, when forced to respond quickly patients' judgments were more affected than controls'. Although patients did attenuate judgments when given additional time, their estimates never reached the levels of controls'. We infer from these data that patients have genuine difficulty inhibiting their intuitive cognitive system. Our dual-systems perspective is compatible with current theories of the disorder. Similar behavioral tests may prove helpful in better understanding related anxiety disorders. (C) 2013 Elsevier Ltd. All rights reserved.