Perhaps the thorniest economic issue policymakers face is determining what role the government should play in the mortgage market. It’s such a vexing issue that this Congress may follow its predecessors and kick the can down the road.

The Federal Housing Administration and government-backed mortgage purchaser Fannie Mae were created in the 1930s, largely because of economic considerations. During the Great Depression about one-third of the unemployed were involved in construction-related trades. Subsidizing home ownership stimulated the housing market and put Americans back to work.

Those were noble motivations at the time, but since then the reasons for Fannie Mae’s existence have become more political. Over the intervening decades studies have shown that supporting home ownership is politically expedient; it helps politicians win supporters, and homeowners are more likely to take part in the political process by voting. These factors led President Lyndon B. Johnson to aggressively expand the government’s role in the mortgage market in 1968 as part of the Great Society program.

These political considerations will likely win out once again. Despite the rhetoric we’ve heard since the start of the financial crisis, it’s unlikely that the government’s role in the housing market will diminish. There are practical reasons for government involvement in the sector as well; if Fannie Mae and Freddie Mac were eliminated, we’d simply be swapping one problem for another.

Fannie Mae and Freddie Mac’s supporters argue that these government-sponsored enterprises (GSE) help keep mortgage costs low. Were the GSEs to be disbanded, the cost of a traditional 30-year mortgage would rise significantly. Few banks would be willing to assume the long-lived credit and rate risks associated with a 30-year note without sufficient compensation.

Even if mortgage lending were solely under the purview of the banks, the taxpayers would remain on the hook in the event of another housing crisis. The Federal Deposit Insurance Corporation (FDIC) was formed to instill confidence in the US banking system during the Great Depression’s darkest days. The FDIC now insures deposits at almost 8,000 banks nationwide.

Between 2007 and 2010, 322 banks failed at a cost of more than $74 billion to the FDIC. Although fees levied against the banking industry account for much of the FDIC’s deposit insurance fund, the US taxpayer could be on the hook if losses were to drain the fund.