Peter Wallison and Ed Pinto write,

While everyone has been watching Fannie and Freddie, the administration has quietly shifted most federal high-risk mortgage credit initiatives to FHA, the government’s original subprime lender. Along with two other federal agencies, FHA now accounts for about 60 percent of all U.S. home purchase mortgage originations. This amounts to more than $1 trillion and is rising rapidly.

So far, the government has lost very little money buying troubled mortgage assets through TARP. That is because TARP never bought many troubled mortgage assets to begin with.

Meanwhile, we have this huge expansion of FHA. Should taxpayers be high-fiving about TARP’s success if FHA winds up losing hundreds of billions instead?