Lockhart ’64: Bush’s Ex-Teammate Now Fixing Fannie and Freddie

Faced with the task of helping to pull the U.S. out of a tremendous economic crisis, James B. Lockhart III ’64 can draw upon his experience in the U.S. Navy and in managing the pensions of millions of Americans to rescue the economy. Lockhart’s current role, as CEO and Chairman of the Oversight Board of the Federal Housing Finance Agency (OFHEO), makes him the regulator of Fannie Mae, Freddie Mac and the 12 Federal Home Loan Banks. In addition to ensuring the safety and soundness of mortgage finance lenders Fannie Mae and Freddie Mac, the OFHEO oversees and ensures “that [Mae and Mac] fulfill their mission, which is really providing stability and liquidity to the mortgage market,” said Lockhart. Lockhart said his current job has been his most challenging and complex in comparison to his years spent working in the private sector and overseas. As a result of the current strains on the economy, “this [job] has obviously been a very difficult thing [to do],” Lockhart said. Fannie Mae and Freddie Mac are government-sponsored enterprises (GSEs) that turn mortgages purchased from banks into packages to sell worldwide. As the subprime mortgage crisis unfolded, Lockhart personally announced the decision of the federal government to assume responsibility over Fannie Mae and Freddie Mac on September 7, 2008. In June 2006, the Senate confirmed current President George W. Bush’s nomination of Lockhart to the position of Director of OFHEO. Lockhart assumed the role of Director on July 30, 2008, after the signing of the Housing and Economic Recovery Act. Prior to assuming his current role, Lockhart served as Deputy Commissioner and Chief Operating Officer of the Social Security Administration and as Secretary to the Social Security Board of Trustees from 2002 until 2006. He has also served in high-ranking positions at Smith Barney, Alexander & Alexander and in Gulf Oil both in Europe and the U.S., among others. A 1964 graduate of Phillips Academy, Lockhart described the school as a place where “good things happened.” A classmate of President George W. Bush, both were members of the same baseball team – Bush pitched while Lockhart served as the team’s manager. After Phillips Academy, Lockhart and Bush attended Yale University together, where they were both members of the Delta Kappa Epsilon fraternity. After graduating in 1968, the two also went on to attend the Harvard Graduate School of Business Administration. Soon after earning his master’s degree at Harvard, Lockhart volunteered for service in the Navy. In the midst of the Vietnam War, Lockhart served as a second Lieutenant aboard the nuclear submarine USS George W. Carver. Lockhart has worked under both Bush administrations. Under former President George H.W. Bush, Lockhart served as Executive Director (CEO) of the Pension Benefit Guaranty Corporation, where he supervised the management of pension plans for millions of U.S. citizens from 1989 until 1993. On the topic of working for current President Bush, Lockhart said that friendships are important. Lockhart also mentioned how Andover mottos have influenced his career. He said, “‘Non Sibi’ is a very important motto for government service and one of the things that has really guided me through my career.” While creating a new agency, the phrase “the end depends on the beginning” also comes to mind, Lockhart said. In spite of the current uncertainty, Lockhart maintained a positive outlook for the future of the U.S. economy. “We will [be able to] weather this. I would certainly expect a recovery.”