Fannie Mae and Freddie Mac are certainly part of the current financial crunch. But looking deeper than that, the Community Reinvestment Act is probably more responsible than anything else for the housing collapse. It was implemented by congress during the Carter Administration in 1977. They push banks and other lenders to allow ridiculous latitude on the credit worthiness of applicants.

Their acronym is CRA. I have trouble with acronyms, so I just add a "P" to help me remember it for Google purposes. Check it out for an educational awakening.