Debate has resumed over the future of Fannie Mae and Freddie Mac after recent comments by U.S. Treasury secretary nominee Steve Mnuchin that they should be privatized. The two government-sponsored enterprises buy home mortgages, pool them and sell them as mortgage-backed securities in the secondary market, with a share of more than 45% of that market. Fannie Mae and Freddie Mac have been in government conservatorship since 2008 after a government bailout of 7.5 billion rescued them from the 2007 subprime mortgage finance crisis.

Mnuchin’s plan has lifted the share prices of both companies amid hopes of windfall payments for private shareholders.…