“As lawmakers, it is time to open up our eyes and open up our minds to alternative models and a pathway forward,” said Rep. Jeb Hensarling, R-TX, chairman of the House Financial Services Committee, at the beginning of a hearing he convened this week to consider housing finance models without explicit government guaranties. Hensarling, along with many Republicans in his committee, is angling to replace the government-sponsored enterprises with some sort of a non-agency market. However, a number of obstacles exist in that path, including the preference among Democrats and a significant portion of industry players for the GSEs’ functions to be replaced with some form of government guaranty. Most of the witnesses at the hearing provided...