Best columns: Smarter relatives, Lucrative luxury

Fannie and Freddie’s more successful cousin

While Fannie Mae and Freddie Mac are being propped up by taxpayers, says Daniel Gross in Slate, an obscure cousin agency, the Federal Home Loan Banks, has been propping up the banking industry. The 12 regional FHLBs are owned by 8,100 member banks, not by public shareholders, and they essentially funnel “cash from Wall Street to banks on Main Street.” Unlike Fannie and Freddie, the FHLB is doing quite well—largely because it avoided the “junky subprime” market. When the “mortgage house of cards began to collapse” last year, banks got $274 billion in new credit from the FHLB. That “dwarfs” the “public-rescue efforts” for Fannie and Freddie. And taxpayers probably aren’t on the hook.

The successful premium airline premium

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Removing 40 percent of the seats in a Boeing 757 and raising prices doesn’t “sound like a typical recipe” for success at a U.S. airline, says Scott McCartney in The Wall Street Journal, but that is what United did on two of its busiest routes—and “they were the best routes financially for the airline in the country” last year. On its New York to L.A. and New York to San Francisco flights, United converted half the cabin to spacious first or business class seats. These seats go for as much as $5,167 round-trip, or $884 on average, but in a discount market the “United p.s.” flights show “that at least on some routes, domestic U.S. travelers will pay extra for very nice service.”