It’s good to be the king, and with two strokes of a pen on Thursday the Obama Administration was able to create about half a billion dollars to spend on some of its favorite housing lobbies.

The windfall is courtesy of Mel Watt, the regulator for Fannie Mae and Freddie Mac, who in a pair of letters directed the two mortgage giants to begin filling two housing funds that are in essence political dispensaries. Democrats created the funds in 2008 as part of a housing finance reform bill. But when Fan and Fred failed soon thereafter,...