Over the holidays, Congress and the Obama Administration passed several pieces of legislation that not only will increase the burden on American taxpayers, but will also grow the government.
1) The Senate Health Care Bill: Passed December 24, 2009
The Senate Health Care Bill passed on Christmas Eve at 7:05 am, by a vote of 60 to 39. The bill will overhaul the entire health care sector of the U.S. economy by erecting massive federal controls over private health insurance, and dictating the content of insurance benefit packages and the use of medical treatments, procedures, and medical devices. It will alter the relationship between the federal government and the states, transferring massive regulatory power to the federal government. The bill will also restrict the personal and economic freedom of American citizens by imposing controversial and unprecedented mandates on businesses and individuals, including an individual mandate to buy insurance.
2) The Debt Limit Increase: Passed December 24, 2009
Also on the morning of Christmas Eve, the statutory limit on the debt was increased $290 billion to $12.4 trillion. The recession and excessive spending have caused the debt held by the public to grow sharply to 56% of the economy, topping the historical average of 36%. To make matters worse, entitlement programs will double in size over the next few decades and cause the national debt to reach 320% of the economy. To avoid perpetual trillion-dollar debt limit increases, Members of Congress should finally address the long-term budget problems posed by Social Security, Medicare, and Medicaid.
3) Elimination of Cap on Money to Fannie and Freddie: Lifted December 24, 2009
On December 24, the Obama Administration lifted caps on how much bailout money Fannie Mae and Freddie Mac can receive from the U.S. Treasury. The old limits for the firms, both of which are under federal conservatorship, had been set at $200 billion each. However, those limits were done away with over the holidays, and requirements that the two firms shrink their portfolios were watered down. It is not entirely clear what spurred the Christmas Eve announcement. The move may have been to anticipate horrendously large losses by the two firms for the fourth quarter. It also may have been done to allow the twin firms to buy even more mortgages, further propping up the housing market. Using the two firms as tools of economic policy is nothing new, as the government has been using them to pump money into the declining housing market for a year.