Measure To Reform Fannie And Freddie Fails

A trio of Senate Republicans failed in their quest to put an end to the days of taxpayer bailouts for Fannie Mae and Freddie Mac.

The GSE (Government Sponsored Enterprise) Bailout Elimination and Taxpayer Protection Amendment, sponsored by Sens. John McCain (R-Ariz.), Richard Shelby (R-Ala.) and Judd Gregg (R-N.H.), would have forced the government to relinquish control of the two government-backed mortgage giants within two years.

Recently, Fannie Mae, which lost $13.1 billion during the first quarter of this year, asked the government for an additional $8.4 billion to stay afloat. Similarly, Freddie Mac asked the government for $10.6 billion in funds after reporting a loss of $8 billion for the quarter. Combined, the two companies have borrowed $145 billion from the Treasury Department since the government took complete ownership of them during the heart of the nation’s financial collapse in 2008.

"We are not saying that Freddie and Fannie have to go out of business. We're saying we want them to be a business that is on a level playing field with other private sector competitors," said McCain to reporters today, hours before his amendment went down in a 56-43 vote.

Though most Republicans supported the item, it had its fair share of skeptics.

First, critics, including many Democrats in Congress, believed the measure would unwind Fannie and Freddie so quickly that it would create chaos throughout the entire housing market. House Financial Services Committee Chairman Barney Frank (D-Mass.), who has said he supports reforming the two GSE’s, called the amendment a huge gamble.

“Simply to abolish Fannie and Freddie...and not do anything to replace the functions they are now performing with a conservatorship, would be a disaster for housing, and therefore for the economy as a whole,” he said last week.

Furthermore, the liberal Center for American Progress recently referred to the legislation as “The Credit Crunch Restoration Act of 2010,” arguing that by abolishing a large chunk of the mortgage backing industry, millions of Americans would lose access to credit.

Democrats Writing Healthcare Bill Behind Closed Doors, Gregg Accuses

By Laurel Brishel Prichard
University of New Mexico/Talk Radio News Service

Sens. Judd Gregg (R-N.H.) and Lamar Alexander (R-Tenn.) said Thursday that the health reform bill must first become a law before reconciliation can be used to amend it.

“So much of this bill may be subject to the Byrd Rule and may go in one way and come out another way, assuming it comes out at all,” Gregg told reporters during a brief session.

Senate Republicans have secured 41 signatures on a letter demanding that reconciliation only be used on legislation involving budget adjustments, and not major policy changes, said Alexander.

“If any sentence is deemed that the policy is more significant then the budget adjustments that it applies to...it will be knocked out, the paragraph will be knocked out, and the section will be knocked out,” said Gregg.

Alexander reiterated a GOP desire to deal with reforming the nation's healthcare system in a "step-by-step" manner. Gregg agreed, and argued that a more piecemeal approach would yield a more transparent process.

“The simple fact is [Democrats] are hiding the bill. This is another one of those processes where it's being written in a hidden room, behind a hidden room, behind a hidden door,” said Gregg.

Senators Call For Task Force To Repair Debt

By Leah Valencia, University of New Mexico- Talk Radio News Service

Sens. Kent Conrad (D-N.D.) and Judd Gregg (R-N.H.) called on Congress Wednesday to repair the national debt, introducing legislation to create a bipartisan task force to address the long-term budget crisis.

“The biggest threat that faces our nation today is our fiscal situation at the federal level,” Gregg said during a press conference. “We are on a path to bankruptcy as a nation.”

The Task Force for Responsible Fiscal Action Act would be made up 16 Congressional Members and two officials from the Obama administration, including the Secretary of the Treasury. The task force would deliberate to create recommendations to solve fiscal imbalances.

The commission would function under a supermajority. For recommendations to be submitted for a vote, 14 of the 18 members would have to approve it.

“What we have outlined here has the best prospect of success but what is absolutely essential is that there be a special process, that it be bipartisan and that it lead to an assured vote on the work product of the task force,” Conrad said.

Both Senators said they want the bill to be a part of the upcoming vote to increase the debt limit, adding that they will not vote to raise the federal debt limit unless Congress commits to the task force.

“We’re saying very clearly that we’re not going for debt limit extension without an approach like this being included,” said Conrad. “We’re not going to relent on this and we’re not going to agree to any kind of long-term debt limit extension.”
 
The bill has 24 bipartisan co-sponsors thus far: nine Democrats, 14 Republicans and one Independent.

GOP Senators Worry About Cost Of Health Care Bill

By Marianna Levyash - Talk Radio News Service

Senators Lamar Alexander (R-Tenn.) and Judd Gregg (R-N.H.) displayed concern over the high cost of the Senate health care bill during a press conference Thursday.

According to statistics Gregg obtained from the Senate Budget Committee, the bill increases federal spending by $1.2 trillion between now and 2019, and if fully implemented, it would cost over $2.5 trillion over the next ten years.

“This representation that it’s an $850 million dollar bill is simply wrong,” said Gregg.

Republicans opposed to the legislation say taxes will go up by nearly $500 billion, Medicare will be cut by $465 billion and that 24 million people will still be left uninsured.

“Revenues shouldn’t go to create a new entitlement, they should go to reduce the out-year already contingent unfunded liability that we have in Medicare,” stated Gregg.

The Senate is expected to vote on the bill this coming Saturday.

"Spending money I haven't made yet for things I don't want."

Coffee Brown, University of New Mexico, Talk Radio News

Paul Ryan (R-Wis.) said, “The president is proposing to increase our national debt more than all prior 43 presidents combined,” adding $2.3 trillion more “to the national debt in higher deficits” than his own budget office stated.

Ryan said the budget increases taxes and spending. “But what’s so galling about this – we read today the Chinese are talking about a new currency, the Russians are talking about a new currency. We are debasing the value of the American dollar by borrowing way beyond our means,” he said.

“We are consigning our next generation to an inferior standard of living,” Ryan said.

He estimates the national debt will double in six years and triple in ten.

Dan Mitchell, senior fellow at the CATO Institute, a libertarian think tank, said, “That’s just the tip of the iceberg, because … we have trillions and trillions of unfunded liability for entitlement programs, … tens of trillions of dollars of unfunded liabilities in the future. We are in effect on a path to become the next Argentina.”

That other countries would consider a reserve currency other than the dollar is, he says, “a referendum that we are on the wrong track.”

Rep. Jim Jordan (R-Ohio), Chairman of the Fiscal Responsibility Task Force of the Republican Study Committee, said that one of the elements of greatness is the willingness of one generation to sacrifice for the next. The next generation, he said, will never be able to repay this debt.

He quoted Sen. Judd Gregg (R-N.H.) as saying this budget would bankrupt the country.

Rep. Marsha Blackburn (R-Tenn.) said “One of my constituents said it best, ‘I am tired of Congress spending money I haven’t made yet for things I don’t want.’ When you look at the push for nationalizing healthcare, when you look at the cap-and-tax scheme (Cap-and-Trade), this is what people are afraid is going to pile on more and more debt.”

“I look at this as being economic abuse of (her grandchildren’s) future,” she said.

Rep. Gregg Harper (R-Miss.) said, ”When you find out you’ve dug yourself a hole, you should quit digging, but we’ve brought in heavy machinery, and we’re making the hole so deep that we’re not going to be able to get out of it.”

“We tell our children we can’t afford to get everything,” he said, and now the children, the public, are telling the parents, the legislators, “We don’t really have to have that.”