Now that the Federal Government has a clear field for mandating purchases of any sort, one hopes they will exercise some restraint, restricting their diktats only to products which the Government itself has a dominant market leadership position.
Like housing. Over 90% of all mortgages are issued and insured through Fannie Mae, Freddie Mac and the FHA. The local bank may process the paperwork, but Uncle Sam owns the mortgage (and therefore the property). The Feds will surely want to guarantee the success of their investment, so we may get some sort of purchase requirement here. Or perhaps just a renters’ tax equal to the amount of interest revenue they had hoped to generate.
We should note here as well, that the Treasury has donated north of two trillion dollars into the TBTF banks. Reasonable to expect that Treasury will want this money back in much higher bank contributions to the FDIC liquidation fund. Banks may want to pass this added expense on to customers. Customers may not want to pay. Should there be a flood of closed accounts, jeopardizing the Government’s planned revenue stream, then perhaps a mandate to have a checking account or pay a tax equal to monthly fees, would make sense.
Fortunately, virtually no new mandates should be required for the health care industry or education. With the exception of the odd, faith-based school or hospital, both of these sectors are already wholly-owned, government subsidiaries.
The Government did announce a small acquisition of all the remaining private pensions, which has gone largely unnoticed in the health care hullaballoo. As part of the Highway Bill, private pensions will not be required to contribute as much to the pension itself, but pay more into the Pension Benefit Guarantee Corporation (PBGC). Since the pensions were already underfunded, smaller contributions to the plans will almost certainly guarantee their failure, at which point the fully funded PBGC can scoop them up for fifty cents on the dollar. Granted, this is a small beer deal for U.S.A. Inc., which owns Social Security obviously, as well as voting rights to the State Public pensions. Still, a nice little bolt-on asset to the portfolio.
Speculation regarding a so-called ‘broccoli mandate’ is just silly. The Government does not own any vegetables (unless you count farm subsidies)., and healthier people would only cut into health care profits.
The idea that the Federal Government has taken over the U.S. economy, is clearly alarmist. In fact- other than where you live, education, health care and any transaction which requires money- we are perfectly free to do whatever we want.