Fannie/Freddie could pile onto U.S. spending woes

By Richard Cowan

WASHINGTON (Reuters) - The U.S. government takeover of mortgage giants Fannie Mae and Freddie Mac -- and the potential cost to taxpayers -- comes as Congress faces a staggering credit-card bill already poised to get much bigger, budget analysts said on Monday.

While there are no firm estimates of how much the rescue of Fannie Mae and Freddie Mac could end up costing, the Treasury Department is committing to provide up to $200 billion to buy shares in the two companies.

This huge new exposure comes as taxpayers are being asked to shoulder other new burdens that will be debated in Congress as it begins a three-week work session.

"You wonder when are people going to wake up," said Robert Bixby, executive director of the Concord Coalition. "Everything that Democrats or Republicans want to do -- they say we can't worry about the budget because we have to do this, it's too important."

"There are so many of those promises out there that you have to start wondering who's going to bail out the government?" added Bixby, whose group pushes fiscal responsibility.

But with congressional elections less than two months away, Congress might be in a spending mood to help its members improve their standing with voters.

DEMANDS ON CONGRESS

Consider the following list of demands on Congress:  Continued...