(i) 
MORTGAGE-BACKED
SECURI-
TIES.—Section 304(d) of the Federal Na-
tional Mortgage Association Charter Act 
(12 U.S.C. 1719(d)) is amended by strik-
ing the fourth sentence. 
(ii) SUBORDINATE
OBLIGATIONS.— 
Section 304(e) of the Federal National 
Mortgage Association Charter Act (12 
U.S.C. 1719(e)) is amended by striking the 
fourth sentence. 
(B) FREDDIE
MAC.—Section 306 of the 
Federal Home Loan Mortgage Corporation Act 
(12 U.S.C. 1455) is amended by striking sub-
section (g). 
(6) RECOUPMENT
OF
COSTS
FOR
FEDERAL 
GUARANTEE.— 
(A) ASSESSMENTS.—The Director of the 
Federal Housing Finance Agency shall establish 
and collect from each enterprise assessments in 
the amount determined under subparagraph 
(B). In determining the method and timing for 
making such assessments, the Director shall 
take into consideration the determinations and 
conclusions of the study under subsection (b) of 
this section. 
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(B) DETERMINATION OF COSTS OF GUAR-
ANTEE.—Assessments under subparagraph (A) 
with respect to an enterprise shall be in such 
amount as the Director determines necessary to 
recoup to the Federal Government the full value 
of the benefit the enterprise receives from the 
guarantee provided by the Federal Government 
for the obligations and financial viability of the 
enterprise, based upon the dollar value of such 
benefit in the market to such enterprise when 
not operating under conservatorship or receiver-
ship. To determine such amount, the Director 
shall establish a risk-based pricing mechanism 
as the Director considers appropriate, taking 
into consideration the determinations and con-
clusions of the study under subsection (b) of 
this section. 
(C) 
TREATMENT
OF
RECOUPED 
AMOUNTS.—The Director shall cover into the 
general fund of the Treasury any amounts re-
ceived from assessments made under this para-
graph. 
(b) GAO STUDY
REGARDING
RECOUPMENT
OF 
COSTS FOR FEDERAL GOVERNMENT GUARANTEE.—The 
Comptroller General of the United States shall conduct 
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a study to determine a risk-based pricing mechanism to 
accurately determine the value of the benefit the enter-
prises receive from the guarantee provided by the Federal 
Government for the obligations and financial viability of 
the enterprises. Such study shall establish a dollar value 
of such benefit in the market to each enterprise when not 
operating under conservatorship or receivership, shall ana-
lyze various methods of the Federal Government assessing 
a charge for such value received (including methods involv-
ing an annual fee or a fee for each mortgage purchased 
or securitized), and shall make a recommendation of the 
best such method for assessing such charge. Not later 
than 12 months after the date of the enactment of this 
Act, the Comptroller General shall submit to the Congress 
a report setting forth the determinations and conclusions 
of such study. 
SEC. 105. REQUIREMENT TO PERIODICALLY RENEW CHAR-
TER UNTIL WIND DOWN AND DISSOLUTION. 
(a) REQUIRED RENEWAL; WIND DOWN AND DIS-
SOLUTION UPON NON-RENEWAL.—Upon the expiration of 
the 3-year period that begins upon the expiration of the 
period referred to in section 103(b), unless the charter of 
an enterprise is renewed pursuant to subsection (b) of this 
section, section 106 (relating to wind down of operations 
and dissolution of enterprise) shall apply to the enterprise. 
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(b) RENEWAL PROCEDURE.— 
(1) APPLICATION; TIMING.—The Director shall 
provide for each enterprise to apply to the Director, 
before the expiration of the 3-year period under sub-
section (a), for renewal of the charter of the enter-
prise. 
(2) STANDARD.—The Director shall approve 
the application of an enterprise for the renewal of 
the charter of the enterprise if— 
(A) the application includes a certification 
by the enterprise that the enterprise is finan-
cially sound and is complying with all provisions 
of, and amendments made by, section 104 of 
this title applicable to such enterprise; and 
(B) the Director verifies that the certifi-
cation made pursuant to subparagraph (A) is 
accurate. 
(c) OPTION TO REAPPLY.—Nothing in this section 
may be construed to require an enterprise to apply under 
this section for renewal of the charter of the enterprise. 
SEC. 106. REQUIRED WIND DOWN OF OPERATIONS AND DIS-
SOLUTION OF ENTERPRISE. 
(a) APPLICABILITY.—This section shall apply to an 
enterprise— 
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(1) upon the expiration of the 3-year period re-
ferred to in such section 105(a), to the extent pro-
vided in such section; and 
(2) if this section has not previously applied to 
the enterprise, upon the expiration of the 6-year pe-
riod that begins upon the expiration of the period re-
ferred to in section 103(b). 
(b) WIND DOWN.—Upon the applicability of this sec-
tion to an enterprise, the Director and the Secretary of 
the Treasury shall jointly take such action, and may pre-
scribe such regulations and procedures, as may be nec-
essary to wind down the operations of an enterprise as 
an entity chartered by the United States Government over 
the duration of the 10-year period beginning upon the ap-
plicability of this section to the enterprise (pursuant to 
subsection (a)) in an orderly manner consistent with this 
title and the ongoing obligations of the enterprise. 
(c) DIVISION OF ASSETS AND LIABILITIES; AUTHOR-
ITY TO ESTABLISH HOLDING CORPORATION AND DIS-
SOLUTION TRUST FUND.—The action and procedures re-
quired under subsection (b)— 
(1) shall include the establishment and execu-
tion of plans to provide for an equitable division and 
distribution of assets and liabilities of the enterprise, 
including any liability of the enterprise to the United 
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States Government or a Federal reserve bank that 
may continue after the end of the period described 
in subsection(b); and 
(2) may provide for establishment of— 
(A) a holding corporation organized under 
the laws of any State of the United States or 
the District of Columbia for the purposes of the 
reorganization and restructuring of the enter-
prise; and 
(B) one or more trusts to which to trans-
fer— 
(i) remaining debt obligations of the 
enterprise, for the benefit of holders of 
such remaining obligations; or 
(ii) remaining mortgages held for the 
purpose of backing mortgage-backed secu-
rities, for the benefit of holders of such re-
maining securities. 
(d) REPEAL OF CHARTER.—Effective upon the expi-
ration of the 10-year period referred to in subsection (b) 
for an enterprise, the charter for the enterprise is re-
pealed, except that the provisions of such charter in effect 
immediately before such repeal shall continue to apply 
with respect to the rights and obligations of any holders 
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of outstanding debt obligations and mortgage-backed secu-
rities of the enterprise. 
TITLE II—PRICE STABILITY 
SEC. 201. SHORT TITLE. 
This title may be cited as the ‘‘Price Stability Act 
of 2008’’. 
SEC. 202. FINDINGS; STATEMENT OF POLICY. 
(a) FINDINGS.—The Congress finds the following: 
(1) Price stability is a prerequisite for sustain-
able long-term economic growth, job creation, and 
moderate interest rates. 
(2) Inflation erodes the value of Americans’ in-
come and savings. 
(3) Inflation distorts the pricing system and the 
efficient allocation of resources in the economy. 
(4) Inflation makes long-term planning difficult 
and raises the effective tax rate on capital, thereby 
impeding investment. 
(5) Through its determination of monetary pol-
icy, the Board of Governors of the Federal Reserve 
System is ultimately responsible for controlling the 
long-run rate of inflation in the economy. 
(6) The multiple policy goals of the Full Em-
ployment and Balanced Growth Act of 1978 cause 
confusion and ambiguity about the appropriate role 
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and aims of monetary policy, which can add to vola-
tility in economic activity and financial markets. 
(7) There is a need for the Congress to clarify 
the proper role of the Board of Governors of the 
Federal Reserve System in economic policymaking, 
in order to achieve the best environment for long- 
term economic growth and job creation. 
(8) An explicit price stability goal would pro-
mote transparency, accountability and credibility in 
monetary policy. 
(9) Price stability should be the primary long- 
term goal of the Board of Governors of the Federal 
Reserve. 
(b) STATEMENT OF POLICY.—It is the policy of the 
United States that— 
(1) the principal economic responsibilities of the 
Government are to establish and ensure an environ-
ment that is conducive to both long-term economic 
growth and increases in living standards, by estab-
lishing and maintaining free markets, low taxes, re-
spect for private property, and the stable, long-term 
purchasing power of the United States currency; and 
(2) the primary long-term goal of the Board of 
Governors of the Federal Reserve System should be 
to promote price stability. 
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SEC. 203. MONETARY POLICY. 
(a) AMENDMENT TO THE FEDERAL RESERVE ACT.— 
Section 2A of the Federal Reserve Act (12 U.S.C. 225a) 
is amended to read as follows: 
‘‘SEC. 2A. MONETARY POLICY. 
‘‘(a) PRICE STABILITY.—The Board and the Federal 
Open Market Committee (hereafter in this section referred 
to as the ‘Committee’) shall— 
‘‘(1) establish an explicit numerical definition of 
the term ‘price stability’; and 
‘‘(2) maintain a monetary policy that effectively 
promotes long-term price stability. 
‘‘(b) MARKET STABILITY
AND LIQUIDITY.—Sub-
section (a) shall not be construed as a limitation on the 
authority or responsibility of the Board— 
‘‘(1) to provide liquidity to markets in the event 
of a disruption that threatens the smooth func-
tioning and stability of the financial sector; or 
‘‘(2) to serve as a lender of last resort under 
this Act when the Board determines such action is 
necessary. 
‘‘(c) CONGRESSIONAL CONSULTATION.—Not later 
than February 20 and July 20 of each year, the Board 
shall consult with the Congress at semiannual hearings be-
fore the Committee on Banking, Housing, and Urban Af-
fairs of the Senate and the Committee on Financial Serv-
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ices of the House of Representatives, about the objectives 
and plans of the Board and the Committee with respect 
to achieving and maintaining price stability. 
‘‘(d) CONGRESSIONAL
OVERSIGHT.—The Board 
shall, concurrent with each semiannual hearing required 
by subsection (c), submit a written report to the Congress 
containing— 
‘‘(1) numerical measures to help assess the ex-
tent to which the Board and the Committee are 
achieving and maintaining price stability in accord-
ance with subsection (a); 
‘‘(2) a description of the intermediate variables 
used by the Board to gauge the prospects for achiev-
ing the objective of price stability; and 
‘‘(3) the definition, or any modifications there-
to, of the term ‘price stability’ established in accord-
ance with subsection (a)(1).’’. 
(b) COMPLIANCE ESTIMATE.—Concurrent with the 
first semiannual hearing required by section 2A(b) of the 
Federal Reserve Act (as amended by subsection (a) of this 
section) following the date of enactment of this Act, the 
Board of Governors of the Federal Reserve System shall 
submit to the Congress a written estimate of the length 
of time it will take for the Board and the Federal Open 
Market Committee to fully achieve price stability. The 
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Board and the Committee shall take into account any po-
tential short-term effects on employment and output in 
complying with the goal of price stability. 
SEC. 204. REPEAL OF OBSOLETE PROVISIONS. 
(a) FULL EMPLOYMENT AND BALANCED GROWTH 
ACT
OF 1978.—The Full Employment and Balanced 
Growth Act of 1978 (15 U.S.C. 3101 et seq.) is hereby 
repealed. 
(b) EMPLOYMENT ACT OF 1946.—The Employment 
Act of 1946 (15 U.S.C. 1021 et seq.) is amended— 
(1) in section 3 (15 U.S.C. 1022)— 
(A) in the section heading, by striking 
‘‘AND SHORT-TERM ECONOMIC GOALS AND 
POLICIES’’; 
(B) by striking ‘‘(a)’’; and 
(C) by striking ‘‘in accord with section 
11(c) of this Act’’ and all that follows through 
the end of the section and inserting ‘‘in accord-
ance with section 5(c).’’; 
(2) in section 9(b) (15 U.S.C. 1022f(b)), by 
striking ‘‘, the Full Employment and Balanced 
Growth Act of 1978,’’; 
(3) in section 10 (15 U.S.C. 1023)— 
(A) in subsection (a), by striking ‘‘in the 
light of the policy declared in section 2’’; 
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(B) in subsection (e)(1), by striking ‘‘sec-
tion 9’’ and inserting ‘‘section 3’’; and 
(C) in the matter immediately following 
paragraph (2) of subsection (e), by striking 
‘‘and the Full Employment and Balanced 
Growth Act of 1978’’; 
(4) by striking section 2; 
(5) by striking sections 4, 5, 6, 7, and 8; and 
(6) by redesignating sections 3, 9, 10, and 11 
as sections 2, 3, 4, and 5, respectively. 
(c) CONGRESSIONAL BUDGET ACT OF 1974.—Title 
III of the Congressional Budget Act of 1974 (2 U.S.C. 
631 et seq.) is amended— 
(1) in section 301— 
(A) in subsection (b), by striking para-
graph (1) and redesignating paragraphs (2) 
through (9) as paragraphs (1) through (8), re-
spectively; 
(B) in subsection (d), in the second sen-
tence, by striking ‘‘the fiscal policy’’ and all 
that follows through the end of the sentence 
and inserting ‘‘fiscal policy.’’; 
(C) in subsection (e)(1), in the second sen-
tence, by striking ‘‘as to short-term and me-
dium-term goals’’; and 
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