President Barack Obama returns from vacation Tuesday to face legislative battles with newly empowered Republicans determined to slash spending and repeal his health care reform, the key legislative achievement of his first two years in office.

The new Congress convenes Wednesday with Republicans back in charge in the House of Representatives and their numbers — while still a minority — significantly increased in the Senate.

With the damaged economy, unemployment and the national debt uppermost among American concerns, Republicans have vowed to shrink government and ease federal oversight of the private sector. That, they argue, will unshackle private business to heal the wounds from the worst economic downturn since the Great Depression of the 1930s.

Obama and most Democrats counter that regulation is more necessary now than ever, especially after the private financial sector — using untested investment tools — nearly brought down the economy in the fall of 2008. And Obama and his fellow Democrats fought too long and too hard for health care reform to shirk even the smallest fight on that issue.

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