We may soon enter a true constitutional crisis. It also is quite possible that we are already there.
With maximum haste, our elected representatives have drafted language that would give the Secretary of the Treasury powers literally beyond the law. See Section 8.
In addition, this ill-conceived, deeply damaging intervention has no upper limit. None. See Section 6’s “outstanding at any one time.”
Section 3.2 is an affront, a lie.
Section 12.1 further opens the door for this insanity to advance beyond mortgages only to any kind of paper (e.g. credit default swaps, etc.) based on mortgages.
I have added emphasis to the excerpts below. Please read in full the “Text of Draft Proposal for Bailout Plan” via the NYT.
LEGISLATIVE PROPOSAL FOR TREASURY AUTHORITY
TO PURCHASE MORTGAGE-RELATED ASSETS
Sec. 2. Purchases of Mortgage-Related Assets.
(b) Necessary Actions.—The Secretary is authorized to take such actions as the Secretary deems necessary to carry out the authorities in this Act, including, without limitation:
(1) appointing such employees as may be required to carry out the authorities in this Act and defining their duties;
(2) entering into contracts, including contracts for services authorized by section 3109 of title 5, United States Code, without regard to any other provision of law regarding public contracts;
(3) designating financial institutions as financial agents of the Government, and they shall perform all such reasonable duties related to this Act as financial agents of the Government as may be required of them;
(4) establishing vehicles that are authorized, subject to supervision by the Secretary, to purchase mortgage-related assets and issue obligations; and
(5) issuing such regulations and other guidance as may be necessary or appropriate to define terms or carry out the authorities of this Act.
Sec. 3. Considerations.
In exercising the authorities granted in this Act, the Secretary shall take into consideration means for—
(1) providing stability or preventing disruption to the financial markets or banking system; and
(2) protecting the taxpayer.
Sec. 6. Maximum Amount of Authorized Purchases.
The Secretary’s authority to purchase mortgage-related assets under this Act shall be limited to $700,000,000,000 outstanding at any one time
Sec. 8. Review.
Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.
There is really nothing to add in terms of commentary upon such panic and madness.
The photo is not directly to this item (though its caption illustrates the abject indisputable failure of this Secretary.)
