Legal Commentary

More On The Geithner Plan

By Big Tent Democrat

I will bore you to tears, but this time using Robert Kuttner:

At a recent conference of the New America Foundation, economist and Obama adviser Laura Tyson, an in exchange with me, defended the administration's approach on the premise that there was no way that Congress would legislate the one to two trillion dollars in public funds that will be needed to make this rescue work. So, in Tyson's view, there was no alternative other than having Treasury contrive its own plan, using the Fed as an all purpose source of unlegislated financing.

[More...]

I think this is exactly backwards. . . . [I]f the White House had proposed a more progressive approach to the whole financial rescue--taking failed banks into receivership, involving Congress in the program design, doing comprehensive government audits of bank balance sheets before rather than after the fact, and forcing bank shareholders and bondholders rather than taxpayers to take more of the hit --Congress might well have provided at least some of the funds, leaving the Fed to provide the rest.

(Emphasis supplied.) But Krugman Kuttner always hated Obama so this is wrong.

Speaking for me only

Full post as published by TalkLeft on March 30, 2009 (boomark / email).