I know it seems like we’ve done this before (we have), but the federal government is bailing out AIG to the tune of $30B plus a relaxation of the terms of its existing loan. Even the New York Times reporter seems dubious:
Federal officials, who worked feverishly over the weekend to complete the restructuring, said they thought they had no choice but to prop up A.I.G., because its business and trading activities are so intricately woven through the world’s banking system. But the deal also presents more financial risks to taxpayers at a time when the public and Congress have been sharply questioning the wisdom of risking federal money to bail out private enterprises.
One wonders when the populist outrage over bailouts for wayward homeowners, GM, Chrysler, Citibank, and AIG (again) will impact the administration. It seems to be operating without Congressional authorization in the new imperial presidency of unilateral appropriation. (George W. Bush started down this road when Congress had the nerve to rebuff his auto bailout proposal in the waning days of his administration.)
In normal times, when Congress was in charge of appropriations, popular opinion would register with congressmen and senators and slow down or block legislation. But what and who is to stop a president who acts without Congress and is impervious to polling or popular protest? When money is no longer an object (what’s another $30B in debt, after all?) and the legislative branch is removed from the process there isn’t much to slow down the train. If Congress remains too timid to intervene, the public has little recourse — until the next election.
And, yes, all the pundits and Congressional liberals who decried an imperial presidency are noticeably, but not surprisingly, quiet. In addition to the aggregation of executive power, you would think they’d take note of the seamlessness between the final months of the Bush administration (e.g. Geithner, bailout mania, non-communication about both the big picture and the specifics) and the Obama administration. Weren’t we all hoping for change?