November 4, 2008
Looking beyond the e-day buzz, the NYT examines the rise of a new technocracy within the U.S. Treasury Department as that office struggles to cope with the overwhelming demands on the bailout funds.
Administration officials offer reassurances that the small team of individuals charged with disbursing over $300 billion will not allow the office to become politicized. However, the lack of transparency or detailed criteria as to how the group makes decisions to save or abandon dozens of large firms in the financial sector ensures that they quietly implementing a covert policy agenda that we will only understand as patterns and evidence of their choices emerge.
Thus, as a direct result of Congress’ willingness to hand Henry Paulson a blank check, the U.S. will now silently embark on a new financial industry policy at a moment when the country’s position in the global economy is most vulnerable.
Don’t get me wrong, I doubt that it would have been better to create mechanisms of congressional oversight (that would merely have guaranteed a politicized process) or a more open set of bailout criteria (the markets would have gone even more haywire). Nevertheless, I have to wonder if there was not some “third way” whereby the people in charge of the bailout disbursements could have been selected to represent a variety of political/economic/industrial perspectives. Instead, we have once again closed our eyes and passed our collective economic fate into the hands of an unelected cluster of investment bankers.