Bank bail out creates Hugo Chavez of U.S. banking

by Kurt Schulzke on September 22, 2008

Too much power to the Treasury. Once you get past the sticker shock and the idea that a huge chunk of U.S. banking is on the verge of nationalization, the most troubling feature about the bank bail-out bill now before Congress is Section 8. That section reads as follows:

Decisions by the [Treasury] 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.

In other words, the Treasury Secretary would have more power over U.S. mortgage markets than Hugo Chavez has over Venezuelan oil — way too much power in a government that pretends to advocate free markets.

That much authority should be unconstitutional in the United States. However, over the past several decades, the Supreme Court seems to have left the door open for this kind of power grab. Thanks to greedy middle-class home buyers (who wanted expensive homes regardless of their real ability to pay) and profit-hungry bankers and shareholders (who wanted their bonuses and profits no matter what), it’s about to happen right here in River City.