The Obama administration is considering asking Congress to give the Treasury secretary unprecedented powers to initiate the seizure of non-bank financial companies, such as large insurers, investment firms and hedge funds, whose collapse would damage the broader economy, according to an administration document.Read it here.The government at present has the authority to seize only banks.
Giving the Treasury secretary authority over a broader range of companies would mark a significant shift from the existing model of financial regulation, which relies on independent agencies that are shielded from the political process. The Treasury secretary, a member of the president's Cabinet, would exercise the new powers in consultation with the White House, the Federal Reserve and other regulators, according to the document.
Gee, and you believed that bit about him not being a socialist.
The essential fallacy of this entire thing is the belief that government bureaucrats can make credit and investment decisions more wisely than businessmen who, to use one of Obama's more disgusting figures of speech, have "skin in the game".
