Is Paulson The Economy’s Rumsfeld?


Let’s remember, shall we? An unprecedented and major crisis – which the president says could destroy the country. The answer? Appointing a member of his administration to have near-total power over the enterprise, unfettered by checks and balances, with unlimited resources to dispense with as he wants. Yes, there’s some oversight in the package that has emerged today – but not much:

"The administration’s original proposal was a non-starter," Sen. Chris Dodd (D-Conn.) said this afternoon. "They wanted a blank check and we couldn’t give it to them." At the same time, Paulson will get direct hiring authority for building the staff that will carry out the bailout, the ability to set regulations, and the power to designate financial institutions as agents of the government.

I understand that something almost certainly had to pass. But the impulse behind the Bush administration’s "strongman" approach to government is as dangerous in the economy as in the war:

It is now extremely clear that, in the run-up to the Iraq war, Congress and the press failed in their duty. We were much too credulous toward an administration’s certainty in the face of great peril. We let deliberation cede to pure action. When reality started to seep through the propaganda, the administration responded by smearing the press, demonising the opposition and running election campaigns on the basis of fear and deference to presidential authority. In the face of the current economic crisis we surely mustn’t make the same mistake again. We have to demand transparency, deliberation, debate and factual data. We must not be rushed into anything rash. Handing a financial dictator a trillion dollars to do with as he wishes is not a democratic impulse; it is antidemocratic.

This is a critical moment for real conservatives to stand up and be counted.

Edmund Burke, the founder of Toryism, was concerned above all with checks on concentrated power. Nothing appalled him more than naked, unchecked executive power – as the third and fourth US presidents, Thomas Jefferson and James Madison, also understood. And yet that is what has consumed the American constitution for the past seven years, aided and abetted by so-called conservatives who have let fear override reason, power trump freedom and terror displace the rule of law.

In some ways what we are seeing now is also reassuring. It is the end of a great, recent American illusion. The illusion that you can delegate self-government to a great leader. You can’t. The illusion that wars are won purely by saying they can’t be lost. The illusion that you can borrow and borrow and spend and spend and the day of reckoning will never come. But that day is here. And it is long overdue.

In the resistance to the bailout from men like Cantor and Pence, we may be seeing the saplings of the conservatism that could emerge after what may well be the Big Liberal Leap of the Bush-Obama years. Well, I guess you’ve got to start somewhere.

(Photo: Jim Watson/AFP/Getty.)