Obama Seeks Power to Take Over Other Businesses

Something about this is looking a little fishy:

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.

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.

The administration plans to send legislation to Capitol Hill this week. Sources cautioned that the details, including the Treasury's role, are still in flux.

Treasury Secretary Timothy F. Geithner is set to argue for the new powers at a hearing today on Capitol Hill about the furor over bonuses paid to executives at American International Group, which the government has propped up with about $180 billion in federal aid. Administration officials have said that the proposed authority would have allowed them to seize AIG last fall and wind down its operations at less cost to taxpayers.

So, the nonsense about the AIG bonuses, protection of which was amended into the Porkulus Bill at the insistence of the White House and Treasury, will be used to help justify increased powers to take over other financial businesses. I'm not much for conspiracy theories, but this whole thing is sounding like the AIG bonus "outrage" was cooked up to create an environment where the unwashed masses, mad as wet hens because some evil executives got the money they were entitled to according to their employment contract, will gladly stand by as the White House takes over new powers.

All to save us from evil corporate America.

The problem with this is the definition of a firm whose collapse could further damage the economy could easily be defined down to where any large company might qualify, even if they're not in the financial sector. Where does it stop?