Covering the Bush Administration’s latest attempt to save the free-market by abandoning free-market principles, The Washington Post reports:
The new loans push the government’s planned investments under the financial rescue beyond the $350 billion that Congress has authorized; in order to make all the investments that Treasury Secretary Henry M. Paulson Jr. has agreed to, Congress would need to approve a second $350 billion infusion into the so-called Troubled Asset Relief Program.
A Treasury official said last night that the government has not committed all of the money in the $250 billion pot set aside to make investments in financial institutions, so the Treasury has leeway to direct some of that cash to GMAC.
“It’s not fair to say we’ve overcommitted,” said the official, adding that many of the expected bank investments are still being reviewed by bank regulators.
To recap, the Bush Administration’s latest $6 billion bailout of GMAC, bringing the first round of the GM bailout total to $23.4 billion, pushes the total money committed by the Troubled Asset Relief Program past the initial $350 billion authorized by Congress. In other words, TARP now has now made specific promises to spend more money than it actually has the authority to spend. The bailout is now in need of a bailout.