In a shocking disregard for our Constitution, the Treasury is considering placing AIG in a conservatorship (a la Fan and Fred).
Think about that for a minute. The Treasury, without congressional approval, may take over a private enterprise. One that would put billions (trillions?) of dollars of liabilities on our Federal books. This is beyond scary. Where do they stop? Will they take Goldman? HSBC? That resteraunt down the road with the shitty service and terrible food?
And while we are on the subject of nationalization, why the hell would they consider nationalizing an insurance company of all things, yet they never talk about nationalizing something useful. Like say, nuclear power or oil companies. How can they (conservatives) look America in the face and say "Universal healthcare will ruin our country. BTW, we are going to take over these financial firms so we don't lose our shirts".
So Ms. Pelosi, and the rest of our congressional Democrats, here is your opportunity to show us you actually care about rule of law. If you won't move to impeach Bush, then impeach Paulson. If they actually attempt this, then we better see emergency proceedings to draw up articles of impeachment againt the Treasury Secretary. The law, the spirit of the Constitution, and most importantly, the people who vote for you, demand it.
UPDATE (6:31pm EST)
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I just saw this on Calculatedrisk.blogspot.com
Federal Reserve May Act Alone in Rescuing A.I.G.
A.I.G.’s collapse seemed so likely on Tuesday that the company hired the law firm Weil, Gotshal & Manges — which is also handling the Lehman Brothers bankruptcy — to draw up bankruptcy papers.
Many of A.I.G.’s subsidiaries have drawn down on their credit lines, people briefed on the matter said.
Yikes! This is the end folks. It's either bailout, illegal conservatorship, or the financial Armageddon of 2008.