Fair-Weather Unitarians

As Jack has recently observed ,apart from Katrina, the Iraq War and the conflict with al Qaeda, therehas hardly been a government challenge of greater enormity this decadethan the economic crisis we are now facing. Yet someone who is neitherelected nor politically accountable, Ben Bernanke, is making virtuallyall of the nation’s most momentous monetary decisions … and thereis little the President can do about it. (The President may not removemembers of the Board of the Federal Reserve except “for cause,” 12U.S.C. 242, which has long been understood to reflect congressionalintent that the President may not remove such officers merely becauseof a substantive disagreement with their particular monetarydecisions.) What’s more, virtually everyone in the Nation now acceptsthis as the Way Things Ought to Be and, truth be told, is grateful andrelieved that the President is not “the Decider” when it comes to thefate of our economy.

And what does the Bush Administration haveto say about this profound threat to the “unitary executive”?  After all, even with respect to the much-less-powerful Consumer Product Safety Commission, the Bush OLC (per John Yoo), wrote that a similar for-cause removal condition for CPSC Commissioners “could prove to be unconstitutional.”

Well, onMonday, the Administration’s Department of Treasury will “propose a far-reaching overhaul of the nation’s financial regulatorystructure that would reshape the relationship between Wall Street andWashington and redefine the responsibilities of some of the federalgovernment’s most powerful agencies.” In particular, and moststrikingly, the powers of the Federal Reserve would be dramatically expanded :the Fed “would gain the power to investigate any aspect of financialinstitutions that threatens the stability of the entire system,gathering information and taking action to combat risks to thefinancial system as a whole.” In the words of one Treasury official,the Fed “would act as a ‘free safety,’ … with broad but somewhatundefined powers to roam the entire playing field of Wall Street’sactivities.” 

Needless to say, the Administration has not – thus far – added that tis bold new proposal “could prove to be unconstitutional.”  The Blueprint for Monday’s statutory proposal does not even mention theapparent constitutional anomaly that these important functions would betransferred away from the control of the elected President and otherpolitically accountable officials.

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As Jack wrote :

Withinthe halls of the Bush Administration, nobody seems to be thumping thepulpit, arguing about the framers and demanding the sacred prerogativesof the Unitary Executive. Messrs. Cheney and Addington are nowhere tobe heard from defending the President’s powers to take responsibilityfor the money supply and for the financial crisis we are now in.President Bush doesn’t want the buck to stop in his office. He likesthe dictatorship of the Fed just fine. Of course, if the Fed were charged with interrogating prisoners, it would be a different matter entirely… .

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