Lawless Policy: TARP as Congressional Failure

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The U.S. Constitution vests all the "legislativepowers" it grants in Congress. The SupremeCourt allows Congress to delegate some authorityto executive officials provided an "intelligible principle"guides such transfers. Congress quicklywrote and enacted the Emergency EconomicStabilization Act of 2008 in response to a financialcrisis. The law authorized the secretary of theTreasury to spend up to $700 billion purchasingtroubled mortgage assets or any financial instrumentin order to attain 13 different goals. Most ofthese goals lacked any concrete meaning, andCongress did not establish any priorities amongthem. As a result, Congress lost control of theimplementation of the law and unconstitutionallydelegated its powers to the Treasury secretary.Congress also failed in the case of EESA to meet itsconstitutional obligations to deliberate, to checkthe other branches of government, or to beaccountable to the American people. The implementationof EESA showed Congress to be largelyirrelevant to policymaking by the Treasury secretary.These failures of Congress indicate that thecurrent Supreme Court doctrine validating delegationof legislative powers should be revised toprotect the rule of law and separation of powers.