I hear that there’s a WaPo article on this, but I’m not a subscriber (all I could find was this Bloomberg video). Apparently Secretary Paulson has pledged almost $10 billion more than he’s been allocated. This bothers me. He claimed he wasn’t going to ask Congress for the additional funds, leaving that task to his replacement. He’s promised money that he isn’t legally authorized to spend.

This isn’t a budget problem—there’s a good chance that Congress would have approved the money if asked, and there’s a good chance that his replacement would have made the same allocations if he had waited. The money will most likely be approved by Congress by the time it actually gets spent. The issue is that the TARP bill was drafted in such a way that Paulson requires Congressional approval to go beyond his initial spending limit. He ignored that restriction. This is a purely academic scenario, but what would happen if Congress didn’t approve the next $350 billion?

Also, does anyone remember when $10 billion was a lot of money?