Rep. Brad Sherman [D, CA-27] has big problems with Rep. Barney Frank’s [D, MA-4] “too big to fail” bill:

Let’s not Adopt TARP on Steroids

The new Resolution Authority, set forth in Treasury’s 253-page legislative draft of October 27, 2009 provides permanent, unlimited bailout authority. This means:

(1) Unprecedented powers for the executive to decide spending and taxes, without congressional approval; and

(2) Depending on the desires of the Executive Branch from time to time, the greatest transfer of money from the Treasury to Wall Street in U.S. history.

The Executive Branch may loan an unlimited amount to any solvent financial institution “if necessary to prevent financial instability” (§1109(a)), or to a troubled financial institution, the default of which would “have serious effects on economic condition in the United States (§1603(b)(2) and §1604©(1)). As to troubled firms, the bailout can also take the form of purchasing assets from the institution (§1604©(2)) or investing in the institution (§1604(b)(4)).

To Read the Full Statement please click here.