New Terrain for Panel on Bailout

[groovedaddy]

WASHINGTON — There was a rare moment of levity at the Treasury Department on Friday as the children of government workers scampered from office to office in Halloween costumes. A few minutes later, the children were gone and the hallways were retaken by grim-faced grown-ups — handing out tricks and treats of a different sort.

The Treasury building is ground zero for the Bush administration’s $700 billion rescue of the financial system — an ambitious, increasingly embattled program that passed an early milestone last week when the government wired the first $125 billion to the nine largest banks in the United States.

Having been handed vast authority and almost no restrictions in the bailout law that Congress passed a month ago, a committee of five little-known government officials, aided by a bare-bones staff of 40, is picking winners and losers among thousands of banks, savings and loans, insurers and other institutions.

It is new and unfamiliar terrain for the officials, who are making monumental decisions — a form of industrial policy, some critics say — that contradict the free market philosophy they usually espouse. Predictably, the process is stirring alarm from Capitol Hill to Wall Street.

http://www.nytimes.com/2008/11/04/business/economy/04bailout.html?th&emc=th