Cincinnatus v. Caesar

The Romans had a provision for a six-month dictator who was appointed in the case of an emergency and had near absolute power. The ideal was Cincinnatus who was called from his ploughing to become dictator and save the Roman army trapped by the Aequians. Although appointed to a six-months term, he won the war in sixteen days and resigned.

On the other hand, after crossing the Rubricon in defiance of Roman law and seizing control of Rome itself, Julius Caesar proclaimed himself dictator perpetuo and held the office until removed by less voluntary means.

There is no question that the Feds have crossed the Rubicorn and now the battle is to insure a dictator and not a dictator perpetuo. And that is why the bill proposed by Paulson will never pass as written. It grants the Secretary of Treasury unlimited, unsupervised, unaccountable control of $700 billion of tax payers money to be used to punish, reward, and manipulate the financial industry however he or she sees fit. And that he or she is extremely important as we do not know today who will be wielding this power come January. So both Left and Right, Democrat and Republican will fight for restrictions – at least until they know if they won the election.

So expect a more limited bill with Congressional oversight, sunset provisions, some pre-ordained punishment for senior management of participating firms, help to Main Street as well as Wall Street. The three page law will end up more like 10 to 15 or even 20 pages with short-leash provisions. But then Paulson didn’t become Chairman of Goldman Sachs by not knowing politics. By setting the terms of the debate so far to one side, he knows that he will end up a lot closer to dictator than if he had started with a bill that had a chance to pass.