U.S. Treasury shifts focus of credit bailout

Despite the mind-boggling amount of money that Congress has authorized the Treasury to spend — $350 billion immediately, and another $350 billion that Congress would approve under a fast-track procedure — Paulson is running short of money and time.


Treasury Secretary Henry Paulson Jr. announced at a news conference in Washington on Wednesday plans to create a consumer lending fraud fund. (Brendan Smialowski for The New York Times)

The Treasury has already committed about $290 billion. It has allocated $125 billion to the nine biggest American banks and investment banks; another $125 billion for publicly traded regional banks; and $40 billion to expand the existing bailout of American International Group, the insurance conglomerate that collapsed in September.

$700 billion just won't be enough to feed the locusts attracted to the bailout cornucopia.