Is the Obama Administration Browsing Blogs for Policy Ideas?

I was belatedly reading at a discussion on Money Law, about the AIG bailout/bonus brouhaha. One of the comments linked to another blog, ButAsForMe.Com, with a posting about the car rental industry jockeying for TARP money. A clause in some legislation in January that amended TARP apparently makes car rental companies eligible for these loans (and, yes, as many commentators have pointed out, much of these “bailouts” are, as I understand it, loans that will eventually have to be paid back by these companies).

This piece at ButAsForMe.Com, posted on February 25, mainly discusses whether Enterprise Rental actually laid off the 2000 employees they said they did when they went begging for their share of the TARP pie. I didn’t read it until this weekend, but what stood out in my mind was this line:

Enterprise successfully argued you can help Detroit by giving loans to end-users. They said they deserve a bailout because they buy a lot of cars and will help the automakers through their own purchases. By following that flow of logic, everyone in the United States should be eligible for a government backed loan to buy a car. (Emphasis added)

The “[b]y following that flow of logic” line is, I guess, meant to be a bit of reductio ad absurdum, the absurd bit being “government backed loan[s] to buy a car”! Hahaha - how ridiculous!!! Even the Obama administration wouldn’t go THAT far, would they?

The reason that line stood out is I had just watched the Leno/Obama gabfest on our DVR. I had to check the transcript, but this story reminded me of something the President said:

In the meantime, we're taking a lot of steps to, for example, opening up -- open up separate credit lines outside of banks for small businesses so that they can get credit -- because there are a lot of small businesses out here who are just barely hanging on. Their credit lines are starting to be cut.

We're trying to set up a securitized market for student loans and auto loans outside of the banking system. (Emphasis added)

I guess its not so ridiculous because the President said it less than three weeks after the ButAsForMe.Com blogger used this as a theoretical absurdity to argue against allowing any company that has to buy cars as part of its business to use TARP money to do so. So the President says that they’re trying to set up a system under which we can all be eligible for a government backed loan to buy a car: good-bye, auto financing industry, or at least a big chunk of it, right? There goes another large segment of our economy usurped by the feds. But its early in the Obama administration and a lot of what they’re throwing up against the wall is not going to stick.

The moral of this story is: be careful what you blog about, for it might come true. Or don’t be careful if you have a wishlist of government entitlements - the administration may be trolling the blogosphere for ideas they hadn’t thought of already. Government-backed car loans! Ha - that is as absurd as the federal government setting up its own chain of check-cashing payday-loan stores! (Posted March 22, 2009; I’m hoping it becomes an official government proposal by mid-April - those 30% fees at Check-N-Go are killing me! Please, President Obama - cap all payday loans at 1% over prime! That’s fair, right?)