Recall the problem after 9-11: There was fast action, poorly defined roles, and little Congressional interest in challenging unconstitutional conduct or dubious information.

Post 9-11: We (re)learned when government officials make excuses to ignore the law -- law, as a lesson of history to apply, going forward --  we have a recipe for a disaster.

The same is happening with the auto bailout. Washington is on the verge of bailing out the auto industry using worthless information, and poorly defined authority:

NYT: "I have a banking staffer who can carry out the responsibilities of this so-called czar," Mr. Corker said. "I mean it's a liaison. This person has no power."

As after 9-11, we've got in this (auto) bailout: Vague information, demands for fast action, and dubious accountability. Despite the smokescreen of these defects, who reviewed whether this bailout was constitutional?

This is starting to smell like the National Recovery Administration, which the Supreme Court declared unconstitutional because it violated the Separation of Powers [emphasis added]:

"Extraordinary conditions, such as an economic crisis, may call for extraordinary remedies, but they can not create or enlarge constitutional power. . . . In the final analysis the contention made rests upon a non-existent power in the Federal Government to enact any act deemed by it necessary or desirable to promote the general welfare. " [ Schechter Poultry v. US, 295 U.S. 495, ]

The judicial admonishment on the economic front mirrors the caution on the national security front:

"A state of war is not a blank check for the President when it comes to the rights of the Nation's citizens." (Justice O'Conner, Hamdi, 542 U.S. 507, relying on Youngstown 343 U.S. 579)

Part I: Congressional Track Record of Failed Oversight

Recall how long it took for Congress and the President to get a wakeup call: A national crisis is not an excuse to abuse power, nor engage in irresponsible conduct. The current plan is a recipie for more post 9-11 irresponsibility. Indeed, although the "extraordinary" conditions of 9-11 similarly did not justify violating FISA, Geneva, or the US Constitution, Congress turned a blind eye to the (illegally) Presidentially-contracted abuses.

Congress cannot do quickly what it cannot do slowly

For seven (7) years, Congress has been reluctant, if not unwilling and incapable, of conducting oversight during wartime. There's little prospect they've reformed this oversight or are ready to apply it to a financial crisis, already dwarfing in a few short months the cost of a multi-year war.

Smokescreen to corporate and government accountability

Remember the "We're in the post 9-11 era"-argument? It was a pretext, going forward, to argue that the law, Constitution, FISA, and Geneva did not apply. 

With the bailout, the auto executives have an illusory line in the sand, arguing, "We've started over. After the bailout, we cannot be held accountable because we're operating in a new environment."

Implications of Not Conducting An Impeachment Investigation

Congress did not challenge -- and has not challenged -- this mythology with the (needed) impeachment investigation.  The failure of Congress to go through this difficult process illustrates the connection between the breakdown in the economic and legal sectors; and the dimming prospects these lessons will be applied to emerging issues. We have more excuses to make new excuses.

Federal Government Recklessness Thwarts State Officials

The problem with this provision is that state governments, not the Federal government currently oversee the auto industry board of directors:

NYT: "In exchange for the loans, the auto manufacturers would have to submit to strict government oversight and carry out sweeping reorganization plans."

Yet, the feedback on the bailout from the GAO and the oversight committee is that Congress and the President are not jointly working to take their obligations seriously. Not only are they operating outside the Constitution, Congress and the President are not bound to any financial performance standard. They're repeating the same problems behind the decisions creating the financial crisis and the poor auto industry performance.

FISA, Geneva, and Auto Bialout: US Government Had Meddled Without Accountability:

A. The auto industry executives cannot be removed by the voters;

B. The Congress and President, if the auto industry executives fail, cannot be removed for the bad financial results;

C. The State regulators could, as with the FISA immunity deal, be thwarted from enforcing state laws against auto executives for possible malfeasance prompting the Federal bailout

The state regulators, attorney generals, and legislators have cause for concern. Congress did not adequately deal with the conflict when State Attorney Generals raised privacy concerns over FISA. The State AGs had to, in effect, litigate their way back into the regulatory regime, and challenge the illegal activity. With the auto bailout, the question will be how the existing state level regulations on the board of directors will or will not get "trumped" by the new federal rules.

The vague Federal Government bailout-oversight plans cannot possibly be harmonized with the state-level regulations.

Part II: Congress, Contractors Shifting Risks To Public

The idea of the Constitution was to provide for the common welfare. The US government and contractors since 2001 appear to have turned this on its head: When caught with their pants down, they're shifting the problem to the public.

The auto industry bailout should be reviewed, in part, in the context of what we've learned since 2001. After 9-11 we learned contractors connected with the NSA, DoJ, and DoD would exploit the situation, abuse power, engage in illegal activity, and hide behind the Federal government.

This is not a narrow issue of executive abuse of power. The US government does not have a strong record of legal compliance or enforcement. If there is wrong doing within the government -- in Congress, for failing to ensure there was adequate regulation of the auto industry -- then providing a bailout on top of that failed oversight will muddy the waters.

This is not a unique interest of the Federal government or contractors, but should be a concern to the public. DoD contractors violated the FISA and Geneva; and the "punishment" Congress gave them was "FISA immunity". Indeed, despite allegations of war crimes against civilians in Iraq, Congress agreed to refuse to permit the Iraqis to exercise jurisdiction over US combat forces.

It remains to be understood how, as was done after 9-11, the auto industry might take their turn at the trough labeled, "Abuse the American Public, and Blame Them for Challenging That Abuse." Congress has not provided any hint that it's gleaned the lessons post-9-11; nor has it adequately discussed how failed legal compliance within FISA or the NSLs will magically reform itself behind the Treasury curtains.

We need to understand to what extent, in the "impeachment investigations are off the table"-regeime, that the Congress failed to conduct oversight into the national security issues related to a (supposed) collapse of the auto industry. The public needs to discuss what other oversight issues Congress has taken off the table; and explore the real long-term costs of the failures of oversight since 2001.

Part III: The Problem of Worthless Information

Our beef with the auto bialout plan is the failure to differentiate between (a) economic losses due to the economic downturn; and (b) the ongoing performance problems in the auto companies unrelated to the downturn. Congress and the auto executives needs to do something more than "liaise using worthless information."

The poultry case [ 295 U.S. 495] raises questions about the Congress' auto industry bailiout:

"Congress has set up no intelligible policies to govern the President, no standards to guide and restrict his action, and no procedure for making determinations in conformity with due process of law.

"When Congress has prescribed (1) a reasonably inteligible [stet] policy; (2) a reasonably definite standard for administrative action in carrying out that policy, and (3) an administrative procedure complying with the requirements of due process of law, administrative action in accordance therewith does not involve any unconstitutional exercise of legislative power.

Without adequate information, we question whether Congress has any basis for any policy, not to metion whether that policyis intelligible or constitutional.

The companies have the responsibility to know which economic problems requiring a bailout are related to inherent performance problems or "transitory" external factors in the current financial crisis. Without knowing the difference and being forced to present this analysis to Congress, the auto executive are positioning themselves to throw money at a poorly understood problem. That is not the making of a credible restructuring, but rewarding executives who refuse to adjust to reality.

Part IV: The Violation of Separation of Powers

Congress appears to be positioning itself to act as a defacto bankruptcy oversight committee, bypassing the Bankruptcy court. Congress needs this information to be able to adequately oversee the auto industry's planned use of these funds. There's little sense in sending more "bad money after bad."

Is Congress, in circumventing the bankruptcy laws, exercising judicial power? Congress has the power to only make laws, as distinguished from rules:

A 1 S 8: "To establish a uniform rule of naturalization, and uniform laws on the subject of bankruptcies throughout the United States"

Unlike the National Recovery Act which unconstitutionally delegated legislative power to the President; the Congress with this bailout appears to have delegated to itself judicial power to determine "whatever it does" is acceptable. 

This pattern is similar to the unconstitutional FISA immunity act. Congress illegally attempted to decide the outcome of pending litigation by declaring the FISA violations could not be enforce against the telecoms.

The money will be spent before the courts have time to review the Congressional action; or recovery from the auto companies the funds Congress may have illegally provided. Once these companies are in bankruptcy, the public  and the United States will not have a special position to recover any funds. That is, unless Congress (illegally) changes those rules again, as they did with FISA and Geneva.

Congress needs to coherently explain to constituents:

A. Why the laws related to bankruptcy are not being uniformly applied through the bankruptcy courts;

B. Why the auto industry is being given special immunity to the bankruptcy court, outside the "uniform" standard in the Constitution; and

C. Why the Act of Congress to bypass these uniform law is constituional, and not an illegal exercise of judicial power by the legislature.

Part V: Blurring Lines Between Commercial Profits, Federal Government Authority

If Congress wants to get in the business of regulating a business (not commerce) within a state, Congress needs to make the case that it is properly exercising authority under the Constitution. Congress has a real power to provide the transportation fleet with spare parts:

A I S 8: "To raise and support armies"

The auto industry profits are not a federal concern. The auto companies are regulated by the states as state commercial entities. Congress has the power to regulate commerce, but no power to conduct business:

A 1 S 8: "To regulate commerce with foreign nations, and among the several states, and with the Indian tribes"

Similarly, the Supreme Court in the poultry decision distinguished between direct and indirect effects:

Wiki: "The Court distinguished between direct effects on interstate commerce, which Congress could lawfully regulate, and indirect, which were purely matters of state law."

The trap the US government finds itself:

A. Unconstitutional Activity

If there are gaps in state laws, and the auto industry is an important national resource, then the Federal Government must ask We the People for the non-delegated power to manage firms, not just regulate them.

B. Malfeasance

Conversely, if the Congress and President argue that they have this "inherent" power to bailout the auto industry for national security objectives, then they must explain why they have taken this long to wake up to something they "inherently" should have been monitoring since 2001 if not earlier.

C. Scope of Financial Crisis

If, as Congress might have us believe -- that they were surprised, as "B" does not apply -- we have to consider what else they've missed, or not publicly acknowledged. What else is brewing? If the US government wants national support, it needs to keep the public involved with the discussions to solve the real problem.

Part VI: DoD Should Have A Backup Plan To Provide Parts To Transportation Fleet

Let's suppose for the sake of discussion that the auto companies are on the verge of a collapse; that parts suppliers will go out of business, that key parts will not be available to keep the transportation fleet rolling.

This risk should have been known and well discussed inside DoD. We need to see those risk assessments, and understand what DoD plans to do to continue combat operations should the auto companies, in fact, go out of business; and the parts are not available to support the defense industry.

However, if we're told that the information DoD has does not support a concern about any impact on Defense operations, we have to reconsider whether there really is a national security issue behind Congressional moves.

DoD should have well known going forward from the 1980s and 1990s that there was a national security issue. There should have been plans in place to bridge this problem should, as was likely raised inside DoD, the auto parts suppliers fail.

If the auto companies cannot make the case that their collapse and/or bankruptcy will not have a material impact on American national security, then the companies must admit that the prospect the US commercial sector might depend on foreign autos is unrelated to a national security issue.

It might be preferable to have a domestic commercial auto industry. The question is whether Congress is providing hidden subsidies to the auto industries so they can continue expanding overseas, capturing market share despite the lengthening returns on investment. The shareholders did not vote for Members of Congress to be the board of directors for the auto industry.

DoD needs to disclose to Congress what it's real backup plans are should the auto industry collapse; and parts suppliers cannot provide military supplies to the DoD transportation fleet.  Congress' concern is whether the auto industry, if it collapses, would have an impact on the Defense Department. 

Indeed, if Congress relies on worthless information to provide a bailout, the "staff" is certainty going to get more worthless information on progress along that plan. This challenge will become more complex if Congress cannot differentiate between performance and economic problems.

Congress needs to explain to constituents:

A. Why the auto industry collapse was not adequately managed with the legislative power of Congress to "support the army";

B. How long Congress has known that a collapse of the auto industry would affect the ability of the United States to wage combat

C. Discuss why it required a financial crisis to prompt Congressional attention and action, and the auto industry did not work with the DoD officials to ensure there were adequate federal plans in place to provide needed supplies for national defense.