TARP was drafted hastily and pushed through by threatening total collapse

Evidence

The intense sequence of events that transpired during the government takeover of Freddie Mac and Fannie Mae, the failure of Lehman Brothers, and the passage of the widely disparaged “bailout” or TARP legislation on October 3, 2008, has been related in fair detail in a number of books and articles; but one overlooked aspect has been the curious role of economists during its initial phases. Because it was largely conceived in haste in the crisis-consumed Treasury Department of Hank Paulson, the initial draft of a plan to purchase mortgage-backed securities, or, as we now know, the “toxic assets” of journalist parlance, the Treasury needed congressional approval to purchase up to $700 billion of these securities in the Paulson plan, so Paulson and Ben Bernanke sought to frighten the congressional leadership into hastily granting them this authority just before September 19, presenting them with a bald three-page proposal and Hobson’s choice: this, or the collapse of Western Civilization. — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 635

Categorization

• XREF: This is the canonical opening-act detail of the post-2008 austerity narrative; connects to the broader ‘thought collective’ story and to alternate accounts of the crisis as a manufactured panic.
• SEED: Angle: how the forced-binary ‘this or collapse of Western Civilization’ framing set the epistemic terms for everything economists could subsequently debate — the original sin that foreclosed alternatives.