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How Does Sheila Bair Do It?

If you've been following the coverage of the administration's plans for financial market reform, you may have noticed two emerging themes: 1.) All the regulators not named Sheila Bair (the FDIC chairman) seem to dislike Sheila Bair and wish she had less authority. This nugget from yesterday's New York Times is typical:

But at the Treasury and the Federal Reserve, Ms. Bair is viewed as someone who pushes her and her agency’s interests rather than someone who finds common ground with other policy makers. Besides Mr. Dugan, she has antagonized many other leaders in Washington.

2.) Bair and the FDIC stand to gain a lot of authority under the administration's reform package--namely, the responsibility for "resolving" non-bank institutions (like AIG, or the holding companies that own big banks like Citigroup and Bank of America) that are on the verge of failing. See, for example, today's Journal:

The goal is to avoid repeating a situation akin to the collapse of Lehman Brothers Holdings Inc., where the government had no authority to smoothly unwind the failing institution. A step such as this is expected to be exercised only rarely, and it could first require approval by the Treasury Department, Federal Reserve, and FDIC, people familiar with the process said. Once a company is placed into receivership, the process will likely be run by the FDIC.

I have no axe to grind here either way--the couple of times I've seen/read about Bair interacting with reporters, she's seemed perfectly competent. But I don't know much of the backstory. The point is just that it's strange to give so much power to someone you think of as kind of a menace. The Times does say that part of her power comes from having Barney Frank and Chris Dodd as patrons, which is obviously important. But I don't think it quite suffices as an explanation. (It explains, for example, how she remains in her job, but not necessarily why the FDIC will end up with so much additional authority. Maybe committee chairmen always want the agencies they oversee to amass as much power as possible, but these guys also overesee some of her regulatory rivals, no?) Anyway, thoughts welcome.

--Noam Scheiber