At this point it’s hard even for supporters of the original bailout plan, like myself, to keep faith in Hank Paulson and the Treasury. As all the papers are reporting this morning, Paulson has officially scrapped the original plan for the congressionally approved $700 billion--namely, buying troubled assets from banks--in favor of buying stock in banks, thrifts, and, increasingly, bank holding companies, a broad category that includes everything from AmEx to automakers (of course, he refuses to extend a hand to Detroit). To his credit, he appears to be considering a plan to inject money into the consumer debt sector, but the details remain to be seen.

The problem is that Paulson has yet to explain why his game-changing moves were necessary, and he has yet to set up the mandated oversight office that could force him to do so (for more on that little slip up, read all--all--of this great Washington Post piece). What’s wrong with buying troubled assets, and why is it better to buy stock directly? Why bailout AIG but not GM? There are perfectly persuasive answers, even obvious ones, but Paulson has yet to float any of them. He simply says, haughtily, “I will never apologize for changing the approach and the strategy when the facts change.” But he’s never explained what changed: Why did he decide, on day one, that buying troubled assets was a bad idea, after lobbying so hard for the power to do just that? And by what metric does he think buying stock directly is a better idea? Credit isn’t coming unstuck, and the market continues to tank. And why is this a better move than aid to homeowners--which was an explicit, if poorly detailed, plank in the original bill? In these times, who’s surprised that John Boehner is the voice of reason? The House Republican leader told the Financial Times, “Transparency is even more important now, given that the program appears to have been implemented in some ways that were given little to no discussion as Congress was being urged to pass the rescue plan.”

Unfortunately, without that transparency, the upshot is a loss of faith in Paulson: Either he’s in the tank with banking-sector lobbyists--who, as the New York Times reported, have launched an obscenely large campaign over the last month--or he’s clueless as to the proper response to the continuing crisis.

--Clay Risen