The F.D.I.C. is insuring the program, called the Public-Private Investment Program, by using a special provision in its charter that allows it to take extraordinary steps when an "emergency determination by secretary of the Treasury" is made to mitigate "systemic risk."
Simple enough, but that language seems to bump up against another, perhaps more important provision. That provision clearly limits its ability to borrow, guarantee or take on obligations of more than $30 billion. [...] The exact legalistic language says that it "may not issue or incur any obligation" over that limit.
But a couple of thoughts on this.
First, I'm not sure what Sorkin means when he says the provision "clearly limits [the FDIC's] ability to borrow, guarantee or take on obligations of more than $30 billion." The FDIC obviously guarantees deposits that are vastly in excess of $30 billion -- indeed, the FDIC guarantees several trillion dollars in deposits. Sorkin is probably referring to the $30 billion limit on how much the FDIC can borrow from the Treasury. But it's not clear how the borrowing limit would affect the bank plan.
Second, I'm not sure the two charter provisions Sorkin cites really "bump up" against one another. If the administration is in fact invoking an "emergency determination" provision that lets them take "any action...necessary" to avoid systemic risk, then it's more like one provision trampling the other in a brawl. You might not think that's desirable, but "bump" doesn't seem like the right word.