Today's Outrage: Why Is CIT Too Small to Save?

Today's Outrage is published weekdays at 9:30 a.m. EDT and is available as an RSS feed.

One of the great questions about the financial bailout has been answered. We now know how small is too small to merit a taxpayer-financed rescue.

CIT ( CIT) is that small.

The commercial lender appears to be headed for bankruptcy after failing to persuade the Obama administration that it deserves a helping hand. Hard to believe that government largesse actually has a limit, but there's the proof.

The Treasury Department went so far as to issue a statement saying it needs to keep the threshold high for exceptional aid to individual companies. Halleluiah! The government found financial religion at last.

The bad news, though, is that CIT is one of the biggest providers of loans to small-business in this country. How easily we forget that small business is a vital piston in our economic engine. We'll have to trust that other lenders will be willing to take the risks of financing the smaller ventures that create so many jobs and contribute so much to our nation's vitality.

This is quite the conundrum for Obama. On the one hand, he needs to show that he won't just throw taxpayer money around wantonly. On the other hand, this new restraint suggests that he only cares about big business.

Is that all we want in this country -- a bunch of Wal-Marts ( WMT), Best Buys ( BBY), Starbucks ( SBUX) and Krogers ( KR)?

Getting back to the government's line in the sand on bailouts, I don't really understand Obama's position on big banks.

He's made it clear that he doesn't like the fact that Goldman Sachs ( GS), JPMorgan Chase ( JPM), Bank of America ( BAC), Citigroup ( C) and many of the other TARP babies are so large that they pose a systemic risk to the financial markets.

He wants to regulate them down to size with onerous restrictions that make it less desirable for any single bank to be so critical that its failure would wreak havoc on the economy.

Yet now he's taking a stand against smaller banks too.

There are so many contradictions emerging from this CIT story that I'm not sure which part is more outrageous.

What do you think?

You can offer your perspective by sending an email to the editor.

Glenn Hall is the editor of TheStreet.com. Previously, he served as deputy editor and chief innovation officer at The Orange County Register and as a news manager at Bloomberg News in Frankfurt, Amsterdam and Washington, D.C. As a reporter, he covered business and financial markets, worked in both print and television in the U.S. and Europe, and conducted in-depth investigative coverage at The Journal-Gazette in Fort Wayne, Ind. His work also has been published in a variety of newspapers including The Wall Street Journal, The New York Times and International Herald Tribune. Hall received a bachelor's degree in journalism and political science from The Ohio State University and a certificate in project and program management from Boston University.

More from Opinion

Tuesday Turnaround: Micron, Autonomous Driving, and J.C. Penney

Tuesday Turnaround: Micron, Autonomous Driving, and J.C. Penney

Cable Stock Investors Should Keep an Eye On Wireless Broadband's Rise

Cable Stock Investors Should Keep an Eye On Wireless Broadband's Rise

Trump Blinks on China Trade War That's Looking Harder to Win

Trump Blinks on China Trade War That's Looking Harder to Win

Monday Madness: GE, China, and Micron

Monday Madness: GE, China, and Micron

Attention 60 Minutes: Google Isn't the Only Big-Tech Monopoly

Attention 60 Minutes: Google Isn't the Only Big-Tech Monopoly