This is not a new question.  The fund that the Daily Caller rightly reports as a potential American taxpayer bailout got created in 2009 as part of the legislation that also launched Cash for Clunkers, the notoriously failed effort that wasted $3 billion more by subsidizing car sales that would have taken place anyway while destroying legitimate used vehicles and making it harder for lower-income families to buy their own car.  So far, the IMF has not tapped this reserve for either the EU or Iran, but that could change quickly as the debt crisis in Greece and Italy grows:

When California Democratic Rep. Nancy Pelosi was the Speaker of the House in 2009, President Barack Obama and congressional Democrats authorized $100 billion in spending as a line of credit for the International Monetary Fund to be used in times of emergency — funds that could now be used to bail out European banks.

As the Eurozone takes a turn for the worse and chatter heats up about more European Union and IMF bailouts across the continent, Republicans in Congress are pushing to rescind the $100 billion set-aside.

That $100 billion is an addition to the $64.4 billion the U.S. Treasury will provide in quotas to the IMF this year. That new funding has not been formally appropriated, but the IMF could request the money whenever it pleases.

Washington Republican Rep. Cathy McMorris Rodgers, who has led the fight in Congress against providing a European bailout with U.S. taxpayer cash, told The Daily Caller that this $100 billion line of credit received some attention — but not nearly enough — when it was created in 2009.

“It was attached to another bill and it was part of funding for defense,” McMorris Rodgers told The Daily Caller in a phone interview. “There were some concerns raised at the time, and every single Republican had voted against this authorization of an additional $100 billion for the line of credit.”

Erick Erickson at RedState tried to lead the charge against the $100 billion line of credit for the IMF, but at the time, Republicans had little leverage in Congress.  Democrats were about to get their 60th Senate seat as the challenge to Al Franken’s election in Minnesota concluded, and Nancy Pelosi locked Republicans out of bill-drafting in the House altogether.  A handful of Blue Dog Democrats opposed the idea of extending bailouts to the EU, but not enough to block the progress of the amendment to the defense appropriation, especially after Pelosi and Harry Reid added the Cash for Clunkers program to it.

If we had a balanced budget or a surplus with spending under control, this might not have been a bad idea.  Even with the credit line of $100 billion, it’s arguably a qualified risk worth taking in order to prop up the Western economy — if we were healthy enough to take that risk.  However, we’re already borrowing $1500 billion to cover our own fiscal disorder every year, which means that we would have to borrow the money to loan to the IMF.  The entire idea is absurd, and it highlights the need to get our own balance sheet in order before helping others who have it worse.

Now we are left with a commitment to the IMF that will almost certainly get called if the EU can’t fix its own house, and which Republicans will have difficulty blocking.  The House can pass a bill to rescind the credit line, or attach an amendment to a bill that Obama particularly needs, but the Senate can detach it, too.  If not, Obama could veto a bill that contains the repeal, although if it passed the Senate, that would be very risky indeed.  In order to press forward to rescind the line of credit, Republicans will need to emphasize that Obama is now planning to put American taxpayers on the hook not for a bailout of American financial institutions, but for foreign banks and financial companies.  Given the eruption of anti-bailout sentiment across the political spectrum (in both the Tea Party and Occupy movements), allowing this to go forward would be almost certain political suicide.