Hoping for reverse gridlock: special bailout edition
I cannot believe that I sit here today hoping for a Democratic Congress to somehow stop a Republican administration from effectively fully nationalizing our financial services industry.
Holy Crap, if we are going to nationalize something, lets at least be as smart as Chavez and Morales and pick stuff that is profitable! Lets nationalize Google and Microsoft!
For what it's worth, I think this plan is a hasty, ill-considered overreaction to recent events. If it's a cure, then the cure is worse than the disease. Once a bailout like this happens it will be (1) very hard to say no to anyone down the line and (2) very hard to deny politicians a much increased voice in the everyday activities of firms if taxpayers are going to be the ultimate owners when things go bad.
Here are words of wisdom from Luigi Zingales. Greg Mankiw provides this link that is well worth reading. Here is a bunch of people more famous than me chattering on the topic.
This is a very bad business.