Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
Display:
Op-Ed Columnist - Cash for Trash - Op-Ed - NYTimes.com

The logic of the crisis seems to call for an intervention, not at step 4, but at step 2: the financial system needs more capital. And if the government is going to provide capital to financial firms, it should get what people who provide capital are entitled to -- a share in ownership, so that all the gains if the rescue plan works don't go to the people who made the mess in the first place.

That's what happened in the savings and loan crisis: the feds took over ownership of the bad banks, not just their bad assets. It's also what happened with Fannie and Freddie. (And by the way, that rescue has done what it was supposed to. Mortgage interest rates have come down sharply since the federal takeover.)

But Mr. Paulson insists that he wants a "clean" plan. "Clean," in this context, means a taxpayer-financed bailout with no strings attached -- no quid pro quo on the part of those being bailed out. Why is that a good thing? Add to this the fact that Mr. Paulson is also demanding dictatorial authority, plus immunity from review "by any court of law or any administrative agency," and this adds up to an unacceptable proposal.



Point n'est besoin d'espérer pour entreprendre, ni de réussir pour persévérer. - Charles le Téméraire
by marco on Mon Sep 22nd, 2008 at 03:47:12 AM EST
[ Parent ]

Others have rated this comment as follows:

Display:

Top Diaries

Italian government collapse

by IdiotSavant - Jan 15
14 comments

Dutch Government Collapse

by Oui - Jan 16
4 comments

A Rush To Judgement Day

by Oui - Jan 17
1 comment

A Long War?

by Frank Schnittger - Jan 8
77 comments

Israel and A Presidential Election

by Oui - Jan 14
24 comments

Occasional Series