Maybe commenter Phil had the right idea after all. Since the government is bound to foul up even the best plan when it involves too much money and power, doing nothing might have been the better course. We had a liquidity crisis from which we probably could have recovered with relative ease had the government bought up massive amounts of undervalued bank debt and sold it at a profit when stability returned. That would have been a $700 million investment, not a bailout.
Instead, we're all but nationalizing our banks, and now Paulson wants to turn this into a bona fide bailout, pouring money into credit card debt, which must be the worst possible kind short of getting involved with a Mafia moneylender. (A friend's credit card company, which recently raised his interest rate to thirty-four percent, might be taking lessons from the Mafia, except that his kneecaps are still intact.) I know we can't change immediately from a society based on massive debt to something more sane, but do we have to discourage reasonable behavior?
It's like Florida taxing people who know better than to build high-rise condominiums on the beach to support those who don't care if a hurricane blows down the building as long as the state continues to underwrite insurance for them.
