The $700,000,000,000 question

I feel like I should write something about the proposed $700 billion government bailout of bad debt. (I was originally going to say "bad mortgage debt," but after lobbying from financial firms, the Bush Administration has apparently widened the proposal to include unsecured consumer debt as well.) Frankly, I don't like it. I'm not sure if we have any choice but to bail out these companies, but I still don't like it. To me this seems like yet another example of companies keeping the profits when things go well, then expecting taxpayers to pick up the tab when things go badly. For all that Republicans talk about wanting a hands-off free market, what they really work for is an environment where profits are privatized but downside risks are absorbed by the government.

I remain hopeful that the plan will be altered by Congress to provide more oversight, to enhance regulation to prevent this from happening again, and to ensure that CEOs don't get golden parachutes at taxpayer expense. Personally, I would also like to see limitations on how large financial firms are allowed to become. They shouldn't be allowed to grow to a size where failure would be so catastrophic that the government has no choice to bail them out.