David Leonhardt of New York Times suggests of 2 kinds of government takeover of US banks:
One is premised on ideology-governments can run more institutions more "justly" or "efficiently" than private capitalists.
One is premised on ideology-governments can run more institutions more "justly" or "efficiently" than private capitalists.
The second is predicated on short term expediency: government takes over (sheds shareholders, bondholders and management), repackage (segregate assets) and immediately sells back to the public.
And if the path of government action are to be based on public opinion, then the the second option appears as the proximate direction. This supposedly is the optimistic case.
But, as Ludwig von Mises once admonished, interventionism can be addictive, ``It doesn't accomplish its stated ends. Instead it distorts the market. That distortion cries out for a fix. The fix can consist in pulling back and freeing the market or taking further steps toward intervention. The State nearly always chooses the latter course, unless forced to do otherwise. The result is more distortion, leading eventually, by small steps, toward ever more nationalization and its attendant stagnation and bankruptcy."
Despite the denials of key officials, apparently the baby steps are headed towards such direction.
And if the path of government action are to be based on public opinion, then the the second option appears as the proximate direction. This supposedly is the optimistic case.
But, as Ludwig von Mises once admonished, interventionism can be addictive, ``It doesn't accomplish its stated ends. Instead it distorts the market. That distortion cries out for a fix. The fix can consist in pulling back and freeing the market or taking further steps toward intervention. The State nearly always chooses the latter course, unless forced to do otherwise. The result is more distortion, leading eventually, by small steps, toward ever more nationalization and its attendant stagnation and bankruptcy."
Despite the denials of key officials, apparently the baby steps are headed towards such direction.
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