Tuesday, September 23, 2008

Bad Bet


The Bush Administration bet the ranch – and a lot of peoples’ homes – that the market could deal with all problems. Folks would borrow; firms would lend; houses would be built. No problem.

Now we know that the market failed – and failed spectacularly.

But every step of the way – even when some called for more regulation – the party line was: “No regulation.”

Instead, as the crisis loomed, the administration doubled down and let the situation run: Bear Stearns, Merrill, Fannie & Freddie, Lehmann, AIG.

Now we’re at the end of the road. No more pretending. It’s bailout or bust.

Government regulation may not always be the answer, but a little more of it would have helped this time.

© 2008 Michael B. Lehmann

No comments: