Fair enough, Allan. But I would just caution all Piggs that most of the population of the US is hooked on the dream of becoming wealthy via inflation of the prices of assets bought with other people’s money. That creates a tremendous incentive for even intelligent and good people to ‘buy in’ to any plausible theory that tries to keep them in the dream little longer, or at least rescues them from the full consequences of their bad personal choices.
So we are getting, from all directions and in tremendous volumes, support for the bailouts. Maybe the bailouts really are the best course of action, but I am very suspicious of ‘free lunch’ solutions, ones that evade personal responsibility for past actions, the madness of crowds and, above all, motives. As in solving any crime, you can often figure things out best just by following who gets the money, not by listening to the clever stories that people weave for their own ends.
The lesson I draw from what is happening is that my worst fears of the country’s people and politicians is realized. When next I have a chance to ‘screw the system’ for my personal enrichment, I will take full advantage of it. Maybe I am just an insignificant element of the population, but if a lot of people like me, who have never before tried to avoid paying taxes and debts, instead work the system from every angle, maybe there won’t be a system. I doubt Larry Summers is calculating in the cost of the bailouts any large impact from that. I hope he’s right, but he might be wrong. He’s smart, but he’s not a genius.
