Bankruptcy, not bailout, is the right answer

Her comes Jeffrey Miron an oxymoronically placed libertarian economist from harvard, with this OpEd being carried by CNN! Phew! It almost boggles the mind that this saw the light of day. FINALLY someone has cut through the crap and reached the root of the matter. We should be so lucky that our legislooters of both parties could (or would) think so clearly

Congress has balked at the Bush administration’s proposed $700 billion bailout of Wall Street. Under this plan, the Treasury would have bought the “troubled assets” of financial institutions in an attempt to avoid economic meltdown. This bailout was a terrible idea. Here’s why.

The current mess would never have occurred in the absence of ill-conceived federal policies. The federal government chartered Fannie Mae in 1938 and Freddie Mac in 1970; these two mortgage lending institutions are at the center of the crisis. The government implicitly promised these institutions that it would make good on their debts, so Fannie and Freddie took on huge amounts of excessive risk.

He goes on with far more reason than is found in either (or both) houses of Congress.

It’s a refreshing change!