Saturday, September 20, 2008

More Thoughts on the 1 Trillion Dollar Bailout

I have a basic problem with the notion of spending upwards to a $1 trillion (I think the proposed number is $700 billion right now) to bail out the top .01 percent of the income distribution. If we are going to piss away a trillion dollars to maintain employment and boost asset prices let's do so from the bottom up: fixing bridges, building transit, job retraining, etc. Yes, more financial institutions would fail; however, I am afraid they should. If we do this bailout this will simply be the biggest bailout of all times till the next one around the corner.

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