It is a complete take over of the US economy giving the unelected Paulson and his elite banker buddies dictatorial powers. And putting the US taxpayer on the hook to bail out irresponsible borrowers and lenders across the globe. It is immoral, unconstitutional, and doomed to fail in everything except the increase of government power.

There may be good temporary reasons for the bailout associated with preventing the collapse of the financial system (and destroying value by stopping a going concern) but I don’t think Paulson and friends are in a position to make the case. They belong to a fraternity whose existential interests are threatened and have an inherent conflict of interest. Any solution to the financial crisis must do two things: buy the system time to write down worthless paper in an orderly way; and bankrupt the people who made bad management choices. Bailing out the institution (and the people) who generated these losses means they can repeat the fiasco again. They’ve struck out and should leave the field.

But this is a situation for oversight, if any, yet I’m worried that the overseers are no better themselves than what they have oversight of. Just how much wisdom Congress will bring … Part of the problem of the last decade is that regulation has often meant enforcing compliance. I’ve heard that a considerble effort in many companies is eaten up by checking boxes rather than making good business decisions. I’ve heard that a lot of consulting work is geared towards keeping things compliant rather than profitable. Enacting regulation is like deputizing a private sector employee to work as a bureaucrat. While you may theoretically work for a company, you really carrying out a regulatory function.

So while I think there may be some rational reason for a temporary bailout; I’m not confident that the foxes can be left in charge of the chicken coop or that bringing in more oversight won’t just include the weasels and stoats too.