Comment & Debate
Former senior Bush administration official. – “How you can let these guys design this program…? Of course there’s going to be a blowback… You don’t make yourself vulnerable to being called a tool of Wall Street.”[1]
Daniel Mitchell, a senior fellow at the Cato Institute. “Bailout Would Impose Needless Economic Damage”. Real Clear Politics. 1 Oct. 2008 – The bailout will increase corruption in Washington. When politicians have more power over the allocation of economic resources, people have an incentive to play the “rent-seeking” game of exchanging campaign contributions and hiring lobbyist in hopes of obtaining unearned wealth (or, more honorably, taking the same steps in hopes of protecting themselves from those seeking unearned wealth). The squalid mess at Fannie Mae and Freddie Mac was made possible in part because politicians received enormous amounts of money from advocates of the two government-sponsored enterprises. If the government obtains power over financial markets, including the ability to steer money to particular firms, it will create a feeding frenzy of lobbying and influence peddling.