Dear All-You-Smarter-People: …
We read Paul Krugman earlier today to get our obligatory blast of humility.
As Washington and Wall Street seem to be transfixed in a double-helix of negating animosity, we can only think of things this way.
What if nationalization–or as Calculated Risk started calling it, pre-privatization–is the right thing to do, like “the windows” is the right thing for a housekeeper to do, but the U.S. government just doesn’t do nationalization/pre-privatization?
What do you do if the housekeeper says, “I don’t do windows?” Do you make her/him do them anyway? If you do that, then maybe you wind up with scratched or broken windows.
Maybe not going the nationalization route is not so much a disagreement with the theory, but an admission that “we’d be really bad at this.” What about the Wall Street Journal opinion piece today by Holman Jenkins: Rethinking the Fan and Fred Takeover.
As a matter of fact, the U.S. government may have a point. It may not do nationalization well, and therefore, it should explore as many alternatives as possible. What’s more, the private sector hasn’t demonstrated a high degree of competence at doing privatization, so maybe while we’re exploring alternatives to nationalization for the banking system; we shoud explore options to privatization for any number of other dimensions of the financial complex.
How about we consider outsourcing both nationalization and privatization? It seems to us there are other countries, i.e. Sweden, that might jump at the opportunity to take on our bank nationalization program, and other nations, China, perhaps, that would do the same for free-enterprise takeovers.
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