Bailout might accidently get good

U.S. May Take Ownership Stake in Banks

Having tried without success to unlock frozen credit markets, the Treasury Department is considering taking ownership stakes in many United States banks to try to restore confidence in the financial system, according to government officials.

Treasury officials say the just-passed $700 billion bailout bill gives them the authority to inject cash directly into banks that request it. Such a move would quickly strengthen banks’ balance sheets and, officials hope, persuade them to resume lending. In return, the law gives the Treasury the right to take ownership positions in banks, including healthy ones.

Well well well, look what just might have happened. The government might accidentally use taxpayer money in a smart way to bail out companies. I know, I don't know what happened either. Maybe it was Iceland taking that track. Maybe it was Gordon Brown announcing a plan to do the same in the UK yesterday. Whatever the case, Henry Paulson just might not piss away $700 billion dollars on buying worthless assets and the United States Congress might have actually crafted a competent, even good bill. I'm as baffled as you are. When did we start to be governed by adults?

Now, don't plan the party just yet. Buying equity stakes in the banks and financial institutions is only an option and Paulson has only indicated he was moving in that direction, not definitely doing it. So we could just be living out the same scenario we have for 8 years: government flirts with the right plan, switches to ineffective bullshit on a whim, chaos ensues. Though the fact that recapitalization might happen, which means we get an equity stake, which means we might actually get the money back and fix the problem, is heartening when the optional nature of it's inclusion in the bill left some thinking that it meant that it would be totally ignored.. Mark it on your calendar: Bush Administration given option to do right thing and appears to consider doing right thing with no ulterior motive. Who knew it could happen? All they had to do was drive us to the brink of economic collapse.