I am a shareholder in AIG

Some reactionary remarks on this past weekend legislative efforts: I'm uncomfortable with the federal government's willingness to align itself with failing American companies. I understand the argument in favor of these policies goes something like this (disclaimer - I know nothing about this stuff, correct me if I'm wrong): because these failing banks are insured by the FDIC, if they go under, the taxpayers will have to shell out a gigantic sum of money. So, if the treasury secretary steps in and provides a giant sum of money to stabilize the companies, there will be less burden on the taxpayer in the long run.

Is this a good argument? It seems like it, at least on the surface. Does it justify the actions of the federal government? This is less clear. Time magazine explains my hesitancy:

This is the state of our great republic: We've nationalized the financial system, taking control from Wall Street bankers we no longer trust. We're about to quasi-nationalize the Detroit auto companies via massive loans because they're a source of American pride, and too many jobs — and votes — are at stake. Our Social Security system is going broke as we head for a future where too many retirees will be supported by too few workers. How long before we have national healthcare? Put it all together, and the America that emerges is a cartoonish version of the country most despised by red-meat red-state patriots: France. Only with worse food.

And where does the authority for this type of action come from? It's certainly not in the Constitution. But, on second thought, the authority comes from the American people. The government has been involved in similar projects since the New Deal. We shouldn't be surprised - this concentration of power is exactly what we wanted.

In the NYT today, Bill Kristol lays out the case against the Bush administration's legislation:

But is the administration’s proposal the right way to do this? It would enable the Treasury, without Congressionally approved guidelines as to pricing or procedure, to purchase hundreds of billions of dollars of financial assets, and hire private firms to manage and sell them, presumably at their discretion There are no provisions for — or even promises of — disclosure, accountability or transparency. Surely Congress can at least ask some hard questions about such an open-ended commitment.

And I’ve been shocked by the number of (mostly conservative) experts I’ve spoken with who aren’t at all confident that the Bush administration has even the basics right — or who think that the plan, though it looks simple on paper, will prove to be a nightmare in practice.

Yep.