[Obama's] view was clear. The market is dynamic and important, but it makes people reckless, parochial and dangerously shortsighted. The market needs adult supervision — a leadership class made up of people who appreciate the market but who also have committed themselves to public service, and who therefore take the long view and are more conscious of the public good.
Brooks sees political as well as economic and practical advantages to such a rationale. He even seems to agree with it but is deeply worried about the government's potential fiscal irresponsibility. He goes on to conclude that:
This is not a matter of economics only, but credibility. Obama understands that this is primarily an authority crisis. A system Americans have trusted — the market — has failed in important ways. He has found a theme and bids to reassert authority. But he will seem like an impostor and a manipulator if he imposes responsibility on everybody but himself.
While reading the President's speech itself, I came across this enlightening answer to (and rebuke of) Paul Krugman and the nationalization clique:
So let me be clear: The reason we have not taken this step [nationalization] has nothing to do with any ideological or political judgment we've made about government involvement in banks. It's certainly not because of any concern we have for the management and shareholders whose actions helped to cause this mess.
Rather, it's because we believe that preemptive government takeovers are likely to end up costing taxpayers even more in the end, and because it's more likely to undermine than create confidence.
Governments should practice the same principle as doctors: First, do no harm. So rest assured, we will do whatever is necessary to get credit flowing again, but we will do so in ways that minimize risks to taxpayers and to the broader economy.
Which is my thinking exactly.
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