I'm in shock after seeing Secretary Paulson bemoaning the fact that he had to take a stake in many banks. He's not nearly so sad to be handing out cash with both hands, but he's offended by government taking a stake in private enterprise.
This is weird to me. I'd think a free market guy would be moaning about having to get involved in the market, but if he's going to do it, then to avoid any moral hazard, by God that company is going to lose equity. This reminds me of something I saw on PBS about the National Institute of Health. Why is it that taxpayer dollars pay for a sizeable fraction of the research in this country, but the government does not get a sizeable fraction of the royalties from the drugs developed from that research? To me, this is the same principle. I have no problem with government sponsored research, particularly in areas where commercialization does not appear imminent, but why government should do the investment and not share in the reward is beyond idiocy.
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