To Be Fair...

I agree with Senator Obama 99% on this:

Obama addressed the latest news from Wall Street -- the federal bailout of the insurer American International Group -- insisting that the solution should not reward those who reaped benefits from the company’s investments when times were good.

“We don’t know all the details of the arrangement with AIG,” he said. “The Federal Reserve must ensure that plans protect the families that count on insurance and it should bolster our economy’s ability to create good paying jobs and help working Americans pay their bills and save money. It must not bail out the shareholders, or management of AIG that were making big profits when times were good. They shouldn’t be bailed out when times are bad.”

The Federal Government should not be in the business of backing off when profits are high and saving the day when they are low. My 1% disagreement would be that to the extent that the shareholders in question are other banks whose reliance on AIG or other failing institutions in their portfolios to remain solvent, we must - to a degree - not just tell them to go Bork themselves. One issue where I see the repeated Main Streel / Wall Street dichotomy as a very dangerous storyline is that it disregards the interconnectedness of the US economy. As the failures of these huge institutions show, when Wall Street collapses it has significant, and harsher, effects on Main Street. To the extent that Obama desires to motivate Main Street at the expense of Wall Street, I think he'll find that the long term consequences are similar to trying to scratch your back with a chainsaw.