The right role with the right cash

September 19th, 2008 at 12:33pm Linda Grist Cunningham

I’m a “little d” Democrat and normally that means I’m socially liberal and fiscally conservative. So, when the federal government starts taking over private businesses — nationalizing, so to speak — I get a tad perturbed. I am no fan of too much government.

For a journalist — and for you – too much government can translate into local elected officials and government employees circumventing the Freedom of Information Act by withholding public records. It can translate into public-private organizations that take taxpayer funds but stay outside public oversight because they are “private.”

So, when the federal government nationalizes the financial industry (Thursday’s announcement of a major “systemic” takeover of failing financial institutions), loans staggering sums to a private insurer (AIG), and takes over the mortgage lending market (that’s Freddie and Fannie), I all but hyperventilate.Then, I take a deep breath and I am glad, very, very glad for this government takeover. Friday’s Wall Street Journal nailed the headline:  “Worst crisis since the ’30s; no end yet in sight.”

It’s a headline guaranteed to scare the checkbook right out of your pocket, not because of what it said, but because of who said it: the conservative, hard-to-fluster, pro-business Wall Street Journal. Yes, it really is that bad. (You might enjoy this column from Columbia Journalism Review.)

There is, however, one resounding difference between the crash of ‘29, and today. The federal government — indeed, governments around the world — is stepping in quickly to plug the holes through which the world’s major corporations will plunge.  Make no mistake. Some of the bad guys will escape with their cash firmly in hand. I wish that were not so, but I am more than happy to trade that bit of unfairness for assurance that freefall and meltdown may not be permanent fixtures in my headlines.

The weekend’s upcoming news will overtake my column I am sure. Still, sitting at my kitchen table Thursday night and seeing the warring Congressional parties come to the same podium committed to shoring up our country’s economic foundation was reassuring. This is, for now, government’s appropriate role: protect and defend. This time with cash not guns.

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