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Thursday, November 13, 2008

Corruption on the way, I predict

There's a big, $700 billion pile of money in the current bailout bill ($350b to start) plus a lot of interesting things going on in terms of which banks get equity stakes, how big those stakes are, whether you are allowed to become a bank, whether you fail (Lehman Brothers), get bought by the government (AIG), are forced to sell yourself (Bear Stearns, Wachovia), or get government money to increase capital (Chase, Citicorp, etc.)

These are all decisions that (a) we have few rules or precedent for, and (b) affect the financial well being of a lot of rich people, and (c) are being made rapidly and (d) aren't subject to a standardized review process.

This situation is MADE for corruption. This is not a statement of Democratic weakness or Republican weakness, only human weakness. It is only a matter of time.

It sounds silly, but we might as well take Patrick Fitzgerald and make him special prosecutor now, and avoid the rush later. (Fitzgerald is US attorney in Chicago, and special prosecutor in the Valerie Plame investigation). The notion that Fitzgerald is poking around might also have a prophylactic effect.