More than $320 billion in taxpayer funding has already been pledged to treat firms sickened by the subprime contagion—more than twice the $124 billion the government spent fixing the savings and loan crisis in the 1980s, reports the Los Angeles Times. The question, writes Michael Hiltzik, is how much farther will this "bailout binge" go?
The "too big to fail" criteria that was applied to Freddie, Fannie and AIG could be used to justify financial help to General Motors; a proposed $50-billion assist to the auto industry, struggling to retool to meet higher mileage standards, could in turn open the door for the beleaguered airline industry. Critics say the handouts only exacerbate corporate recklessness and lead to more supplicants. "Every time you do it, that creates an equitable argument for someone else to get bailed out," says one.