Let's Downsize Our Outrage

It’s time to put down the pitchforks, writes Steven Pearlstein in the Washington Post. Public outrage is getting so hot that it’s actually undermining government efforts to contain the financial crisis. Right now, the Treasury is desperately trying to lure private capital back into the so-called shadow banking system. But how eager will private equity be to invest if it thinks it will face “front page accusations, congressional inquiries and public outrage?”

Financiers don’t want to get involved with a government that “changes the rules of the game with every zig and zag of public opinion.” And we need their money; every dollar they invest is one Uncle Sam doesn’t have to borrow. Nothing about this is fair, of course. “During a financial crisis, fairness is a luxury we cannot afford.” (More AIG stories.)