As Wall Street banks collapse like a house of cards, American capitalism isn’t just failing in practice; the very idea of unregulated, free-functioning markets has received a serious blow, writes Anthony Faiola in the Washington Post. Once the symbols of American economic might, there's a real possibility that many US banks may find themselves partially government-owned as part of the bailout, altering America’s influence in pushing laissez-faire policies in controlled economies worldwide.
Through the takeovers of Fannie and Freddie and the rescue of AIG, the government is now a mortgage lender and insurance provider to millions, prompting economists to question whether ours remains a free market. Meanwhile, developing nations exercising heavier government economic control are poised to weather the crisis better than the deregulated West, and that likely won’t change anytime soon.
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