The Bail-Out as Class Warfare
The argument for bailing out AIG essentially amounted to this:
I don’t have much sympathy for this argument. See, about a decade ago, my sister had a small business exporting cosmetics from the US to South America. She was doing OK, in a small business edge-of-the-abyss kind of way. And then came the Brazilian devaluation. Overnight, a number of her customers were driven out of business, several of them owing her what to her was a substantial amount of money, though to the folks on Wall Street, of course, it was a mere pittance. The result was she liquidated her stock, wrapped up what was left of the business, got a job in the corporate world, and like most people there, is today worried about keeping that job.
Now, none of the Welfare Queens on Wall Street who has been helped by this whole charade of a bail-out would ever suggest bailing out small businesspeople like my sister, even if the source of the problems faced by these small businesspeople was, for lack of a better term, their counterparties. So for this to be viewed as something other than favoritism, class-warfare of the crudest, most basic form, someone is going to have to show why providing small businesspeople the same help that the Welfare Queens on Wall Street got, or simply handing out equivalent sums of money to the rest of us, would have resulted in an outcome worse than what we’ve seen, are seeing, and will see. I don’t think it can be done.