by Frank Thomas and John Lawrence
Frank has eloquently argued “Yes” here in Part 2 and continued here in Part 3 of our examination of the financial crisis of 2008. Part 1 dealt with Republican economic philosophy over the last 30 years which had produced disastrous results for the economy leading up to the crisis.
This week John argues that AIG should have been allowed to fail and that this would not have affected Main Street banks or the banking activities of average Americans. But the real question is ‘If American taxpayers and the Fed had not given billions of dollars to AIG and the other large banking institutions, would they have indeed failed or would they, on the other hand, have survived quite nicely even without the bailouts?’
What’s clear in the financial crisis of 2008 is that Washington rescued Wall Street while abandoning Main Street.