The Right Question

Joe Weisenthal asks the right question about AIG: not "Will AIG give in to Obama?" or "Will AIG snob Obama?" but "Should AIG give in to Obama?"

Think about it for a moment. Obama is threatening to cut off AIG's air supply unless it reverses course on its bonuses. But AIG's bailout isn't meant for AIG, it's meant for AIG's counterparties. At some point along the way, it was deemed that the best way to bail out those banks was via AIG rather than directly.

Now we're learning how wrongheaded that was.

So there's really not that much upside for AIG. It's a heads-we-win, tails-we-nuke-the-entire-banking-system proposation. Is it really worth playing that game just to stoke outrage.

Which once again is strong evidence that the only workable long-term solution to problems like AIG is Plan N, period.

So let's do it already. I think the public is more than ready to have the government start calling the shots on these companies.