The Business Ethics Blog

On Friday I blogged about my lack of understanding of the Big Bailout and what led to it being necessary. Over the weekend I found a bunch of good resources.

First, some multimedia stuff:

This half-hour PBS documentary is good on the politics involved in negotiating the bailout: Behind the Bailout (See the video link at the right-hand side of the page.) (Thanks, Kim!)

Via economist Greg Mankiw’s blog, here’s a stick-figure slide-show that explains the source of the trouble: Subprime Primer (follow the link, and then click to advance through the 45 or so slides). Funny, but not appropriate for small children.

Next, on to wordier stuff:

Here’s Ed Harrison’s Dummy’s Guide to the US Banking Crisis (a bullet-point history, starting in 2001)

Two renowned economically-savvy legal scholars, Richard Posner
and Gary Becker have weighed in, over at their joint blog. (Posner is particularly clear & useful. Interesting how some of the biggest minds are able to dumb things down the best.)

Finally, here’s an even more cynical view. Filmmaker Michael Moore is claiming that it’s all a scam, an effort by Bush & his pals to squeeze a few more dollars out of Americans before leaving office: The Rich Are Staging a Coup This Morning …a message from Michael Moore. My quick take: the weight of expert opinion is against Moore. I take it as significant that just about every economist & finance expert I’ve read says this bailout is necessary, even if they think it’s a necessary evil. Economists are pretty famous for disagreeing amongst themselves. But there seems little credible disagreement here. Lots of them think this is a really terrible thing (either ideologically because they’re against government involvement in the economy or pragmatically because they think it sets a bad precedent). But they pretty much all seem to agree that yes, indeed, the government really does need to do something big here. The stuff to haggle over is about the size of the bailout, the terms, and questions of oversight. And, of course, what to do to prevent a ‘next time.’