I read this great article the other day on the government bailouts. It shows the history of government bailouts for banks and investment firms. It should have occured to someone that if the bailouts didn't work before, then they won't work now.
In economics, this is a problem called "moral hazard". By bailing out firms and insulating them from risk, you change their behavior. It was summarized in the article by this great quote, "The ultimate result of shielding men from the effects of folly is to fill the world with fools."
You can't let firms make enormous profits during good times, and then use taxpayer money to bail them out during bad times. That's not supposed to be how the game works.
