Please Forward to Your Congressman/woman/transgender

Why this bailout strikes me as “odd.”

1) Congress is about to spend $850billion without holding even one day of hearings to determine what options are available and what people (other than elected officials and lobbyists) such as experts have to say.
2) Nobody seems interested in a solution which injects the same amount of capital but which rewards those who managed risk properly rather than rewarding parties who bet, lost, and now want their money back.
3) This “unprecedented” crisis has happened before and was “solved” without destroying the risk/reward paradigm which is essential to capitalism. Ex. The Swedish solution to their “unprecedented” financial crisis of the early 1990s involved preferred equity investment by the taxpayers. Or, as Luigi Zingales of the University of Chicago suggests http://faculty.chicagobooth.edu/luigi.zingales/research/papers/Why_Paulson_is_wrong.pdf, the solution could involve debt forgiveness or a debt-for-equity swap. Effectively, banks could simply be placed into receivership (as would happen with any other failing enterprise which cannot pay its creditors). Receivership would restructure the debt to pay something to the creditors, but they would bear the risk associated with the poor investments. I am sure there are other historical examples. The key question is why we are not hearing about any solutions which are consistent with the risk/reward tradeoff necessary for our investment system to function.

PS to Congress: Go Employ Autopederasty!