Bailout Baloney

Well, which is it? On one hand, Secretary Paulson claims that the mortgage-backed securities on bank balance sheets are so “toxic” that letting them stay there puts the entire economy at risk. On the other hand, Mr. Paulson himself, and President Bush last night, claim that the value of the assets will eventually rise higher than the current market price, so that taxpayers will eventually recover much of the $700 billion Messrs. Bush and Paulson propose to spend buying up these assets. This is a point that even President Clinton agrees on: Mr. Clinton was on television last night reckoning that “There’s a fair chance if this is done right, the taxpayers will get their money back, even make a profit.”