« Student Blogger - "Glocalization" - a Third Way for Regulating Global Services? | Main | Obama's America: Liberty and Secrecy »

January 20, 2009


Feed You can follow this conversation by subscribing to the comment feed for this post.


In one sense, this worsening recession is one great market "taking" from debtors and creditors alike. No real would-be equal protection problems there. The real problem crops up when we intervene. Should bank balance sheets be made whole to protect wealthy bank shareholders at taxpayers expense? Should mortgagors be saved to create more bad debt on the balance sheets of those already in trouble? Whose little piggy is to get the goring here, at our hand? The economic interrelationships here are dazzlingly complex. If we tinker, how far should protections reach? Is the test, “out of sight, out of mind?” I argue that the market is doing a fine job of murdering everyone alike in its pointed effort to have us understand we were over-spent, over-extended and over-priced, and all without taking problems, too. Whether I believe that notion should guide us is quite another thing.


It's an interesting question, but it seems almost impossible to answer. Something that seems procedural, like the debtor's ability to classify similar claims separately, might have a large impact on creditors' ability to vindicate their property rights (right?). But does this compel us to apply such procedural changes on a going-forward basis?

Maybe the answer is that not everything that affects a property right is a property right, and you can lose the effective ability to vindicate your property rights without having your property taken. But that doesn't seem satisfactory.

The comments to this entry are closed.