Nice Bailout. Now Pay for It!

Congress and the president favor a $700 billion Wall Street bailout, but they're afraid to say how they'll pay for it.

By Daniel Gross
Posted Monday, Sept. 22, 2008, at 5:21 PM ET

To spend is to tax, as capitalist deity Milton Friedman is said to have put it. If so, over the last several months, we've seen an orgy of tax increases and potential increases. Time was, that prospect would have set off a revolution.

Consider the spree of actions that have the potential—directly and indirectly—to cost taxpayers money: the government accepting $30 billion of Bear Stearns' drecky collateral for a $29 billion loan to JPMorgan, giving investment banks access to the discount window, assuming responsibility for Fannie Mae and Freddie Mac, guaranteeing money market funds (up to $50 billion), making a big loan to AIG (up to $85 billion), and now proposing the mother of all bailouts—up to $700 billion.