What are the longer term risks by having the US Government own equity stakes in banks?
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408 points
SallyG answered one month ago …
Basically, it's not a good idea to have political power and financial power in the same hands. It's sort of like the separation of church and state, or the separation of the three branches of government (legislative, executive, and judicial), the last of which seems increasingly under attack from presidents and vice presidents who don't seem to respect the other two branches as coequals providing checks and balances on an increasingly "imperial" presidency. Just because the vice president presides over the Senate does not make him (or her) a member of the legislative branch--check the Constitution! (Sorry for the political rant.)
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726 points
alanj answered one month ago …
I can't think of any. As far as the government having a stake in our banks-it has purchased prefered shares which means it has no voting rights. The government is not going to be running the banks. So, the banks are not going to be in the governments hands as claimed by SallyG. And after the banks have stablilized and the economy improves they will sell the shares which will most likely result in a profit for the US taxpayer.
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