Robert E. Wright and his colleagues provide an unbiased history of government bailouts and a frank assessment of their effectiveness. Their book recounts colonial America's struggle to rectify the first dangerous real estate bubble and the British government's counterproductive response. It explains how Alexander Hamilton allowed central banks and other lenders to bail out distressed but sound businesses without rewarding or encouraging the risky ones. And it shows how, in the second half of the twentieth century, governments began to bail out distressed companies, industries, and even entire economies in ways that subsidized risk takers while failing to reinvigorate the economy. By peering into the historical uses of public money to save private profit, this volume suggests better ways to control risk in the future.
Additional Columbia / SSRC books on the privatization of risk and its implications for Americans:
Health at Risk: America's Ailing Health Systemand How to Heal ItEdited by Jacob S. Hacker
Laid Off, Laid Low: Political and Economic Consequences of Employment InsecurityEdited by Katherine S. Newman
Pensions, Social Security, and the Privatization of RiskEdited by Mitchell A. Orenstein
About the Author
Table of Contents1. The Evolution of the Reconstruction Finance Corporation as a Lender of Last Resort in the Great Depression, by Joseph R. Mason, Louisiana State University and the Wharton School
2. Financial Crises and Government Responses: Lessons Learned, by Benton E. Gup, University of Alabama
3. Hybrid Failures and Bailouts: Social Costs, Private Profits, by Robert E. Wright, NYU Stern School of Business
4. After the Storm: The Long Run Impact of Bank Bailouts, by Guillermo Rosas and Nathan M. Jensen, Washington University in Saint Louis
What People are Saying About This
Do bailouts make good financial sense and benefit the public at large? What are the ethical issues surrounding government bailouts? How far back does this history go in America and what have been the consequences of these interventions? This book tackles these questions as well as, most importantly, whether government bailouts speed up financial recovery. Compact, easy-to-read, yet firmly grounded in academic scholarship, Bailouts is an excellent introduction for nonspecialists interested in the costs and benefits of bailouts.
Nouriel Roubini, New York University Stern School of Business, and coauthor of Bailouts or Bail-ins: Responding to Financial Crises in Emerging Economies