Too Big to Fail

Do you remember the slogan “too big to fail,” which was invoked when General Motors faced a financial crunch and was bailed out by the government in 2008? Other bailouts associated with the 2008 global financial crisis were:

AIG, American International Group, received $180 billion from the Government.

The Auto industry, General Motors, and Chrysler.

Large commercial and investment banks.

Fannie Mae and Freddie Mac were effectively nationalized.

Bear Stearns, the investment bank, was sold to J P Morgan Chase in a government-brokered deal to prevent its failure.

The question is, should businesses be allowed to grow so big that their failure could cause economic harm to America? It doesn’t seem fair for those companies that may be large but not too large are allowed to fail.

What about our Government? Is it too big to fail? With Government funding reaching critical mass every year or so, shouldn’t it be downsized so that its failure to receive financial support to stay open not be in a position to harm workers, especially in sensitive, essential areas?

Shouldn’t there be better protections against being too big to fail?