Tuesday, March 24, 2009

Too Big to Fail

AIG is too big to fail! Fanny Mae is too big to fail! Freddy Mac is too big to fail! General Motors is to big to fail!

Perhaps so - but if a company is too big to fail then it is to big to exist. In the late 1800's we created tools to break up companies into smaller entities.

Using the anti-trust laws Standard Oil was broken up long ago. In my lifetime AT&T (Bell Telephone) was broken up into the "baby Bells". More recently there was a failed attempt to break up Microsoft. It would be much better for our prosperity and our posterity if we use the anti-trust laws to break up companies that are too big to fail and to prevent their creation.

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