From TPM Reader JP …
Please stop using the highly inaccurate term “nationalization” which connotes permanent government takeover of the banks. The correct term is receivership, which is by definition temporary and a routine staple of our capitalist economy and banking regulatory system. Using the term nationalization plays into the propaganda of the far right.
As I’ve said a number of times, the term ‘nationalization’ at best confuses the issue, for pretty much the reasons JP says. I’m inclined to say that I don’t want to further confuse the issue by using a different term when this is the one everyone is using already. But perhaps JP has a better point than I realize.
The key is that financial reorganization of failed companies — whether it’s receivership, or bankruptcy proceedings, or something else like it — is textbook rule of law capitalism. If you’re a real free marketeer the real departure is keeping failed companies afloat with a perpetual taxpayer IV line, socializing all the losses and leaving all the upside with people who ran their companies into the ground. It’s not just a raw deal for taxpayers. It also keeps the whole economy in idle.
Josh Marshall is editor and publisher of TalkingPointsMemo.com.