I'm sold, as I think most people are, on the proposition that the collateral damage of the failure of major financial institutions is simply too great to allow. There seems to be a pretty clear consensus at this point that letting Lehmann fail in the way it did, for instance, was a category error. What's not as clear to me is the public interest in maintaining the equity of the companies' current shareholders.

Late Update: He's not necessarily addressing the same point. But Krugman thinks the Citi deal blows.