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A historical look at "Too big to fail"

Posted on November 22, 2011 by Kyla Springer
Topics: Corporations, Economic Development, Globalization, Governance, Trade
A golden parachute for all. Photo: <a href="http://www.flickr.com/photos/jkannenberg/3451782319/sizes/z/in/photostream/">John Kannenberg (flickr)</a>
A golden parachute for all. Photo: John Kannenberg (flickr)

"Too big to fail." We’ve all heard it. It’s why the U.S. government bailed out some the world’s largest banks in 2008. And the largest U.S. automakers in 2009. But where did we get this idea that our governments can and should bail out private companies in a free market? Here's how the seeds were planted more than 70 years ago that made bailouts not just legal, but seemingly essential.

We’ve split up our thoughts into four acts:

Act 1: The battle over the lessons of the Great Depression.
Act 2: The first bailout leads to the next, and the next.
Act 3: The value and perils of deregulation.
Act 4: Banking crises go global.

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Keywords: bail out, emerging markets, free market, global financial crisis, Great Depression, OWS

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