Does the USA need a perestroika?

[NJ5]

famousringo said:

mrstickball said:
But here's a question:

What exactly would we have lost if the banks went under?

It's not like every single bank participated in the atrocious behavior, and sold so much toxic assets. Many were left unscathed. Furthermore, the toxic mortgages would not have been forfeited and the houses would have been given to the bad purchasers for free. The debts would of been outstanding, still. Other banks would have come in and bought the toxic assets at discounts (as they always have done) and banks would have actually learned a lesson.

Worst case scenario? Complete loss of faith in the financial system leading to massive cash withdrawls and a collapse of the money supply, the lack of liquidity and general uncertainty grinding economic activity to a halt.

Even though I think the scale of failure was too huge to stand idly by, I agree that the banks still need to be taught a lesson. Pull a Standard Oil and dice them up into more managable chunks while keeping a closer eye on huge system-wide problems that will develop from time to time. Too big to fail is too big to exist as a whole.

You know, with the massive amount spent on stabilizing the big banks, the government could probably have done a massive education program on the banking system, and helped people move their cash to credit unions and other stable banks. They're always eager to take the big banks' business.