amounts to saying “just because nationalization worked in Sweden doesn’t mean it’ll necessarily work here, so I’ll try something else that also might not work.”
He has a very helpful round-up of responses on all sides:
See also Paul Kedrosky (who I largely agree with but I wouldn’t quite get so irate), Felix Salmon (who’s grateful that unlike Geithner, Bush, or Paulson Obama can at least explain himself in a cogent way), Paul Krugman (who says nationalization is more American than Obama thinks, but who has no credibility since he’s on the Swedish payroll) and Tyler Cowen (who I think agrees with Obama).
Salmon, as often, makes a lot of sense:
I think the point about culture and traditions is actually substantive; it's not party-political. The number of banks in a country has almost nothing to do with its GDP; I don't know what Kedrosky's point is there. And Obama never said that we would need to nationalize thousands of banks. But if you nationalize some banks, then you introduce a generalized, and possibly self-fulfilling, fear that you might nationalize any bank. Pointing at smaller banks and saying "we won't nationalize you" is a recipe for creating multiple bank failures, if there's no other option for bailing them out.