The biggest piece of constructive advice I could give to Obama on the banking rescue is to democratize it. If buying these legacy assets is a pretty good bet long-term, and if it's going to help the economy recover, why shouldn't small investors, like yours truly, be able to participate? Dan Gross:
It wouldn't be hard to arrange for small-fry investors to participate in the bailout. The government could partner with investment-management firmsespecially well-regarded investment-management firms such as Vanguard and TIAA-CREFto create mutual-fundlike vehicles in which individuals could invest as little as a few hundred dollars in the effort to stabilize the banking system.
The feds could even offer such an investment as a check-off on tax returns. Or we could present it as an allocation choice for federal employees' retirement accounts. Legacy loans and legacy assets could be offered as an option for state-sponsored 529 college savings programs, in which investors typically commit to lengthy holding periods. Or they could be made part of the universal savings accounts that Obama supports.
And if the private-equity or hedge-fund industry had an ounce of PR savvya really big ifit would help individuals make similar investments while waiving the management and incentive fees.
It's one way to lance the populist boil as well. One reason many people are rightly angry is that they feel the system is rigged in defense of the big guns. The rescue plan is more of the same. A little tweaking, a little imagination ... you know, like the campaign.
We want to hear what you think about this article. Submit a letter to the editor or write to firstname.lastname@example.org.