Invariably, whenever two people start debating “to bail our not to bail out” a TARP recipient, like CIT, one of them always says: Well, we have all this taxpayer money invested in them, do you want to just lose that?
Someone on TV just said it, though it’s said all the time and we don’t mean to pick on him, whoever he was.
But really, this is the WORST argument concievable, even if that company has received tens of billions, like Citigroup or Bank of America. In fact, we heard this line all the time a few weeks ago, when there was talk about Citigroup needing to pay big salaries in order to compete: “We have all this taxpayer money invested, don’t we want them to do well?”
Anyone who’s ever played poker knows that you can’t just say: Well, we’ve put chips in the pot, so we can’t fold.
Well, idiotic poker players think like that. Serious players know that on any street (we’re talking No Limit Hold ‘Em) — regardless of how many chips you’ve put into the pot — you have to weigh the pros and cons. Sunk costs are sunk costs!
We’re happy to sacrifice the few billion we’ve put into CIT — a pittance, really — to end the ongoing cycle of bailouts. PLEASE.
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