Theories of TARP evolution

Via J. Wallace, here is a tableaux of how U.S. banking/bailout proposals have evolved.  And of course the Geithner plan has hardly proven itself overwhelming.  I offer up the following hypotheses, none of which settles the issue for me:

1. U.S. banks have been known to be insolvent for some time and everyone is simply afraid to come out and admit it.

2. The economists offer up coherent plans, but they are then bogged down by the input of competing advisers and Karl Rove-like politicos.

3. The goal of the various plans has been to confuse Congress.

4. The Republicans were just stupid and irresponsible and now the Democrats are smart but they lack experience at the rudder and they need another try to get it right.

5. The Republicans were just stupid and irresponsible and now the Democrats are just stupid and irresponsible.

6. The Obama team is brilliant and we are the silly ones who insist on imposing simple narratives on all policy actions.  Good policy should be difficult to understand.

7. The Democrats made the mistake of setting an artificial deadline and by the time it came around they realized they had nothing so they put up what they had, which wasn't much.

8. We need to re-benchmark our expectations because the world doesn't work as well as we used to think.  What we used to consider "bad policy" is, in reality, compared to the relevant alternatives, "reasonably good policy."

9. U.S. banks are insolvent but we can muddle through if we ignore that fact and let them evolve back into solvency.  What we need is a plan which lacks transparency and Geithner delivered.

10. All of the above.

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