It's funny because it's true

A Defense of the Geithner Plan

Since Secretary Geithner announced his $1 trillion plan for combating the economic crisis, there has been a surplus of critics and a shortage of defenders. The whole thing looks like a boondoggle to most of us. But I was able to find one intelligent defense of the package that is worth a read for Conservatives and Liberals alike.

Q: Where does the trillion dollars come from?

A: $150 billion comes from the TARP in the form of equity, $820 billion from the FDIC in the form of debt, and $30 billion from the hedge fund and pension fund managers who will be hired to make the investments and run the program's operations.

Q: Why is the government making hedge and pension fund managers kick in $30 billion?

A: So that they have skin in the game, and so do not take excessive risks with the taxpayers' money because their own money is on the line as well.

Q: Why then should hedge and pension fund managers agree to run this?

A: Because they stand to make a fortune when markets recover or when the acquired toxic assets are held to maturity: they make the full equity returns on their $30 billion invested--which is leveraged up to $1 trillion with government money.