One aspect of the nationalization debate that gets insufficient attention is that the federal government already nationalized a bank: They took over IndyMac Bank in July. Estimates were that cleaning its balance sheet and selling it back to the private market would cost between $4 billion and $8 billion. So how'd that turn out? Last Thursday, the FDIC completed the sale of IndyMac. Taxpayers sustained a $10.7 billion loss, not including the $2 billion in shareholder wealth that was wiped out. Ryan Grim has the whole story. It's true, of course, that the sophisticated advocates of nationalization hold that nationalization would be less expensive for taxpayers, not inexpensive for taxpayers. But it's worth preparing for a world in which even that will feel awful and look bad. This is one of those situations where even if the liberals see their favored policy adopted, there will be few winners and no sense of triumph.
