Agreeing with John Kerry; something is defnitely wrong

So I was up insanely early this morning (illness, sleep schedule hosed, not important), and I caught Meet the Press on TV. One of the panels had John Kerry and another Senator from Taxes (Republican), and they were talking about the pork spending bill. Now, normally I'm pretty much with the Republicans on their thoughts: the Republican Senator sounded like she "got it", and John Kerry came off as a liberal pushing his agenda (which, of course, he is).

However, I have to say (as shocking as this was to me), that I found myself actually agreeing with Kerry about how the government should handle the banks and their "toxic assets" problem. First, as an aside, let me say that the term "toxic assets" is misleading and disingenuous; the near-worthless mortgage securities which banks have on their books would better be termed "unrealized gambling losses", as that both better conveys their actual genesis, and doesn't make it sound like they were not entirely of the banks own doing, in pursuit of higher profits. Plus, I have a feeling voters might be somewhat more incredulous about the government buying "unrealized gambling losses" at fantasy value, as they well should be. But I digress...

Kerry's position was that if the government eats the losses from the gambling bets, it should wipe out shareholders of the banks, and the government should get warrants to any future gains if by some miracle those gambling bets get into the money. This is compared to the Republican position, which seems to be that the government should just eat the losses, without any compensation, and let the banks take more gambles in the future "for the good of the markets". Now, I'm a pretty "free market" person, but that's ridiculous: if were not going to let the banks fail outright as just compensation for taking ridiculous gambling risks chasing profits, the least the government can do is wipe out the shareholders and get warrants for future gains. Now, I'm sure Kerry would contend that the government should nationalize the banks (de-facto at least), and resume below-market risk-ignorant lending, which I wholeheartedly disagree with; the last thing we need is the government taking the same idiotic risks the banks did with public money, in the name of "crisis, must do socialism, direst of consequences" etc. But if we need to intervene to prevent the connected markets from all collapsing, take a financial interest which supersedes the normal shareholders, take the bad gambling debts off their books, give them an infusion of new capital (from public money), and for god's sake, make sure there's some g-damn regulation and oversight to prevent any more risky gambles, under-market lending, or lavish compensation.

Oh, and one more thing, while I'm thinking about the show. Later, they had a Democrat from Congress railing against the banks for paying out lavish bonuses after getting TARP money. She called them "idiots", and insinuated that they don't know what they are doing. Oh contrair, Ms Senator from wherever... they know exactly what they are doing. They can see the writing on the wall, when they get nationalized or equivalent, and either their private industry collapses, or worse (eg: the government collapses the currency trying to reflate the housing bubble). There are certainly idiots involved in the TARP debacle, but the wall street executives taking the money which you gave them and running are not among them. I would look first and foremost to the people who voted to give them public money with no oversight, no strategy, no transparency, and no perceptible strings attached: if there is idiocy to be found, I'd start there. I wonder how she voted on TARP 1 & 2...