The Prodigal Son (bailout)

Once, a father had two sons, who he both loved dearly. When the younger one grew up, he asked his father for his share of the inheritance. So, the father divided up his property and gave his younger son half. The father was proud of his younger son since he was financially astute, and he was happy at seeing him be independent.

The younger son travelled to a distant land and invested his money. He became a successful and esteemed member of his community, and he raised his children without making them do the kind of farm work that he had to do while growing up. However, as time passed, he made some bad investments and found himself heavily in debt. His colleagues and neighbors were unhelpful and angry at him, since he had lost their money. So, without any further options available to him, he went home to ask for any help that his father could give him.

When his father saw him coming, he ran out to meet his son, and offered him a roof for his family for as long as they needed.

"But father," the son said, "my family and myself are accustomed to a certain standard of living. I was wondering if you could help me pay off my debts instead"

"My son," replied the father, "I gave you the money that you asked for and deserved earlier. If I pay off your debts now, then that would take away from your brother's inheritance, and that wouldn't be fair to him"

"Father," said the son, "I used your farm as collateral on some of my loans. If I default on them, then both your family's livelihoods and mine will be precarious."

"How could you do that? If you were responsible for the well-being of many other people, why did you make so many bad investments? Don't you feel responsible for them?"

"With all due respect, father," said the son, "you yourself said that I was better at finances than you or my brother when I was younger. I also made many good financial decisions in my life, and these just happened to be bad. It wasn't my fault, you know. Nobody could have seen the disaster that befell me coming. However, if you don't mind, my children have lessons tomorrow, and I am meeting some associates for a new business venture. Could I have the money now?"

"Can't you at least cut back on how much you spend? I'm not paying for you to live better than I am"

"We have been cutting back. My daughter didn't get a horse last year, and we've laid off some of our household help. In either case, I'm not a child anymore, you really shouldn't be telling me how I should live my life, it's not proper."

Many people smarter than myself have written about the causes of the bailout, and enough debate is going on at this site about who is to blame. What does make me angry are our financial professionals not admitting that they made mistakes, not wanting to make changes or sacrifices, and acting as if they were smarter and better financially than everyone else, even as they drove the firms that were built on generations of safe investing towards banruptcy and insolvency. If nothing else, I'd like my tax dollars to buy the bankers some humility.