If its too big to fail, then the government should be in charge. Above a certain limit, there is a real danger that one large company could cause the cascade failure of the economy. That's been the problem the last few years. The very real danger that business consolidation and monopolies cause a great danger to the economy by the very possibility of failure. What we have seen in that past few years is the object lesson of this.
Theoretically, if the government controlled a large entity that is "too big to fail," then the accountability factor would increase. The operators of said entity would have to report to congress and/or other government entities and committees and be subject to scrutiny by the public.. The real sad comment on this whole debacle is that the regulators were in many cases sleeping at the switch or defunded to the point of impotence by a government hell bent on driving the economic engine for all its worth. The Republicans and to a lesser extent the Democrats that played along with them, bear a large blame for what happened. By dismantling all the careful controls on the markets put in place by the Roosevelt Administration in the wake of the Great Depression, the supply-siders brought forth a great period of economic growth. They also made a monster that grew to a point where its failure was inevitable. Bubbles eventually burst, fragile things that they are.
However, the very problem with government at this point is that the partisans are interested in preserving their ideology even at the expense of the people. Witness the governors of the various states who are refusing to accept stimulus money that may, in the end, benefit their own people on ideological grounds. I sense that many of these ideologues will be looking for a job come next election cycle.
The accountability factor is very important. Most board minutes are generally not seen by the public. Corporations conduct their business with a bureaucracy that is interested in the short run. Business lost sight of long term planning and expansion when they could afford it long ago.
A prime example of this is the company which contracts the company I work for. I work for Valor Security, which is a contractor for General Growth Properties, which owns the mall I work at. In 2002, General Growth went on an expansion spree and ended up buying a competitor for $12 Billion (Yes, that's with a "B"). It also bought several other malls and properties throughout the US. Result - the company is $27.1 Billion in debt and is teetering on the brink of bankruptcy. The CEO is out, the CFO is out, and hundreds of people who depend on these operations for jobs are at risk. Where were the regulators? Where were the people to tell these idiots they were biting off more then they could chew? It incenses me that the so-called "conservatives" in this country are willing to risk my money and yours in financing these get rich quick schemes and then we end up holding the bag.
The Government probably might not do a better job, but at least we can elect them and hold them accountable. And, in the end, if its "too big to fail" at least there will be some sort of continuity until the problem gets fixed. The government operated system theoretically cannot fail and doesn't lead to an economic collapse.
This whole debacle also speaks to the fact that there should be a maximum size of a business. Maximum limits should be set on percentages of the market and ownership so that if a business goes under, it doesn't take the rest of the economy with it.
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