I had my fourth or fifth conversation with a “man of the street” regarding the bailout today. They’ve all gone roughly like this

 

THEM: What do you do?

ME: I’m an economist.

THEM: URGH, OBAMA! Why did we give the banks billions instead of giving it to people.

ME: Well we didn’t give the banks money, we loaned them money. And to make sure they paid it back we took a temporary ownership stake in the banks. You can’t actually take an ownership stake in people. It violates the 13th amendment <smile, pause for laugh>

THEM: But why did they use the money for bonuses!

ME: Well their argument is that if they don’t pay their workers the workers will leave for foreign banks. In fact, many of the banks paid back the government early so that they could be free to increase pay. It doesn’t really help the owners of the bank to pay the bank workers more money, so I would really guess that they have to.

THEM: Huh, you told me something I didn’t know.

 

The last phrase was almost literally word for word from all five people. So, I don’t know where the White Houses communication break down is, but every person I have talked to has gone from pissed to understanding in less than 5 minutes. Now maybe they won’t stay unpissed, but its a few data points worth passing on.