Thanks, but no thanks -- that's likely to be Democrats' answer to one of their biggest benefactors.
Billionaire speculator and left-wing political contributor George Soros has parachuted into the debate over the financial crisis by floating his own rescue plan. Democratic Rep. Jim Moran of Virginia held a meeting Wednesday with Robert Johnson, who once managed Mr. Soros's hedge fund, to discuss his proposal to recapitalize the American banking system by purchasing equity in banks and investment firms with taxpayer dollars. The Hill newspaper also reports that Mr. Soros has been in touch with the Obama campaign.
Mr. Soros certainly isn't hiding his idea. He published its outline in a Financial Times op-ed and is circulating a concept paper fleshing out the idea. But Democrats may wish to be wary. A longtime financier of the Democratic Party, Mr. Soros is a lightning rod for criticism from conservative radio talk-show hosts. There are also serious policy objections to the Soros plan that could lead Democrats into being accused of promoting socialism. Robert Shapiro, a former Commerce Department undersecretary during the Clinton administration, said government ownership of stock in troubled firms would mix profit-making with policy goals in an unhealthy way.
"How does the government vote the shares?" he asks. "It puts them in a potential conflict of interest. Regulatory interests may hurt the bottom line."
John Fund is an editorial writer for the Wall Street Journal
