That's funny, because over here in the UK, it was a deregulated banking industry borrowing money it didn't have to lend to people who couldn't pay it back because of some crazy idea that the crippling interest rates and the option of repossessing all their homes would make the whole thing profitable and safe. Throw in a vast herd of people happy to borrow many times their salaries and piss away the money, and loony lefty interference isn't required as far as I can see.
It's all right though - the government are borrowing money they don't have to (allegedly) encourage those banks to lend some more to some really broke people struggling through a recession. How can you ask a near-bankrupt bank you've just propped up with borrowed money* to make some more inadvisable loans to consumers and small businesses that are even less wealthy than they were the last time that turned out to be a bad idea?
Obviously I'm not an economist. As far as I can see what we're doing is sucking wealth out of the future to create liquidity now. Trouble is, it seems to me the problem is that we've been doing that for a while and we're entering the period we sucked the value out of in the past few years, always somehow assuming that value would be created somehow. Well, nature abhors a vaccuum but it's not always pretty when it fills one.
* By the way, on an unrelated rant, I'm getting tired of people talking about the government bailing out banks with our money so that they can lend it back to us. It's worse than that - in what sense was the money in the bank ever anything other than ours? In fact we've had money extorted under penalty of loss of liberty in the name of the social good and pumped into the banking system because they pissed away all our money in an attempt to screw the vulnerable on a scale that was just a little too vast, to the point where it basically collapsed under its own weight. It's nothing new we're being screwed here ... it's just now the smaller, less powerful group of people who've been screwing us are getting screwed by the bankers too.