Jenkins: Too Bernanke To Fail? - WSJ.com:
"The effort of congressmen to uphold the distinction between the public and private sectors is noble, and doomed to fail in this case. Last week's hearing reflected unmedicated unease over two facts legislators recognize but resist acknowledging: There is no practical solution to 'too big to fail,' and no alternative to the Fed's ability to print money to ease potentially destabilizing financial panics.
Governments long ago authorized banks to operate with capital and reserve requirements inadequate to cover serious panics, with the understanding that government would step in. 'We have chosen capital standards that by any stretch of the imagination cannot protect against all potential adverse loss outcomes,' Alan Greenspan explained in a talk at the American Enterprise Institute this month. 'Implicit in this exercise' is the occasional bailout of the financial system."