Paul Krugman and Josh Marshall both make a political economy point I'm trying to tease out in my piece for this week. As Krugman puts it:

As long as capital injections are seen as a way to bail out the people who got us into this mess (which they are as long as the banks haven’t been put into receivership), the political system won’t, repeat, won’t be willing to come up with enough money to make the system healthy again.

Agreed. The beauty of nationalization (in some form or another) is that it potentially defuses the anger that's preventing Congress from spending enough to recapitalize the banks.

--Noam Scheiber