The sorry consequences of lettingLehmanBrothers fail, which was intended to discourage moral hazard, showed that the middle of a crisis is not the time to get tough.
The most seismic event of the crisis to date, the bankruptcy of LehmanBrothers last September, demonstrated the costs of letting a big financial institution collapse.
But it has now been three years since the fall of LehmanBrothers, and the grip of government-backed finance is still tightening as opposed to letting up.