So the fed is going to bailout Bear Sterns.  After all, we can’t let yet another decidedly for-profit biz suffer the consequences of its subprime portfolio.  What’s good for GM is good for America.

A recurring theme has been the government’s role in saving corporate America from its own poor choices.  While Bush  threatens to veto the Surveillance Bill because it doesn’t absolve the telecoms (which is clearly more important than national security), and over-extended quasi-homeowners get to renegotiate their mortgages because they happily cashed out of their homes to prove that consumerism is cool, there are a few of us who will have to hear  Joe Hill’s words ring in our ears:  There’ll be pie in the sky when you die.

Some people don’t make excuses.  Instead, they make rational choices.  We conduct our lives properly so that we live within our means, pay our bills, save our money and don’t find ourselves facing disaster every time it starts to drizzle outside.  We make intelligent choices.  We, apparently, are fools.

It would seem that living within your means is a good idea.  We live without all the bells and whistles that others absolutely need to have.  We don’t concern ourselves with shiny things.  If we can’t afford something, we just keep walking.

When we buy a house, we put money on the table as a downpayment.  We don’t take out a mortgage we can’t afford to pay.  And we don’t lie on our mortgage applications.

When we run our business, we look carefully at our paperwork to make sure that it’s legitimate.  We don’t tolerate, no less encourage, scams to skim a quick buck off the top and pass the garbage portfolio off to the next sucker, tied up in a pretty ribbon to make it look more attractive.  When we make a business mistake, we eat it.

And what’s our reward for making the hard choices necessary to live a life of personal responsibility?  We get to pay the taxes to bail out those who don’t.  We get to pay the taxes to compensate for the shortfalls of those who can’t because they spent their mortgage money on a new Mercedes.  They are driving around in a Mercedes that I am paying for.  You too.  Does that make you happy?

The news from Bear Stearns came after the bank had insisted for days that its finances were in adequate shape. But its chief executive said the bank’s liquidity had “significantly deteriorated” since Thursday. “We took this important step to restore confidence in us in the marketplace,” the executive, Alan Schwartz, said in a statement.

But there was no confidence, and there should be no confidence.  They have a liquidity crisis for a reason.  Actually 1.9 billion reasons.  And it’s not like it hasn’t been coming for a while.  Nobody wanted to look too closely.  Nobody wanted to believe.  And now the  domino theory rears its ugly head.

What incentive is there for individuals or business to play it straight, tell the truth, act responsibly?  So that you can be the last man standing when it comes time to collect to pay the bailout everyone else?

One guy’s having a great time, living large, and deep in debt.  Another guy lives frugally, pays his bills and saves his money.  Which guy wins?  We really need to rethink personal responsibility.

Update:   JPMorgan to buy Bear Sterns for $2 per share.  It was trading at $100/share, down to $50 last Thursday.  Not a bad deal, I supposed.  Wonder if the bailout comes with the territory?  H/T Volokh