Over the past couple of weeks, it's been pretty crazy here in Houston between the pre-Hurricane Ike hype and buildup to the post-storm aftermath.  But things are getting back to normal here, so I'm planning on resuming a more regular schedule of blogging.

One of the major news items over the past couple of weeks not related to the weather has been the financial sector "crisis" (every problem is called a "crisis", so I hesitate to use that word) and the resulting government bailout using our tax dollars.  I thought, however, that this article by National Review's Deroy Murdock was a great example of how we could at least deal with the federal takeover of Fannie Mae and Freddie Mac in a free market capitalist fashion.

Excerpts:

[P]our [Fannie Mae's and Freddie Mac's] assets into a new, temporary agency whose legal authority expires within 90 days. The Asset Breakup Corporation will supervise Fannie and Freddie’s orderly dismemberment and sale in much smaller pieces.

...[U]se Fannie’s and Freddie’s databases to create a list of their customers ranked alphabetically according to the individual homeowners’ surnames.

The first set will contain people whose surnames begin with the letter “A.” Americans named Aaronson, Adams, Alvarado, and Antonucci. The second will consist of those whose surnames begin with “B.” People named Baca, Benson, Berkowitz, and Brooks will compose this category. Next, people surnamed Caruso, Charles, Chavez, and Chung will populate the “C” group.

This simple method soon would divide Fannie’s and Freddie’s assets easily, fairly, and transparently into 26 distinct slices.

This method automatically would minimize risk. Rich people and poor folks, hard workers and slackers, cheapskates and spendthrifts, city slickers and country bumpkins, Southerners and Northerners, Pacific surfers and Atlantic lobstermen, blacks and whites, the young and the old, and everyone in between are scattered evenly and randomly across the alphabet. The “A” group, “D” group, or “W” group all will include many diligently paid mortgages and some turkeys. Some mortgage owners will live in thriving communities while others will reside in sleepy little towns. Some will bask in the Sunbelt while others endure endless rain.

By evenly spreading risk this way, any business that purchases these blocks of former Fannie and Freddie assets will be confident that there will be enough performing mortgages to compensate for those that have gone sour. ...

...Auctioning off these 26 units will determine what proportion of this price the market is willing to bear. This price-discovery process would be far preferable to having the government cheat taxpayers out of potential cash by charging prices that are too low, or attenuating the current mess by charging prices that potential buyers will not pay, thus marooning these assets even longer. ...

...These 26 companies should be sold to the highest bidders in open outcry auctions accessible to the general public and members of the news media. ...

...[O]nce banks, hedge funds, private-equity companies, pension funds, or whoever purchases these assets, the new owners will be responsible for contacting mortgage holders and making payment arrangements. For many, it simply will mean giving them new addresses to which to direct their monthly checks. Other people will need to work out payment terms or take other actions to normalize their affairs.

I've heard several different ideas of how to deal with the various bailout options, but this seems the most simple, fair, and market-based method.