The perils of bailouts

"The European Union bailout of Ireland and its previous bailout for Greece, when examined closely, bore a distressing resemblance to the 2008 US bailouts of Bear Stearns, AIG and Citigroup. The authorities poured more resources into assets that had been shown to be defective, without sufficiently enforcing the painful purging and liquidation that was necessary. By doing so, they reduced wealth, prolonged recession, and made the eventual collapse of the global financial system more likely. "