Libertarian law professor Richard Epstein, who advises "several" hedge funds on the legal issues surrounding the government's seizure of Fannie Mae and Freddie Mac from their private shareholders, has a wonderful column on some of the very important issues involved.
He writes: "the behavior of the U.S. government over the past five years has been marred by grave legal violations of bedrock principles underlying corporate, administrative, and constitutional law...The whole sorry episode represents a form of serious government coercion, with public officials attempting to run roughshod over bedrock principles of corporate, administrative, and property law. ...This dispute involves lots more than a simple battle over the proceeds of profitable ventures. All capital markets depend on the strong protection of the rule of law so that firms that invest their capital today can be confident that the government will not steal it away by stealth and artifice tomorrow, which is just what is happening now on a multibillion dollar level.... one more sober reminder of how far the nation has drifted from the sound and enduring principles of strong property rights and limited government."