What's the difference between a capitalist and a socialist?

Apparently, about 3,000 points in the Dow Jones Industrial Average.

Back when the DJIA was up at 14,000 and climbing — about nine months ago — tough-minded capitalists were explaining that government intervention was always bad for the economy. For example, if homeowners got suckered into bad loans they couldn't repay and were about to lose their home, that was their own fault — fools have to pay the price for being fools.

Failure, after all, disciplines the system. With reward must come risk, and all that. The attitude was captured all too well in an e-mail from the head of Countrywide Financial, responding to a plea from a Countrywide customer desperate for more time to repay his loan.

"It's unbelievable ... disgusting," wrote Angelo Mozilo, CEO of what was then one of the largest mortgage companies in the country.

But the tune has changed. With the nation's financial system teetering at the brink — the consequence of mindless risk in search of immense reward — Wall Street's rugged masters of the universe are running to Uncle Sam in panic, falling to the knees of their $2,000 tailored suits and screeching, "Help us, help us, help us, oh please won't you help us!!!"

All of a sudden, John McCain says the federal government has to commit billions of dollars to bail out Fannie Mae and Freddie Mac, even if it means nationalizing those privately held companies. Treasury Secretary Henry Paulson, a former CEO of Goldman Sachs, tells Congress that Wall Street needs tighter regulation and Federal Reserve Board Chairman Ben Bernanke announces that the Fed will make loans to troubled financial firms and accept questionable investments as collateral, in effect putting the rest of us on the line for their debts.

In other words, after years of privatizing their gains and reaping immense financial rewards through their manipulation of the "free market" system, the leading lights of Wall Street are suddenly turning socialist. Now that it's time to pay the piper for risk gone bad, they turn to government and ask, "Hey, buddy, will you get that for me?"

And unfortunately, government has no choice but to do so. If it's not quelled, the panic now rippling through corporate boardrooms and financial houses threatens to do significant long-term damage to the economy not just of the United States but on a global scale as well.

It sure is strange to see, though. Suddenly, government has become the capitalists' best friend. Suddenly, the idea that government is here to help doesn't seem quite as funny to Wall Street as it used to be.

There's no doubt that excessive government regulation can strangle free enterprise. But as we're witnessing, excessive greed can do the job even more quickly. Managing a modern economy requires that we find a useful balance between greed and government regulation, and over the past decade or longer, we lost that balance.

Had we accepted the necessity of a bit more government regulation and intervention to tamp down the excesses of a market economy, we would need a lot less government intervention today to rescue ourselves from what looks to be a very large mess.

— Jay Bookman, for the editorial board (jbookman@ajc.com).