Is this the year America goes full-monty socialist?

Treasury Secretary Henry "Lenin" Paulson is sending up a test balloon about "plans for the U.S. government to invest in banks as the next step in trying to resolve the deepening credit crisis." The report adds, "The Treasury's program would be voluntary and officials may begin injecting capital through purchases of shares starting as soon as the end of the month."

OK, here's the deal: as voluntary as the purchase of stock in heavily regulated banks by their regulators may be (they're free to say "no"! Honest!), the process of government acquisition of private businesses belongs to an ideology called socialism.

I'm not just engaging in knee-jerk reaction to this rise of the red flag over the U.S. Treasury, either. Paulson proposes to risks enormous quantities of taxpayer money on investments in an industry that's in the midst of a thorough shakeout. That's a game best played by savvy investors with their own money, not government officials with cash picked from other people's pockets.

And if these investments are successful, it will give the government unprecedented control over the financial sector, with all of the concentrated power that implies over the rest of the economy. Where will companies get their financing? From government-controlled banks. And will banks' lending policies remain better-divorced from political priorities than did the policies of Fannie Mae and Freddie Mac, which were run into the ground (at great cost to the U.S. economy) as tools of lawmakers' schemes? Don't count on it. Governments are all about politics, and politics will govern the way banks owned by the government are administered.

To put the financial sector in government hands is to give political officials enormous and far-reaching power over the rest of the economy.