Library Journal
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For nonlawyers seeking a closely argued, technical attack on the mechanics of recent federal bailouts, this work by Posner (Kirkland & Ellis Distinguished Service Professor of Law, Univ. of Chicago Law Sch.; The Twilight of Human Rights Law) is the top choice. Heavily footnoted, with extensive references, it provides the legal and policy underpinnings for claims made by Posner's former client, Starr International, against the United States. The case, and one fourth of the book, concern the government bailout of insurer AIG. Starr was its leading shareholder; Posner argues that the government, in extracting a large ownership stake from AIG in return for financing, violated the U.S. Constitution. Posner wants the government to be a lender of last resort, but thinks that the laws must be fixed because the old bailouts were illegal. Whether Congress will entertain his prescriptions is another matter. Starr won at trial but received no damages. It lost on appeal and is now asking the Supreme Court for review. VERDICT For academic and sophisticated audiences.-Harry Charles, St. Louis © Copyright 2018. Library Journals LLC, a wholly owned subsidiary of Media Source, Inc. No redistribution permitted.

Book list
From Booklist, Copyright © American Library Association. Used with permission.

Adding to the plethora of works on the 2007-8 financial crisis, Posner (The Perils of Global Legalism, 2009) focuses on the U.S. government, which bailed out companies facing the disastrous results of irresponsible and borderline-illegal actions. Rather than blaming the government or the corporations, though, he emphasizes how outdated the rules regulating these corporations are and how the public would be better served in future financial crises which he posits are largely unavoidable by changing the law. He also calls on the public and media having more flexibility in their thinking about how the economy should work, including a greater acceptance of occasional failure. Overall, Posner claims that there has been too much concern with who wields the most power the government or the corporations and not enough with what is best for the country.--Tosko, Michael Copyright 2018 Booklist

Publishers Weekly
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Legal scholar Posner (Law and Happiness) revisits the financial meltdown of 2007-2008 and the immediate government response to it and makes a case for expanding the powers of federal agencies to intervene economically before another catastrophe occurs. Taking his book's title from the Federal Reserve's official function as the "lender of last resort," Posner adopts the unique approach of homing in on the legality of specific actions rather than their political or pragmatic merits. To bolster his argument, Posner examines three of the highest-profile government interventions during the crisis-those concerning insurance giant AIG, mortgage lenders Fannie Mae and Freddie Mac, and auto titans General Motors and Chrysler. Basing his argument on interpretations of relevant clauses of the Federal Reserve charter and the U.S. Constitution, Posner demonstrates how the government's actions expanded, bent, and (possibly) even broke the law, in the last case by taking equity from AIG in return for an $85 billion loan. He contends that expanding the government's powers now-including to provide much-loathed bailouts to financial giants-would eliminate the need to stretch the law in such a way again. Unfortunately, Posner's insightful analysis gets lost in a sea of jargon, such as "financial haircut" and "the floating leg of an interest rate swap," limiting his topical book's audience to fellow experts. (Mar.) © Copyright PWxyz, LLC. All rights reserved.