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Congress bailed out what was then known as Lockheed Aircraft in 1971 and Chrysler in 1979 with loan guarantees. In 1984, the failing bank Continental Illinois was effectively taken over by the federal government.

After the Sept. 11, 2001, terror attacks, Congress quickly authorized $5 billion in cash to help shore up the airline industry and followed up with $10 billion in loan guarantees. It set up a compensation fund for victims of the attacks.

While complaints of unfairness can always be raised, government bailouts can generally be defended when the government's failure to act could have dire consequences on society or the nation's financial system, said William Galston, a former domestic policy adviser to President Clinton and now a senior fellow at Washington's Brookings Institution.

''Sometimes, you have to act in a very broad way, a way that's not very sensitive to the distinction between the innocent and the guilty, in order to bring about a broader public good. And then you sort it out later if you can,'' Galston said.

Even President Bush seems torn between not interfering with market forces and wanting to keep the financial crisis from deepening.

On March 14, he inveighed against government bailouts. ''The temptation of Washington is to say that anything short of a massive government intervention in the housing market amounts to inaction. I strongly disagree with that sentiment,'' he told the Economic Club of New York. ''I believe there ought to be action. But I'm deeply concerned about law and regulation that will make it harder for the markets to recover.''

But, a week later, Bush applauded the series of dramatic government interventions undertaken by Fed Chairman Ben Bernanke and Treasury Secretary Henry Paulson, claiming they had ''acted swiftly to promote stability in our financial markets at a crucial time.'' He even thanked Bernanke for ''working over the weekend.''

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