IN AUGUST 1989 Congress made history when it earmarked about $115 billion to liquidate or to reorganize insolvent savings-and-loan associations (S&Ls). By far the largest single example of government financial assistance to any economic sector, the aid dwarfed the earlier "bailouts'" of New York City in 1975 and of Chrysler in 1979 by factors of some fifty and eighty, respectively. How did we come to this pass? What lessons can we draw from our expensive mistake?