Columnist: Some people argue that the government should not take over failing private-sector banks because the govern...

shunhe on August 21, 2020

Hi @ruchitaj,

Thanks for the question! So let’s take a look at what the stimulus tells us. We’re told that some people argue that the government shouldn’t take over failing private-sector banks, and they say so because the government just doesn’t know how to manage financial institutions. But, the columnist says, the government wouldn’t have to manage the day-to-day operations, but just pick the senior management of the bank. The argument then draws an analogy to how politicians pick military professionals without being military professionals themselves.

Now we’re asked for what is most likely to be false out of the columnist’s statements. (E) tells us that the government shouldn’t take over private-sector banks that are financially sound. Does the argument give us reason to think that this is false? Well, the argument overall thinks that the government should take over failing private-sector banks, and it doesn’t make any distinctions between financially sound and financially unsound banks. So we can’t infer that (E) is false based on what we’re told in the stimulus, and that means that it’s the wrong answer for this question.

Hope this helps! Feel free to ask any other questions that you might have.