Subsidizing Irresponsibility?

Writing in City Journal, Nicole Gelinas argues against "Too big to fail." An excerpt from her review of its history:

Federal Reserve chairman Paul Volcker told Congress that the decision to protect uninsured lenders of a private institution from the consequences of a freely assumed risk wasn’t meant to set a precedent. But the federal comptroller of the currency, which regulates banks, made clear that a shift in policy had taken place, telling Congress that none of the nation’s top 11 banks would be allowed to fail. Small banks were apoplectic. Jokes flourished about investors’ not wanting to put money into the nation’s 12th-largest bank. “How often and to what extent can the government, and in turn the taxpayers, prop up any institutions that are neither the nation’s best or brightest?” wondered the Independent Bankers Association of America.