Another reason for private sector involvement (PSI) is to minimise the taxpayer’s contribution and to penalise bad investments. This reason is even less economically sound. Lehman Brothers’ failure proved that if PSI is applied in the wrong way, the taxpayer will in the end pay more. Short-term speculative investors benefit from perverse forms of PSI, while long term investors are punished.
[25] Minouche Shafik (2021) What We Owe Each Other: A New Social Contract for a Better Society, Princeton University Press  ©2023 Central Bank of Ireland