I don't see the moral hazard in making the depositors whole as long as they weren't given juicy rates for putting their money in the bank, it's not that they st

I don't see the moral hazard in making the depositors whole as long as they weren't given juicy rates for putting their money in the bank, it's not that they stood to gain anything from the mismanagement of the bank. When the alternative is that a lot of deposits in smaller banks flee to the huge banks that would have to be backstopped anyhow, starting fires all over the place, it seems downright attractive to signal that depositors don't have to worry.