Banks do take the loss via bankruptcy, or people just not repaying. If the banks had lobbied the government to repay these debts with taxpayer money, I would a

Banks do take the loss via bankruptcy, or people just not repaying. If the banks had lobbied the government to repay these debts with taxpayer money, I would agree that this was trying to eat their cake and have it. But the government's actions go too far in the other direction. They impose a loss on the banks that the banks would never have expected or priced in.