If a child is never allowed to face the consequences of their actions they will never learn.
If there's any ground for further actions against the management of the banks, I'm fully supportive of that, but a bunch of bank runs would've hurt everyone but them more than them.
If government didn’t make it clear they were stepping in here, what do you think would have happened first thing Monday morning? Every small/medium business would have seen the writing on the wall and moved their funds out of small/medium banks and into the handful of “too big to fail” megabanks. Stepping in and making up the cost prevents contagion.
The 250k limit is somewhat of a red herring. If every depositor split their funds up to stay under the 250k limit, it doesn’t actually change the overall risk profile for the FDIC.
So you can get that risk-free extra 2% on your deposit up to 250k, or up to hundreds of millions, and the government will just pay in fine. That opens up new area of business imho.
We need to balance letting the depositors suffer with causing a system wide run, so I think the FDIC/Fed choice was reasonable, but I would have rather seen them, say, guarantee uninsured deposits, less the interest of those deposits earned over the past 18 months.
But even if other bank runs didn't happen, there would be another consequence that I'm sure you wouldn't like either. People would understand that there are now two tiers of deposit safety: small banks where depositors might lose money above $250k if the bank fails, and "too big to fail" banks where that wouldn't happen (because they can't fail!). Everyone would move their deposits to the "too big to fail" banks, which would make those banks even bigger and more powerful.