Hank Paulson’s bail-out of the financial industry will cost taxpayers $700bn. Some believe that the bail-out signals an abandonment of the Reagan Republican goal of limited government. That debate is under way.

Those who think Republicans have ditched their limited-government aspirations point to the Bush administration’s reflexive “throw money at it” response to every crisis. In 2001 the first response to September 11 was not to attack al-Qaeda, but to pass a $20bn domestic spending programme. The response to Hurricane Katrina was $85bn in public spending. The collapse of AIG, the insurance giant, cost $85bn; Freddie Mac and Fannie Mae a further $42bn. And now we have the pièce de résistance – the opening bid of $700bn for the financial bail-out of Wall Street. Got a problem? We throw money at it.