The Wall Street Journal leads its page one with a three-column second-day piece on the nationalization of UK lender Northern Rock. The paper sees the government bailout ball beginning to pick up speed as it rolls down the hill. Where are the market fetishists now?

In the U.S., the government’s role has so far been limited to orchestrating private-sector rescues, pressuring mortgage lenders to cut deals with borrowers and cushioning the blows to the economy with fiscal stimulus and interest-rate cutting. But proposals to use federal money to ease the pain are getting serious scrutiny in Washington.

The U.K. government’s decision could also mark the beginning of a new and more acrimonious stage of the financial crisis, in which the moves of governments and regulators inevitably impinge upon the interests of powerful groups.

The FT and The New York Times reports that rival banks are ticked off, saying the now government-run-and-backed bank puts them at a competitive disadvantage.

The Journal reports that the Bush administration is playing it both ways when it comes to free trade and national security. Just weeks before the U.S. started raising hackles about industrial espionage, the administration loosened standards for trade of goods that can have dual military and consumer uses, even fast-tracking two Chinese companies with extensive ties to the Chinese military.

The WSJ says an ex-employee of Lichtenstein bank LGT Group handed the German government data that prompted its ongoing massive roundup of tax evaders, including the CEO of Deutsche Post AG, who has resigned. While rogue traders have been in the region’s news lately, this resurfaces the more problematic rogue-nation issue.

The problem is so bad that the German government paid more than four million euros to the ex-employee to hand it confidential data from the bank. That sounds darn near like governmental overreach until you consider that Lichtenstein is one of those places that protects your friendly neighborhood criminal who needs a safe place to park his ill-gotten money.

Why is this still going on in this day and age?

Liechtenstein has long been a destination for the undeclared funds of wealthy Europeans. Often, money is driven across the border and delivered in cash to local banks… Liechtenstein, alongside Andorra and Monaco, remain on a shrinking list of so-called uncooperative tax havens drawn up in 2002 by the Paris-based Organization for Economic Cooperation and Development. Liechtenstein still makes a distinction between money laundering and international tax evasion when it offers to help with international investigations…

Far be it for us to suggest Germany squash a smaller, incorrigible neighbor, but it seems like its time to end Liechtenstein’s piratical run.

Wrong answer: GE spokesman Russell Wilkerson on why its chief accounting officer is resigning in the midst of an accounting scandal that just won’t quite go away: “Mr. Ameen’s decision to retire had nothing to do with this probe. It was his personal decision and he had been planning to retire.” The Journal disagrees, citing multiple sources as saying the to-do contributed to the CAO’s decision to quit.

In a big win for consumers and for Sony, Blu-ray has won the battle over the next-generation video format. Several publications are reporting that Toshiba is pulling the plug on its HD-DVD format, enabling consumers to move without trepidation into the post-DVD era.

Still, the win means less than it would have, say, a year ago. As with music, video consumers seem to be moving away from hard-copy multimedia in favor of instant-gratification, high-definition downloads, now available from the likes of Netflix and Apple.

The Los Angeles Times pays needed attention to the housing bust under way in Britain on its business front page. In many ways similar to the crisis in the U.S., the UK is having similar impacts on homeowners and is another stressor on the global banking system.

Quote of the Day:

“Financial institutions have been pretty good at taking governments hostage,” said Charles Wyplosz, an economics professor at the Graduate Institute in Geneva. “The taxpayer is likely to face a huge bill.”

Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu.