Kudos to the U.S. Treasury for making the bailout plan better. Taxpayers should prefer “helping” banks make bad loans disappear to just removing horrendous debt from their books in one swath.

Kudos, too, to European governments for doing this first and showing the smarter course of action.

At the onset, the rushed nature of the bailout through Congress conjured fears of unintended consequences. It was paralleled with other hasty lawmaking, like those regarding Iraq or the initial Patriot Act, as a warning against moving too quickly through fear, not wisdom.

These concerns were accurate. One of the hallmarks of this financial meltdown has been what isn’t known, like the whole scope, nature, causes, actual or prospective losses to business and taxpayers.

All that was known was the presence of panic.

This allowed a bailout bill that was hated with unusual bipartisan ferocity to be enacted. It was thought, against the garish backdrop of global economic ruin, that government must act as rescuer, instead of savior.

This meant attacking the problem, not devising a solution. And the solution was ugly: Use taxpayer dollars to buy bad debt off the market, to remove this cancer from its institutions. It was, at least, a plan.

But it felt rushed. As it turns out, it was.

While Congress was embroiled in this debate, European governments hatched a better plan – partly nationalizing insolvent banks – to stabilize markets without absolving them of responsibility for their lending.

(Yes, part-nationalizing runs afoul of free market tenets. But, as many observe, these were already corrupted, first with Bear Stearns and last with AIG. The government’s proverbial nose was within the fiscal tent.)

This global approach has made the market react gleefully, with the Dow zooming some 900 points upward on Monday. A global approach was missing, we had pointed out, in the first versions of the Congressional bailout bill.

What this response proves is the market needed confidence more than capital. The Treasury and Congress could have vowed billions, but without assuaging fears of collapse, the market still would have fallen.

Just as we cannot drill our way to energy independence, we also cannot write a check out of this quagmire.

Stability is needed. Forced partnerships between government and banks should provide it. And as long as these are shotgun marriages, the cuddly intimacy that doomed Fannie Mae and Freddie Mac should be nonexistent.

We think the government has learned its lesson about being too vested in the mortgage business.

In short, this latest idea is more palatable than the bailout. That tasted bitter.

This one, at least, tastes bittersweet.