On the Trail of "Bailing Out"

The latest headlines are dominated by news of the failure of the U.S. House of Representatives to pass a $700 billion "bailout" of the financial industry. As I explained on the Voice of America program "Wordmaster" last week, bailout in the financial sense, meaning the rescue of a bankrupt or near-bankrupt entity, is a figurative extension from the world of aviation. A pilot who needs to make an emergency landing bails out to safety. That part of the term's etymology is relatively clear, but figuring out its ultimate origin is a bit trickier.

In its latest revisions, the Oxford English Dictionary traces the verb bail out, meaning "to make an emergency descent by parachute from an airplane," back to 1925, when aviation was still quite young. An article from the Oakland (Calif.) Tribune from that year referred to a "pilot who has to 'bail out' hurriedly from a crippled or burning plane." The verb soon became a noun: a list of aviator slang appearing in the Lima (Ohio) News on Oct 12, 1928 explains that "a 'bail out' is navy slang for jumping out of a plane to make a parachute jump."

The phrasal verb bail out made the transition to the world of finance in short order, just in time for the Great Depression and Franklin D. Roosevelt's New Deal. Records from 1932 hearings of the Senate Committee on Banking and Currency include this: "They should purchase some additional stock, if I may use the term, to bail out the Government's investment in the home loan banks." And according to the Aug. 30, 1933 New York Times, an American Institute of Architects report on housing economics stated that "The purpose of rehabilitation must not be ... to bail out lending institutions whose mortgages are based on inflated land prices." (Sound a little familiar?) The noun bailout (or bail-out) in the financial sense also dates to the New Deal era: an article in the Oct. 9, 1939 issue of Time told of the Commodity Credit Corporation's plan to help out American tobacco farmers under the headline, "$40,000,000 Bail-Out."

So how did we end up with bail out in the first place? One potential clue is that the typical British spelling of the expression is bale out. That spelling suggests a historical relation to the noun bale, defined by the Visual Thesaurus as "a large bundle bound for storage or transport." To bale (something) out" thus evokes the image of letting a bundle out through a trapdoor, which is how those early aviators escaped from their planes before opening their parachutes. On the other hand, spelling it the American way, bail out, brings to mind bailing water out of a boat — or it could suggest getting someone out of prison by paying bail. These two senses of bail both go back to the Latin word baiulare "to carry a load," but via different French intermediaries: the "remove water" sense is from baille meaning "bucket," while the "release from prison" sense is from the verb baillier meaning "to take charge of." Bale, meanwhile, is unrelated, going back to a Germanic root probably related to the word ball.

Even though we're dealing with distinct etymological pathways, all three interpretations of bale/bail seem to commingle in the aeronautical sense of bailout, as well as the later financial sense. Think of the proposal to stabilize troubled American lending institutions. Is the plan to release them like a bundle out an escape hatch? Or to scoop them out like water from a leaky vessel? Or would they be freed from the prison of impending bankruptcy? All three images apply, and it isn't clear which one has historical precedence. It's somehow fitting that the origin of a name for a messy financial fix is itself pretty messy.