I think (pun intended) it was Robert Jay Lifton in an interview on NPR a couple years ago who said that people tend to get into a kind of group-think mindset when they remain in a particular environment, to the point that they become completely blind to any other perspective. The discussion then had to do with high-ranking military personnel who lived a kind of 24/7 pro-"military-as-solution-to-everything" existence that provided them with only one viewpoint's input, and specifically then on the Iraq situation. Only after they moved outside that environment -- and I believe Anthony Zinni was the example cited -- were they able to get the multiple-viewpoint input that allowed them to make more rational decisions.

Paulson & Bernanke et Cie. are not getting any other input. Everything that's getting to them, and therefore everything that's coming out of them, is informed by their environment. It's entirely, without exception, framed by a "we have to save Wall Street and the brokers and the bankers and the rest of 'our' folks." There's no input on the fate, feelings, and futures of the other 379,995,000 of us.

For instance, has anyone worked up a model, computer or otherwise, of what would happen if Bear Stearns had just failed? What dominoes would it have taken with it, and how much better off or worse off would the world economy be? What about Lehman and Merrill and even Frannie?

What would happen if we "sacrificed" the multi-billion-dollar fortunes of the richest 1000 people who made their fortunes off hedge funds and CDOs and CDSes, etc? After all, we have a government that does not hesitate to sacrifice 5000 mostly American lives in the pursuit of victory in Iraq and considers it a bargain. Is it any less patriotic to go to the people whose greed directly caused this catastrophe and demand that they give back all the stolen loot? I mean, it's not like we're going to kill them or even put them in jail. They just have to put the money back.

The question remains, of course, how do they do that, especially if the money never existed in the first place. Well, what would happen, seriously, if they took their write-downs, canceled the CDS insurance contracts, decided it was all just a game, and started over? Is that possible? Is there a way to do it? (Does that put AIG back in business?)

The REAL economy -- not the computer-model financial one that doesn't grow any food or manufacture any widgets or provide any real services -- is the one that matters. Unless the bail-out addresses that -- and I doubt it will -- nothing's going to change. Will the bail-outs fix the system? No, because they aren't addressing the problem. It's like bailing out a leaking boat; if you don't plug the leak, you're not making any difference and the boat's gonna sink eventually anyway.

Those of us here on the bottom of the Ponzi pyramid have little leverage. And yes, pun most assuredly intended. If we work for wages, we have little to no control over how our taxes are taken from our paychecks or what taxes are tacked onto the purchases we make of goods and services. Most of us don't have the financial wherewithal to buy gold or silver as heges against inflation. There's not enough gold and silver to go around anyway; most of us will end up relying on the existing monetary system. So we're screwed. And what is our only other real hedge against individual and personal catastrophe? It's to establish our own nano-economies of the old-fashioned sort: providing real goods and services. Growing our own food. Making our own clothes. Sharing homes. Exchanging essential services like roof or auto repair for food or clothing or whatever. And it seems to me that that alternative is the perfect illustration of what's necessary on the larger levels, from micro through macro.

But what do I know? Well, I'm beginning to think I know a lot more than Paulson and Bernanke and some of the other idgits who are setting policy. For one thing, I know my model works in the real world, outside the electronic wizardry of a computer.

An old joke -- There are only 10 kinds of people in the world: Those who understand binary and those who don't.


Off to labor at my just-under-subsistence gig,

Tansy Gold