Tonight’s reading:

Princeton Economist Krugman: Bailout 2.0 by this weekend or else:

“… it will be very alarming if this weekend rolls by without a credible announcement of a new financial rescue plan, involving not just the United States but all the major players.…the only things anyone wants to buy right now are Treasury bills and bottled water…  You may think that things can’t get any worse — but they can, and if nothing is done in the next few days, they will.“

NYU Economics Prof Nouriel Roubini presents a grim assessment on his blog tonight:

“The US and advanced economies’ financial system is now headed towards a near-term systemic financial meltdown .. [this] crisis was caused by the largest leveraged asset bubble and credit bubble in the history of humanity..”

Even with aggressive coordination we could see near-term bank or market closures and otherwise fitful times.  I reiterate my advice that you each seriously consider a personal or family contingency plan for a potential four-alarm banking emergency.  This may seem unlikely – but it’s no longer out of bounds in pleasant conversation.  We discussed this very delicate issue in a bit more length here, and I’m hoping to write a little more about it in the next couple of days.

Sorry it’s been a little bleak around here lately.

It’s interesting to watch Europe grapple with the global finance fiasco.  Until today I had not given a lot of thought to the much more complex policy environment they face with regard to the Euro.  They have a single currency, yet no single government body nor bank to manage associated monetary policy.  So, “internally” coordinated responses are nearly impossible.  Milton Friedman once said the Euro was unlikely to survive its first recession.  This will be another interesting dynamic to watch.

Related articles:

• Thought Experiment: Breaking the Euro

Valleywag picked up a FriendFeed discussion between a few of us yesterday regarding the bailout bill within which Scoble blames “people like [me]” for the coming “breadlines”.  It rings a little hollow considering where I’ve been on all this and where he’s been (i.e. nowhere), but it brings a much more important issue to the fore.

To the thread in particular, I realize how acerbic my tone can be when discussing such things and try to be cognizant of that every time I write.  Sometimes my frustration – the result of a bit too much anguish about our national slumber – gets the best of me.  But Americans sat mostly silent as international and domestic crimes were perpetrated in their names and their economy was wrecked – choosing to glide along as if they had far more important things to think about.

Robert is right to describe the financial mess as the result of our collective idiocy.  The bill for one or two generations of stupidity has now come due and our remaining credit cards have been declined.  And for the moment, the social media characters participating in the specific tendril of web masturbation that is Robert’s “what to do” post have come up substantially empty.  So, I’ll see what I can come up with.

Louis Gray tells us the lesson from the long-foreseen economic crisis ought to be that there are no experts. I think that’s bullshit.  Perhaps in a stock-picking context it’s partly true, but the broad conclusion is flawed.  Historically in such things, there exists, in fact, those who were right and those who were wrong.  The arguments that were made on each side, and the subsequent decisions we made as a nation.   Yet, we are compulsively eager to skip over that kind of reflection and self-analysis, all too quick to “move on” and shelter ourselves from the requisite soul-searching that might illuminate us as to how, exactly, we arrived there in the first place.

And now – whether it was the War in Iraq, our brutalized Constitution, or the global credit fiasco now caving in on our heads – our tendency to continue listening with nary a critical whimper to the very voices who led us astray is criminally derelict.  We are heavy sleepers indeed.

It is now too late to escape serious economic pain; I won’t go into it all again here.  Rather, in the spirit of Robert’s sincere quest for solutions, I will suggest a serious way we can work together to fix the systemic ills that brought us to this place.

I’m not asking you to give up your gadgets nor to stop blogging about blogging.  Social media is unquestionably transforming our global culture and our politics.  But let’s devote less energy to the tools themselves and more to the fuller realization of their potential.  I suggest a little less time navel-gazing and a little more time using your voices, tools and networks to catalyze broad, deep, honest conversations about public policy.  And it will be contagious: in doing so, you will set an example for the millions who will see and hear you.

Scoble is also right that it is not without hope.  So, all of you: call your legions to arms.  Tell them a national emergency requires that they spend an hour a day seriously evaluating the American way of life, thinking critically about where we stand as a nation, how we got here, and how they might help in the rebuilding.  This is not politics; this is hardcore societal bodywork.  We face a national existential crisis — please consider that it’s at least possible this is not a bump in America’s road, but a big, dark, howling crevasse.  And as we speed toward it, contrary to popular mythology the people in charge aren’t in the White House or in the boardrooms of corporate America; they are buying shit on eBay and watching The Bachelor.

The Great American Experiment – for all its warts, the most successful social startup in history – is in serious peril, and only an awakened citizenry can restore it.

So, social media stars: ask your readers if all of this is what they had in mind for America and the world when they first formed their ideals about their country and their world.  Ask them if they want to talk about a society that is open, fair, honest, and free – or if they want to actually ensure it.  Give them homework; for a timely example, make them sit through Bill Moyers’ interview of Colonel Andrew Bacevich.  Command them to sit, open-minded, and listen to the whole freaking hour.

Ask each reader to take immediate steps to get vigorously involved in a political campaign, public policy issue, or a nonprofit they care passionately about.  It doesn’t matter what or who the cause is, so long as it stirs them to their core.  Tell them to call, write, show up for shit, volunteer, even give a few bucks if they can.  Ask them to do the things that make their hair stand up.  Whatever it may be, press them to take concrete steps toward nourishing something bigger than themselves – and demand that they to it today.

Tell them to “tithe” their time; for every hour they spend aTwitter or aBlogging, ask for 10 minutes toward something for their country, their planet, or their fellow human being.  Press them each to seriously commit a certain percentage of their time to something that, in their eyes, is likely to improve the human condition.  Not to spend this time – but to invest it in the collective good; to view it as a massive global-citizenship 401(k) in which we are all shareholders and beneficiaries.

And regularly inquire of your leagues as to how they are endeavoring, every single day, to evolve the nation and world they live in.

That’s what to do.