What do you do when your economy is in the crapper?

Apparently, you have at the problem with a $700 billion U.S. plunger bought by taxpayers, made necessary because of the 'wisdom' of overfed bankers who turned out to be full of shit.

As the financial crisis in the United States worsens, a lot of people are having bittersweet, I-told-you-so moments.

See, smart people knew the U.S. financial juggernaut was a sand castle waiting to be washed away by the right kind of wave, and that wave came in early 2007 in the form of the subprime-mortgage crisis. By July of this year, banks and financial institutions were reporting total losses of $435 billion U.S., and the Dow Jones Indices were being battered by huge daily dives. Average Americans were losing their homes, and the institutions that floated them dangerous loans were crumbling - and taking the U.S. economy with them.

And people saw it coming.

It started back in 1970, when a new generation of politicians and business leaders ignored American history and began emasculating the government's regulatory powers. They sacrificed all kinds of laws to free-market capitalism, and after getting through industries such as transport and communications, they started on finance.

By 1999, the Financial Services Modernization Act came in to being, repealing Depression-era legislation aimed at preventing banks from going tits-up due to excessive conglomeration, corruption, mismanagement and the inevitable tankings of the stock market. The act paved the way for mergers between financial giants and created a situation in which a select few incredibly wealthy institutions were allowed to dance drunkenly on the Wall Street tightrope with no safety net below.

"Legislation first adopted to save American capitalism from the consequences of the 1929 Wall Street Crash is being abolished just at the point where the conditions are emerging for an even greater speculative financial collapse," Martin McLaughlin wrote in '99.

Nevertheless, the smoke cleared and huge corporations such as Citigroup were the reality, massive but rickety entities with so many thick tentacles that they could potentially be pulled down by a heavy weight tied to any one of them.

All this, of course, was done in the name of capitalism, free markets and Adam Smith's Invisible Hand, while government regulation was painted as unnatural; a byproduct of communism. No, Americans instead placed their trust in the rich men with marionette strings biting into their chubby fingers.

And then the whole thing came crashing down in the space of about two-and-a-half years when the housing bubble popped and the stock market lost its horns. Financial institutions have failed, stocks have plummeted and many have people watched their life savings disappear as banks and investment houses reveal they've just rolled snake eyes after a fast and loose game of craps.

So how to fix things, to restore stability to markets and to erase the errors of corporations that treated the economy like the glory hole at a rub-and-tug for so many years?

Well, how about George W. Bush's suggestion that $700 billion in taxpayers' money be funnelled into failing enterprises as one of the largest corporate-welfare bailouts in history?

I understand the economy is so shaky as to require some action to be taken, but don't expect me to be taken when the suits belly up for a feeding at the public trough after decades of pushing the government out of the economy.

To me, it looks like the Invisible Hand just gave taxpayers the finger.

Mike Warkentin is counting his pennies.