America's borrowing party is over, and the bill is due

Here's one example of how "progressive" ideas fall victim to tough times: The City Council in Atlantic City has reversed the smoking ban inside the city's casinos, enacted just this year. The anti-smoking movement has suffered this surprising setback because gaming revenues are falling and a lot of casino employees are losing their jobs. It is hoped this will spark some upturn in business, and offset a competitive disadvantage with slots parlors in New Jersey's neighboring states that allow smokers to shorten their lives while gambling.

If one wants to know the way the wind is blowing, it's much better to pay attention to this kind of development than to listen to Treasury Secretary Henry M. Paulson Jr. explain another of his changes in strategy in bailing out/rescuing/investing in or otherwise trying to stem the relentless deleveraging of the world's economies.

Just to cheer myself up the last few days, I've been reading through the latest edition of Manias, Panics, and Crashes: A History of Financial Crises, by Charles P. Kindleberger. I've always enjoyed looking at the history of man's economic pathologies and how they all resemble one another. Mr. Kindleberger was amplifying and updating the timeless work of the dour Scot Charles Mackay, who published his Extraordinary Popular Delusions and the Madness of Crowds way back in 1841. One famous quote from the book that has great explanatory value is, "Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, and one by one!"

As the prophet explained, "There is nothing new under the sun." It's good to have this in mind as the politicians keep trying to figure out how we can possibly save ourselves from ourselves when things have deteriorated to this extent. Judging from the response last Friday to local Congressman C.A. Dutch Ruppersberger's appearance on my show, a lot of people don't think the politicians in Washington have any answers the people can believe in.

He says it took courage for elected representatives to ignore public displeasure and pass that $700 billion-and-counting bailout bill. What about having to sweeten it with $150 billion in earmarks, pork barrel projects, whatever you want to call them? Well, the legislators are good folks, he said. What should we call a typical session of Congress - "When good people do bad things?" (You can listen to the Ruppersberger radio interview by going to my page at WBAL.com).