Steve Randy Waldman on the Link between the Financial Crisis and Open Democracy

Over the weekend I came up an idea as to how civic media can help resolve the worsening global financial crisis. A format idea. I mulled it over and now it's a bud about to bloom. And today along comes Steve Randy Waldman with a post that fertilizes it:

I've just listened to NPR's recent interview of Timothy Geithner. Adam Davidson did a great job of trying to get answers from Mr. Geithner. I felt sorry, at a personal level, for our Treasury Secretary, a very smart man imprisoned in a series of talking points, desperately afraid of the consequences of holding an honest conversation.

As an aside, we've come to take it for granted that policymakers ought to be circumspect for fear of provoking traumatic moves in the markets. But isn't that dumb? Markets are supposed to be about aggregating and revealing information. In what sense is it "more responsible" to hide information or ideas so that markets do not move on them? And if markets do misbehave so wildly that public officials can no longer afford to be candid because of market consequences, does that suggest an incompatibility between the kind of financial markets we have and open democracy? [my italics]

Waldman has the respect of other finance bloggers. And my format idea addresses the incompatibility he speaks of. Here it is. It's a windfall for CNBC, if they have the wits to run with it. Just remember where you saw it first. Alternatively, it can be done on the Internet. Anyone want to make it happen?

Imagine an American Idol-type reality TV contest of from eight to as many as sixteen rival solutions, presented by small groups of from one to four individuals competing for the prize of Best Solution to the Global Financial Crisis. Imagine this contest aired over a period of weeks or months primetime evenings on CNBC. Half the contestants might come from CNBC's existing on-air team and half from elsewhere and indeed anywhere: they could be finance writers and bloggers, Bloomberg reporters, financial institutions, universities here and abroad, and Vii's (Very intelligent individuals) with few credentials but great ideas.

Now imagine an on-air selection process, open to anyone, that winnows down hundreds of aspiring contestants to a field of eight or sixteen finalists, as happens in the first phase of American Idol. Finally, imagine the finalists advancing their solutions by interviewing anyone and everyone connected with the financial crisis, including even, conceivably, Timothy Geithner. Who could judge the contest? Who would govern it? How would contestants be selected? How would the government be involved at local, state and national levels? How would winners be rewarded? I have answers for questions these and other questions.

Read the rest of Steve Waldman's post - he would be one terrific contestant for this show.

What is "The Economy"?

In times of economic recession or depression, if we're going to fix it, or save it, or renew it, or let it heal itself - wouldn't it make sense to know what economy means?

Let's look at two definitions. The Oxford English Dictionary, in the first of many meanings, defines "economy" as "The way in which something is managed; the management of resources; household management.." I like this one. It points, I think, to the economics of the future. For two reasons. First, where people commonly think the of "the economy" rather passively - in terms of the health of markets - this definition speaks of economy in terms of the active role of managers in managing and regulating markets. In this definition, economy is not something that happens, but something that people make happen. The global financial crisis (and globalism itself) is forcing nations (central bankers) everywhere to accept, and accept in concert, this more active definition of economy. Especially with respect to regulation, centrals bankers can no longer afford to be mere spectators of sophisticated yet unregulated financial entities or practices.

Adam Smith spoke of the invisible hand that causes an individual as he advances his own self-interest to advance, invisibly, the well-being of his community as a whole as well. But the global financial crisis has made visible, has it not, the crude hand (pictured here) of those who turned markets worldwide into a giant Ponzi scheme. This brings home an obvious but neglected truth. While Mother Nature makes the weather, markets (while impacted by the weather) are the creation of human beings. To function, markets must be trustworthy: they cannot be rigged. More than this, given the environmental and education challenges confronting the world today, the markets of the future - the economy of the future - will perforce serve the public interest.

I like the OED definition of economy, secondly, because I believe the "resources" mentioned in it will in time include not just the labor and capital resources that have marked economics since the days of David Ricardo and Adam Smith, but also cultural and even spiritual resources as well. Enough said on this point for now.

Now let's look at a second definition. Wikipedia defines economy as "the realized social system of production, exchange, distribution, and consumption of goods and services of a country or other area." Note that apart from its cloudy reference to a "realized system" - to the thing managed and not its managers - this definition is silent on the function of management. It's vulnerable to the notion that economies, in their totality, take shape on their own, without human management. (OK, given the failure of central bankers worldwide to anticipate the current financial meltdown, this reading seems fair enough - but can the world allow this meltdown to occur again?)

Stepping back to look at world's plight today, I see the need for two kinds of leadership. First is the need for top-down, short-term triage stabilization of a broken financial system. But this top-down leadership, even as it repairs what's broken, can do so effectively only if it has a new financial system in mind, one that can be shared with and approved by the general public. I will go farther and say that the new system will necessarily draw its vital energies as much from ordinary citizens as from large corporations and investors.

This is saying a lot, I know. But democracy is a system of check and balances. And the "Great Disruption, as Thomas Friedman is calling the events of 2008, shows us that the direct involvement of ordinary citizens, will in the future be the only possible check on the tendency of financiers, when given the chance, to take not only finance but government itself into their own hands for their own benefit.

Does all this sound far-fetched? It should not to those who have a modicum of faith in the good sense of the American people. Recently Rick Santelli's "Shout heard round the world" jolted CNBC viewers and caught attention of President Obama. But in his follow comments, Santelli insists that it's high time our leaders listened to ALL the people in shaping America's economic future. In this exchange with Peter McCulley of Pimco, for instance, Santelli and McCulley agree on the need for citizens/government dialog, with Santelli calling it "pretty darned American."

A civic media message. (BTW, Santelli has consistently been against ALL government bailouts whether for Wall Street fat cats, automakers or distressed homebuyers. CNBC's Larry Kudlow, by contrast, strikes me as being against bailouts only for the last two.)

Santelli likely understands, as George Gilder predicted in 1988, that America's once-elite economic playing field is being levelled - flattened, democratized, changed forever - by the bottom-up digital Internet's disruption of the top-down analog media that corporate America's stranglehold on the economy for decades. Economics in the future will be as much a matter of public communication as anything else. Successful economies will be those that widely distribute the most vital information. For an open, 'digital', global-network economics to replace the closed, 'analog', old-boy network economics, central planners will include in their idea of economic resources the cultural and even spiritual resources that comprise the totality of human experience. They must also learn to follow the leadership of all members of the interconnected global household. That, more or less, is what President Obama has promised us. Can't say, though, that I see him following through yet. And as I said here (scroll down to Road to Recovery Part I), it's what John Chambers has been doing at CISCO.

The essential problem with the global economy is not so much the lack of leadership in a traditional, top-down sense of the word. It is the feeling and the fact of disconnectedness that pervades the world despite the presence of modern interactive communications technologies. We are not using these technologies effectively. If I am right on this point, it follows that the global economy will not improve until people everywhere feel and are connected. Culturally and spiritually as well as financially.

These connections must occur at local, state, national and international levels. I would stress the bottom-up, local level because the fatal flaw of yesterday's supercapitalism, demonstrated by the global financial meltdown, was its assumption that the top-down management it had imposed on the world since the end of World War II. In a digital age, this assumption becomes illusory.

Interactive media connect people. This site maintains that productive connections are essential to a viable democracy. And the responsibility of ensuring that connections are productive and not destructive lies equally with citizens and government.

Lead by following, we say here, lead by connecting, lead by co-operating. Big task, but for the first time in history we have the tools, talent and technologies to complete it. Let's get going!

(How) Can the New York Times Save Itself?

Feb 20, 2009. With a stock price now sitting at around $4.00, the Times is surely wondering. The answer: the Old Gray Lady must shed her elitism and enlarge her readership so as to expand her ad base beyond the Tiffany/Rolex set. For details, here's my comment to Paul Krugman's column in today's NYT, which cites a pessimistic Federal Reserve reading of the nation's economic prospects. A worried Krugman then asks, "What’s supposed to end this slump? No doubt this, too, shall pass — but how, and when?"

Here's a way out of the crisis, personalized at the end to help the Old Gray Lady.

February 20, 2009 9:00 am

Looking far ahead, my concern about the current recession or depression is that, once cured or endured, it will only repeat itself, and quickly, given the nanosecond speed of modern finance. It would be bad to see lenders lending and people spending like crazy again.

How can this outcome be avoided? The best way is to make citizens and government RESPONSIVE and ACCOUNTABLE to each other in the formulation and execution of economic policy. This is a task for the nation's interactive mass media, which historically have been used more for political than civic purposes.

The vast majority of Americans, when informed, are capable of understanding the political and economic forces that affect their lives. The trick is to invent lively, creative media formats - civic dialogs - that give citizens an informed voice on the issues that affect their lives.

Such programming of course will entail a sea change in the attitudes of America's governing class towards the governed. Poll after poll confirms that this attitude in recent years has been one of contempt. This change will entail dissipating the last and deepest bias in America's long march to equality: the denial of the native intelligence of human beings and, in our time, a subversion of the Jeffersonian conviction that "I know of no safe depository of the ultimate powers of society but the people themselves."

So where does all this leave the Times? It leaves it free to break the elitist shackles that keep it from teaming up with other media to reach all Americans. Intelligently.

— steve sewall, Chicago

Folks, I confess I still feel way of ahead of the curve on these matters - still a voice crying out in the wilderness - but as the world edges towards depression and as interactive media transform politics worldwide, may I say I do see events catching up real quick with the ideas I've picked up over the years from Jefferson, the Platonic Socrates, Marshall McLuhan, Henry Fielding, W. Edwards Deming, George Gilder, Shelly Palmer and, most recently, John Chambers of CISCO. And from my buddy Rich, despite his being somewhat behind the curve. And from my students at elementary, high school and college levels.

Elizabeth Kubler-Ross Redux

January 31, 2009 The "Death-and-Dying Lady" lives on. Financial correspondent Floyd Norris of the New York Times writes about a Columbia University researcher whose seven-stage theory about how industries recover from traumatic change derives from Elizabeth's five-stage theory about how terminally ill patients confront the prospect of death:

FROM SHOCK TO ACTION

Industries facing severe structural change go through a seven-step progression before they manage to deal with it, said Rita McGrath, an associate professor at Columbia Business School.

1. Shock.
2. Denial. “This can’t be happening to me.”
3. Sadness. “This is awful.”
4. Anger. “I don’t deserve this.”
5. Bargaining.
6. Acceptance.
7. Renegotiation. It is then that companies find ways to change their business model to survive.

Comments are invited to discuss where in this progression various industries are now, and what they should do. Possible industries for comment are banks, autos and newspapers.

MY COMMENT (embellished from the printed version): How shocked would former University of Chicago psychologist Elizabeth Kubler-Ross be, were she with us today, to see her five-phase model for process of grief in terminally-ill individuals plucked up from the realm of the human psyche, transported to the realm of human commerce and metamorphosed there into a seven-stage model for the recovery of cyclically-afflicted industries!

That said, the seven-step model is useful and invites comment on newspapers in particular. Most papers are hopelessly stuck in step one or two, shock and denial, and are sinking fast, unable to facilitate or even acknowledge the dominant trend of the digital age: the emergence of an increasingly articulate PUBLIC MIND of ALL citizens fueled by massive demand for interactive media experiences and, in politics, by the demand for interactive politics that led to the election of Barack Obama.

The New York Times, whose stock can now be bought for under $5 a share, remains beholden both to its traditional elite Tiffany/Rolex advertising base and to an editorial outlook that seems to want no part of the inclusiveness that marks this developing public mind. I'm no fan of Rupert Murdoch, but the Times' elitist outlook strikes me as arrogant.

In the future, profitable media (including newspapers) will find ways to mediate the disparate elements of this developing public mind, including ways of generating intelligent discourse between intellectuals and non-intellectuals. Economically speaking, they will mediate differences among of America's lower, middle and upper classes. In politics, this mediating media will make citizens and government responsive and accountable to each other in solving the nation’s problems and maximizing its opportunities.

In the last paragraph of his important Feb. 3 column, Martin Wolf of the Financial Times writes that "we are living on the cusp of history." Indeed we are, and in more ways than one. For first time in human history, human beings have the chance to use interactive media technologies to resolve a single critical problem – the collapse of the global financial system – not by military force but by human reason, as President Obama keeps telling us. In this new era, profitable media will find novel and compelling ways to tap the presently untapped Market of the Whole - in America, of all 300 million Americans - that constitutes this emerging, interactive public mind. Only when this public mind is communicating substantively with America's political leaders will America develop the informed consensus that will enable it - and the world (read Martin Wolf) - to survive the economic maelstrom in which all of us swirl today.

Storm Hits Agin!

Jan. 23, 2009. 6am. Dow futures are below 8,000 at the moment and even as the CNBC gang all but begs for an Obama honeymoon rally, I myself see the Dow heading south to test its November lows of 7,400.

This week America (and the world) celebrated the inauguration of a promising new president. But the economic news was not good, for the world was sliding into the second (economic) phase of the global economic contraction whose first (credit) phase hit with gale force last summer. This time, the dangers at home included rising unemployment, consumer spending declines and a still-weakening housing market (not to mention Citigroup, Merrill Lynch and Bank of America). And abroad, they included the Chinese contraction and confirmed recessions in many countries.

Two news items for our times: The Bank of England's historic rate cut to 1.5%, lowest since its founding in 1694. And the Moody's cut of its rating of The York Times to junk status.

LESS SHOCKING

It's worth noting that Phase II, while painful, will if nothing else be less shocking than Phase I. Thanks to the miracle of modern communications technologies, our heads are at long last out of the sand. The years of ostrich denial are done. "That we are in the midst of crisis is now well understood." That was President Obama in his inauguration speech.

Well put. And important to be said. Yet not saying much! Where do we go from here? What are we learning that will help us down the road? As time permits, I'll post links to interesting responses and solutions to the crisis. Some (Wolf, Whitney, Roubini [register], Friedman) will be variations of the $800 billion Obama stimulus plan that's now taking shape in Congress. Others (Morris, Whitney) will be strategies for cleaning up the nation's broken banking system (New York Times "Room for Debate" ). And others (Farmer, The Economist) will focus on the global crisis. Still others will argue that the best course of action is no action. There are lots of good ideas out there, often in conflict, as ideas should be.

CONSCIOUSNESS. CONSENSUS. CITIZENSHIP.

Clearly the world is far from reaching anything like consensus on a way out of the crisis. And solutions pile up so fast that even keeping up with them is a full time job for several people. What's more, the solutions being implemented are coming from the small circle of experts and central planners who for the most part failed to see the crisis coming. Ordinary citizens are voiceless when it comes to generating solutions or weighing the pros and cons of solutions advanced by experts and political leaders. Yet President Obama keeps saying that America will not able to renew itself until Americans are fully engaged in the process of renewal. Here's where civic media comes in, and we are far from having an effective one at this point.

Meanwhile, the crisis seems to worsen faster than anyone can keep up with it. It has the feel of a black hole. Or of a maelstrom, the massive deep-sea whirlpool caused by tidal shifts described by Edgar Allen Poe in his Decent to the Maelstrom, a short story about a Nordic sailor who survives one by staying cool and observing, looking for way to escape. When his brother perishes by lashing himself to the mast of the sinking ship, he escapes and survives by grasping a rising empty barrel. The story was an inspiration to Marshall McCluhan - the Canadian media prophet who first spoke of a global village - and to his biographer, W. Terrence Gordon, who chose the perfect title for his book: Escape into Understanding.

Out of the Crisis, by the way, was the magnum opus of W. Edwards Deming, the American systems engineer whose philosophy of continuous improvement based on listening to and learning from employees is widely credited with bringing Japanese industry from the ruins of World War II to global preeminence in the 1990's.

Looking for an escape. Listening to employees. Listening to citizens. Listening to ourselves and others. Deming, like McLuhan, makes great good sense to me. And I'm no engineer. Once a TV interviewer asked him what one thing he would do to improve American education. "Abolish grades!" was his immediate, blunt response. His questioner about fell off her chair. "Why?" she asked, stunned. "Because grades destroy the two qualities most necessary for productive work: co-operation and creativity." He laid down the hammer. As an educator, I couldn't agree more. These qualities, along with competence, are what the world needs now.

OUT OF THE CRISIS: FROM AN ECONOMY OF QUANTITY TO AN ECONOMY OF QUANTITY AND QUALITY?

Some economists are now speaking of reinventing the economy. Will the day come the economy is no longer seen as a matter of rising or falling GDP, of material wealth-generating productivity affecting many citizens but excluding many others? Has this ingrown, ideologically-tainted notion not utterly and recently failed us? New data-gathering technologies and the dawning Obama era make it possible for economists to generate much more comprehensive ways of measuring the current and future health of the vast networks of human survival and enrichment activities that constitute the economy.

It will soon be possible to measure the health of the economy using both traditional metrics of material quantity and new metrics of non-material quality of life. Take the concept of consumer confidence , which measures how all citizens feel about spending money. As such, it is a qualitative measurement of a quantitative aspect of the economy and, as such, as a forerunner of more comprehensive ways of assessing economic health. Behavioral economists are on this track, and for my money it leads to an economics informed by measurements of citizen satisfaction with every aspect of work and life that really matters.

OK, so all this sounds like a pipedream - like John Lennon singing "Imagine". Yet I wonder if the world hasn't reached a point where it simply can't get by - "muddle on through" as folks used to say - with anything less. The storm that's hit us is NOT an act of God or an event of nature: it's entirely man-made. Is it a life-and-death maelstrom of the kind that Poe wrote about? If so, we - the human race - will survive it only by learning from it. Not just some of us, but all of us.

Finance Models for Long and Short Term Futures

Let's get down to it (as Donnie Hathaway says at the beginning of "Everything is Everything"). Let NO ONE say we aren't looking for the best answers to the toughest questions! Though this post isn't much at the moment, it will as time permits expand to include interesting answers to these questions from all corners. Civic media, after all, is a problem-solving media. Iremove ideological barriers and partisan walls - left|center|right - by seating ALL parties at the same table - call it the table of What's Best for America.

But I myself have a bias that should be obvious to readers. I beg my readers to correct it.

I feel that some experts (Paul Krugman, Nouriel Roubini, Charles R. Morris, Steve Waldman, Mike Hudson, Paul Kasriel, Mike Whitney and Jim Willie) coming from the left wing were RIGHT and that other experts (Larry Kudlow, Larry Summers, Glenn Becker, Robert Rubin, Ben Bernanke and Hank Paulson) coming from center or center-right were WRONG in their assessments of the health of Amercan and global economies in recent years. And when it comes to resolving the crisis, it seems that the guys who were wrong are closer to Barack Obama at the moment than the guys who correctly predicted the global meltdown two, three or even four years ago.

So this post and this site needs input from center and right ring orientations. Specifically, who from these orientations saw the credit crisis coming?

OK, here we go. The crisis is being resolved in two phases, short and long term. We are now in the midst of a short term triage to stabilize the economy. This will lead to some kind of long term cure to restore American and global economies to maximum health.

But there's a danger: that of stabilizing the economy today in ways that ensure future repetitions of the credit crisis. Perhaps there's no alternative to such crises: perhaps financial bubbles are inherent to the so-called virtuous and vicious phases of the business cycle, as economist Hyman Minsky argued. And perhaps none exists on the spectrum of economic options that runs from total communistic/socialistic state command economies on the far left to pure unregulated free-market consumer capitalism on the far right.

Is it necessary, then, or even possible, for professional economists and central planners to think outside the box of this spectrum? It certainly won't be easy, for this spectrum seems to have contained all economic thought since the days of David Ricardo, Adam Smith, Karl Marx, Friedrich Hayek, Joseph Schumpeter, John Maynard Keynes, Milton Friedman and of course Hyman Minsky.

SHORT TERM Getting out of the mess we're in now (weathering the storm). Stabilizing American and global economies and financial systems within the next 12 to 24 months. Getting existing credit systems to work (assuming they can work) even as Paulson, Bernanke and central bankers worldwide take extreme and untested steps to do so.

• A Path to Economic Recovery Column by Charles R Morris
• What Should Be Done? Link to a 30 min. audio presentation by James K. Galbraith
• Bernanke's plan to clean up banks
  
• Martin Wolf critiques the Obama Recovery Plan (1/14)
  

LONG TERM Designing sustainable economic futures for the United States and the world of which it is now an integral part (mastering the weather). Some of the more astute predicters of the global credit bubble argue that modern consumer capitalism is cracked beyond repair, and that something new must be invented. It means developing the production, trade, currency and governance mechanisms adequate to ensuring the functionality of these new systems.

• Economist Dean Baker proposes a tax on financial transactions (Bob Herbert op ed)
  

Reader, Be Not Discouraged . . .

to find the post you read yesterday revised today. I am compulsive reviser, I admit it. I can revise a 900-word piece 40 or 50 times. It's like polishing a rock. Discretely, you ask if there might be more productive ways for a civic media advocate to spend his time. Point taken. But sometimes I hold the rock up to the sunlight and see it shining and out of nowhere up pops this feeling that the polishing was all worthwhile. And besides, it's fun. Most of the time.

So Why Doesn't the U.S. Have a Civic Media?

Yeah, why not? Well my buddy Rich insists the U.S. already has a civic media. He's a deep Democrat. He says citizens used civic sites like Daily Kos, Huff Post and Moveon.org to elect Barack Obama. And Republicans used similar sites to support John McCain.

But these sites, I say, are partisan. Civic sites are non-partisan. And where Rich's sites are more about individuals then issues, civic sites focus more on the ISSUES. They get Democrats and Republicans talking with each other for the common good, much as Barack Obama says America must do in order to weather the economic storm we're in. And believe me, they can do this in hundreds of entertaining and instructive ways.

Then I bring out my big guns. I remind Rich that his sites advance the interests of a money-driven two-party system that's degraded American politics since the advent of televised political advertising in the 1960's. This system, I say, has made politics the perquisite of the rich. It's forced political incumbents to spend up to a third of their taxpayer-paid work week raising billions of dollars for the mind-numbing attack ads that keep them in office. It's kept all but a tiny number of America's best and brightest from even considering a career in politics. And it's done all this dirty work systematically, in every city and state, from coast to coast.

It's frustrating. Think about it: the great democracy that gave the world the miracle of modern electronic communications AND the Jeffersonian idea that men can be trusted to govern themselves has given itself a political communications system that most of its founding fathers, could they see it today, would condemn as subversive of democracy.

More frustrating still is that no politician, party, pundit, public interest group or university professor has, to my knowledge, ever called for a modern interactive political communications system, even though all of the technologies needed to implement one have been in place for years. Politicians and public interest groups have instead spun their wheels on campaign finance reform - a red herring of an issue if ever there was one. (Wait - Noam Chomsky endorsed civic media in 1994, telling an audience of 500 in Chicago that civic media offers "some hope for the future, in fact the only hope for the future.")

Why such silence on what is after all the most obvious solution to a political media that suppresses or minimizes citizen input? Truth be told, many and possibly most Americans today are by no means confident that men and women can be trusted to govern themselves. Asked about the prospects for a civic media in 1994, Noam Chomsky said there's no way the powers that be would ever let it happen. But Obama's election last year suggests that there's no way the powers that be can STOP a civic media from happening. (Chomsky himself sounds somewhat more optimistic today.) Still, Americans today harbor all kinds of mistrust for each other. For trust to develop, it will take time for an inclusive political media to undo 30 years of damage caused by media polarization of the American people into sometimes paranoid extremes of red and blue, and of rich and poor. (In 2004, I traced the roots of this polarization back to, of all places, Yale University, where I received my teaching degree and where my father, Richard B. Sewall, taught English for 44 years).

Ironically, America's political media have minimized citizen input despite universal user demand for interactive media experiences. Now you'd think the minds of our media moguls would light up at the thought of an untapped "market of the whole" of 300 million Americans. But no. Not yet. Not even when hardpressed network TV execs, losing market share to the Internet and cable TV, are desperate for what CBS's Leslie Moonves calls a "transformative hit".

Sure, Survivor-producer Mark Burnett and Rupert Murdoch’s News Corp were reported in 2007 to be working on Independent, a politically-themed Reality TV show targeting young adults that was to debut in 2008 on YouTube. So the minds of the moguls were slowly switching on, if dimly. But this and this and this is what comes up when I enter "Independent" at YouTube today.

In the 2006 midterm congressional elections, exit polls confirmed voter disgust with political corruption. Soon after, my buddy Rich (my civic media sparring partner since the early 1990's) suggested that the format of voter-driven reality TV might have civic media potential. At first I thought he'd lost it, but this time he was dead right, and I will always be grateful. Within a few months, I had developed America's Choice, a nifty and comprehensive treatment for politically-themed reality TV that enables all Americans to participate INTELLIGENTLY in the great voter-driven game of democracy.

In 2007, I presented America's Choice to half a dozen network TV executives, including a genuine media mogul. No luck. Zero interest.

Why not? One exec said he'd seen similar treatments. Another said that politically-themed reality TV would make the networks look partisan in the public eye. Then there were the unspoken reasons: the fear of rocking the boat of the existing political system and of course the billions of dollars the networks rake in from political ads come election time.

America's TV networks, it seemed, were either blind or indifferent to the mounting instability of the very political system their attack ads were propping up.

Light years ago, in 1988, George Gilder had called network TV a "totalitarian" medium that "squeezes the consciousness of an entire nation through a few score channels." He did so in a wonderful little book entitled Life After Television: the Coming Transformation of Media and American Life. Here Gilder predicted the overthrow of the "alien and corrosive force" of America's top-down, analog TV networks by the grassroots political networks created by the emerging, citizen-empowering medium of the digital "teleputer" (his quaint 1988 term for the PC).

Today, twenty years later, we see not the overthrow of analog TV but the astonishing blink-of-an-eye convergence and integration of all media, print and electronic. The emerging meta-network of interactive networks bids well to dissolve the mindless red/blue polarization of American politics and replacing it with intelligent, problem-solving discourse that puts all Americans, rich and poor, red stat and blue state, on a more even footing with themselves and their elected leaders.

So my buddy Rich is right after all. Well partly . . .

In 2008, America elected a new president whose displeasure with a politics that ignores citizens comes from the same place as the displeasure voiced here. So was the old top-down system actually serving the public interest after all? It must be said that Obama had raised and spent a ton of money on televised ads, with about half of his donations being over $1,000.

Something old, it seemed, was evolving, gradually, into something new.

But this gradual evolution was violently disrupted in 2008 by the volcanic eruption of a financial crisis the likes of which America hadn't seen since the Great Depression. (Yet the crisis, and Obama's statesmanlike response it, likely turned the tide for him.)

As we begin the new year, efforts to recover from the crisis are being managed with little public input or oversight by the same financial community that created it. Americans are angry, and with reason. The old system, embodied in the somewhat credible idea of an Ivy League financial elite, seems to be reasserting itself. Billions of taxpayer dollars seem to be going mainly to failed banks. Americans of sharply differing political views are saying that the only way to prevent this crisis from worsening or recurring is for the American people, as a people, to have a voice in the creation of a new financial system.

That of course is saying an awful lot. But the idea is worth exploring. In coming posts, liberals, conservatives and libertarians are invited to talk about what this system might look like, how it might take shape and what kind of input citizens might have in its creation. (More robust sites than this will be created to advance the discussion as it grows.)

So looking ahead (looking forward if you follow Larry Kudlow), the question isn't WHY America lacks a civic media but WHEN it will get one. Let the press put this question to President Obama in the context of his stirring election-day reaffirmation of the American spirit:

America . . . This is our time - to put our people back to work and open doors of opportunity for our kids; to restore prosperity and promote the cause of peace; to reclaim the American Dream and reaffirm that fundamental truth - that out of many, we are one; that while we breathe, we hope, and where we are met with cynicism, and doubt, and those who tell us that we can't, we will respond with that timeless creed that sums up the spirit of a people: Yes We Can.

And let Americans put this question - this challenge - to their elected leaders and to the nation's public and commercial media as well in order to secure their commitment to giving free and full expression to this American spirit. And to the same end, let yourself, dear reader, feel free (or duty bound) to affirm, correct or refute the ideas advanced here.