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I Want To Be Too Big To Fail

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News comes today of a proposed government rescue of Fannie Mae and Freddie Mac, the nation's largest finance companies. Investors are deserting the companies as they have become increasingly alarmed that the companies do not have enough capital to cover losses brought on by the reeling housing market. Treasury Secretary Henry Paulson Jr. announced the proposed bailout on Sunday, explaining that a failure of the two companies would deal a staggering blow to the U.S. economy.

This is the second time in four months that the government has stepped in to rescue a major financial institution. In March, the Treasury Department helped arrange the sale of investment bank Bear Stearns, saying at the time that the economy was too fragile for such a large financial institution to fail.

Based on this sample, I've discovered the secret to having this administration care about your financial well-being:

1. Mismanage your finances, especially by overextending yourself by investing in dubious investments;
2. Be too big to fail.

Luckily, many of us have already begun to take these principles to heart. Americans are notoriously poor savers, and household debt now stands at historic highs (equal to over 130% of disposable income, according to the Economic Policy Institute).

So under the first condition for government assistance, we're all doing poorly, that is, well. We are piling up debt by putting our money in poor investment instruments.

Personally, I have piled up debt investing in things such as vacations for my family, gasoline for my SUV, and a flat-screen television. There is absolutely no chance that any of these investments will pay off. Fannie Mae has nothing on me.

The second condition is more problematic. I have not amassed enough debt that anyone outside my own family would care. If my "investment" by way of VISA in a new Wii for the living room doesn't pay off, I will have no one to rescue me.

My problem is that I have been too small-minded. I shouldn't buy one Wii. I should by 10. I should invest in a larger SUV, or maybe a large power boat -- I hear they're real gas guzzlers. I should seek out opportunities to pay full retail. I should answer every one of those credit card mailings I get.

That way, other people will slowly become invested in my continued financial mismanagement. If I amass enough debt, my failure to pay bills would undermine the stability of the whole economy. My problem so far is that I haven't failed enough.

But this insight works even better if others jump on board the poor investment bandwagon. Even if your name isn't Fannie, you too can mismanage your finances on a gigantic scale.

This is an effort that would benefit from collective action. Just imagine if we all pooled our efforts and failed together, and spectacularly. Only through grand failure can we succeed.

Meet you at the Hummer dealer. Bring your credit card. In fact, bring two.