Identifying A Crisis: Not The Same As Knowing Why It Exists

Today's failure of the bailout legislation represents the failure of Congress and the Bush administration to ask a fundamental question: "Why do we have this crisis?"

They thought they had asked and answered that question, in identifying the fact that these mortgage-based investment instruments are crashing our economic system.

However, that bit of knowledge is only the answer to the question "What is happening to cause this crisis?"

It is not an answer to the question "Why is this crisis happening?"

No one in Washington is really asking the Why Question.

Here's what our leaders in Washington need to know to answer the Why Question. When a system crashes, that happens because there's something about The Design Of The Larger System That Created It that causes it to crash.

This is the principle at the core of Systems Thinking.

When I heard Paulson and Bush talking about taking a systemic approach to solving the crisis, I knew they didn't know what they were talking about. That's because they were only offering a solution to the answer to the question What Happened?. They were not offering a solution to the answer you get from asking the Why Did It Happen? question.

So, here's my question for you all. What is it about the design of the larger system - the design of our sociopolitical economic system within which our global economic system exists - that has caused our existing economic system to crash? And what do you think can be done to make our system work better?

I look forward to hearing what you think are the answers to these questions.

As Mike Myers used to say (in the guise of Linda Richman) "Can an economic system that has crashed be redesigned so it works for everyone? Discuss.."