Planet Ponzi – the massive build-up of debt, the total loss of political transparency – had caused multiple casualties across the world. The failure of banks, the huge rise in government debt, the failure of business, the loss of jobs, the pressure on real incomes – all these things stem from the same dark causes.

But there’s one consequence greater than any of these things. In the last few weeks, democracy has taken a pasting. For all Berlusconi’s faults (and there are many), he was the democratically elected leader of his country. The new Italian government does not boast a single elected politician. The Italian people have had nothing to do with choosing the direction of their country. Given that their nation has faced no more serious issues since the Second World War, this is a somber thought indeed.

It’s the same thing in Greece. George Papandreou may not have been a perfect leader, but he was the country’s elected leader. When Europe presented Greece with an ultimatum, Papandreou’s first instinct was to take that offer to his country. The future of the Greek people would be defined over the next ten years or more by these matters: Papandreou was right to consult his nation. As soon as the ‘international community’ got wind of those plans, he was promptly rebuked, he left office – and a new government took power without an election.

In the United States: the same thing. The budgetary ‘super-committee’ was set up in the wake of the debt-ceiling vote to define a budget strategy for the US government. That is: party apparatchiks chose – without election or public consultation – the men and women who will plan the nation’s fiscal future. Again: a total absence of democracy, a total lack of transparency.

And what happens? What emerges from this process? Answer: failure. The politicians in America, as in every country, are chosen in order to debate and solve the leading issues of the day. They need to solve those issues through open debate and place themselves in front of the electorate sufficiently often that the electorate can express a view.

In America, our political process has shown itself, so far, incapable of this basic task. To speak bluntly but fairly: American democracy is, at the present time, failing the nation.

Even in the countries, like Germany, that are not a part of Planet Ponzi, democracy seems close to collapse. Why should the German people be asked to bail out their southern neighbours and not get a vote on it? Why should the ECB pile into buying Italian bonds – probably illegally – and yet the people of Europe have no say on these things? Why should the British government refuse a Euro referendum, simply on the grounds that the leaders might not like the answer?

The solutions to Planet Ponzi are simple. More democracy not less. Less debt, not more. At the moment, we have things – tragically – the wrong way round.

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Ah, don’t you just love traditions? Hollowing out a pumpkin for halloween. Sitting down to turkey for Thanksgiving. Seeing family and friends around the winter holiday season. And Goldman’s the same. It’s a traditional sort. Once it’s got into a habit – excessive leverage, taking huge risks and disguising them, helping to bankrupt Western capitalism, [...]