If something is too big to fail, shouldn’t it be completely part of the government rather than lie in some netherworld between the public and private sectors? That’s the only question worth asking in light of the Fed’s proposed bailout of our two big mortgage giants, Fannie Mae and Freddie Mac.

What also seems odd is the constant reassurance from figures of authority that nothing is really wrong, that Fannie and Freddie don’t really need any money from the Fed. Then why all the fuss and bother?

At some point, someone in power (and their enablers) will have to start reading from a reality-based playbook. How else do you explain the large number of people who believe the country is on the wrong track and the large number of pundits and commentators who insist everything deep down is really OK?

Maybe Phil Gramm was right. Or maybe, just maybe, if you start to think about it, just for a fraction of a second, as crazy as it may sound and despite all of Gramm’s degrees and years in public life, he has no idea what he’s talking about. He just wants questions about the economy to go away.

Now that sounds like a reality-based playbook for a presidential campaign in 2008.