Two developments this past weekend put in sharp focus the critical state of the American economy.

The first was the announcement on Friday that the economy in August lost 84,000 jobs, as opposed to gaining the estimated 150,000 new jobs needed each month to absorb new entrants into the labor market, The Labor Department also adjusted the figures for July and June downward to show an additional loss of 58,000 jobs, bringing the year's total loss to 605,000. Sectors hit hard include manufacturing and housing-related industries. Consumers aren't buying much, despite the $107 billion in borrowed money that was sent out in federal rebate checks, which were spent for the most part to meet rising gas and food costs.

The price at the pump is dropping now, but not proportionate to the drop in world oil prices. Let us not forget how fast the price at the pump went up as the world price rose. The oil companies clearly think that the American motorist is now used to the higher prices, and sees no reason to pass along its reduced costs to the consumer, as opposed to pushing up their own profits. They probably count on the American people to forget what the price once was.

The other sharp blow administered to the ordinary American this weekend was the announcement by Treasury Secretary Henry M. Paulson Jr. that the federal government, contrary to what he had pledged in July, was now taking over the two government/private mortgage banks, Fannie Mae and Freddie Mac. This made the American taxpayer responsible for some $5.3 trillion in mortgage loans that Fannie and Freddie hold or guarantee.

This $5.3 trillion will not necessarily be added to the U.S. national debt, which now stands at about $10 trillion. But the American taxpayer ultimately may have to pick up $100 billion each to keep Fannie and Freddie afloat. And, by the way, that money would have to be borrowed.

The main reason for bailing out these two institutions is that otherwise, foreign lenders, led by the Bank of China, who currently keep the federal government running by buying its bonds, might stop doing so, based on their fully justified concerns about the long-term solvency of the United States.

Now let's try some kitchen-table-level analysis:

Husband comes home with a new, used SUV. Wife asks what possessed him to buy it. He says they need it. She asks him why, given that they have three vehicles already, particularly after he has revealed that it is a gas-guzzler with 125,000 miles on it that has needed a lot of repairs, most recently a major overhaul that didn't work. He says he borrowed the money to buy the SUV because otherwise the neighbors might think that he couldn't afford it and might refuse to loan him the money he was going to ask them for to meet the mortgage payments on the house and the payments on the other three vehicles.

The job losses and the bailout of Fannie and Freddie were not the acts of a malevolent god any more than the Great Depression of the 1930s and the efforts of President Franklin D. Roosevelt to end it were. The administrations of Presidents Warren G. Harding, Calvin Coolidge and Herbert Hoover had run the American economy into the ditch. Mr. Roosevelt took actions that helped Americans dig themselves out of the hole.

This economic revival had little or nothing to do with political party, with the fact that America had sunk into depression under three Republican presidents and came back to life under a Democratic one. What really did it, according to me, was the simple fact of change at the top.

People resist significant change. Look at the situation now. We have always elected white men as president. This time, even though the white male candidate is rich, old and tired, some polls say we may put him in charge.

In Pittsburgh we have voted slate after slate of Democratic candidates into office since the 1930s as the city descended from the preeminent, wealthy position it occupied in the country then to the sad position of the fifth poorest of America's larger cities now. It is truly remarkable that the clear evidence that this city's leadership has for the past 70 years not been able to reverse our slide has not led to a change in political leadership. That is not to say that the Republican candidates put forward have suggested much spark of inspiration. But continuing to take the same action in the hope that the next time it will have a different outcome is comparable to the theory that chickens peck the ground because they believe this is what causes the yard to be scattered with feed.

The incumbent administration's approach to the economy has been based on the thesis that making the rich richer by cutting their taxes and letting them run free of regulation would prompt them to take actions that would improve the situation of the general population. They have instead simply bought themselves more houses in nicer places and too bad for the rest of us.

Remarkable. Scary.