BOSTON

HUMILITY is a virtue King David wasn’t the last to lose sight of when he was tempted to think greatness as king, psalmist and slayer of Goliath entitled him to covet Bathsheba, a married woman.

This David knows the 35-year history of Ward 19 in Boston as well as anyone. I know who put out scurrilous fliers about whom, and the sometimes hilarious speculation by the subjects about who had done it. But humility deserts the Sage of Dirty Tricks in Ward 19 if he tries to comment about the global economy –– which is what I am about to do.

Well, since economists and politicians have been clueless in their analysis, dissembling in their assurances and Wrong Way Corrigans in the direction they were leading us, as one who knows of petty hubris and how to figure out what went on in meetings the public was locked out of, may have something to add.

Total secrecy on the evening of Sept. 17, when Treasury Secretary Henry Paulson briefed members of Congress on the global financial crisis, tells us what Mr. Paulson said: In the wake of recent shocks, the financial system, which for 38 years was based on faith in the United States and its dollar, had no faith. Common lines of credit, which are the 10W-30 of the economic engine, were dry, and the global economy was about to seize.

Mr. Paulson put the fear of God, or perhaps of Stalin, in the politicians he was addressing –– hoping they would not dither in declaring him Baibakov. (Nikolai Baibakov was Stalin’s oil commissar and economic adviser. In July 1942, Stalin held up two fingers and told Baibakov he would shoot him twice: Once if he failed to keep the Germans from seizing the Baku oil fields, and a second time if, having repelled the enemy, he did not have the oil fields producing immediately! In terror, and with dictatorial powers, Baibakov did well, and died in bed in April 2008, at 97.)

All businesses need access to liquidity to survive, and the dollar-drouth is a matter of record. Whether or not Mr. Paulson openly stipulated that the global economy was about to collapse, that’s what he meant, and it reveals the essential aspect of the crisis at hand.

The problem is that what New York Times columnist Tom Friedman calls “the flat earth” –– a world economy so beautifully interconnected that opportunity is everywhere –– is utterly vulnerable to miscalculation. If a company in Rhode Island can create opportunity in Bangladesh, corruption and hubris on a grand scale at Freddie Mac and Fannie Mae can create unemployment in Rhode Island and starvation in Bangladesh. In removing ceilings, floors and walls impeding trade, we have, it is now apparent, removed all “fire separation” worldwide.

The current crisis is thus not merely one capable of producing a brutal recession –– something we could survive. The greater significance is this: The Bretton Woods Conference of July 1-22, 1944, simply put, established postwar international financial arrangements entailing open markets and monetary stability based on the convertibility of currencies –– mainly in practice, the U.S. dollar –– to gold.

On Aug. 15, 1971, President Nixon and Treasury Secretary John Connally abruptly ended the Bretton Woods system. Without consulting other nations, or even the State Department, they “closed the gold window,” meaning that the dollar’s relationship to gold would henceforth float on the open market, rather than being guaranteed at a fixed rate. Without gold, or at least its aura, backing the dollar, faith in the dollar was what sustained a stable world economy. “The thrill is gone” is what, in effect, Secretary Paulson told his stunned interlocutors. “Make me Baibakov or face doom!”

Mr. Paulson was revealing that the current crisis is epochal: The so-called “Nixon shock” of 1971 has reached its logical choke point of no confidence, and the need for rebuilding “fire separation” in some modified form of the Bretton Woods system is imperative. That is the significance behind the popping corn of day-to-day of headlines.

The global economy can be traced to Marco Polo, and was well under way in 1441, when Prince Henry the Navigator first brought African slaves to Portugal. It was in full build-out when Francisco Pizarro subdued the Inca in the 1530s, leading to the latter being entombed in gold and silver mines.

The South Sea Bubble of 1720 –– a debt-for-equity scheme in which the British government and members of the House of Lords speculated in the slave trade — had, when it burst, many features in common with Fannie, Freddie and our own burst housing bubble. “Polite ladies’ maids who had bought their own carriages became destitute almost overnight. Clergy, bishops and the gentry lost their life savings; the whole country suffered catastrophic loss of money and property,” according to Historic-UK.com.

Globalization has been around a while and isn’t going to be brought down by Hollywood’s 2008 take on a violent 1999 anti-globalization riot in Seattle. The question is to manage it in a way that liberates innovation but doesn’t leave the whole world vulnerable to a handful of dirty tricksters for whom the virtue of humility is contemptible.

David A. Mittell Jr. is a member of The Journal’s editorial board.