As the forces of recession stoke up, traditional signs and indicators are crowding the masts like warning flags at a shark-infested beach. As usually happens at this stage in the economic cycle, the proud façade of some of the great, stone-faced banks are vibrating and showering passers-by with debris from the upper stories.

Societe Generale, France’s second bank, suddenly announced that it had been defrauded of $7.2 billion. Canadian Imperial Bank of Commerce, which has been intermittently beleaguered for many years, became a catchment for the questionable real-estate-backed loans of Goldman Sachs. Once again, the retained earnings of many of the U.S. lending and merchant banks are suffering sudden sharp reductions. We may expect the Fed to arrange hasty banking marriages with fallen brides, as happened in previous downturns when Manufacturers Hanover, Chemical, Continental Illinois National, and other big U.S. banks vanished into the arms of more successful competitors. Lending and merchant banks will finally come together, but if other countries are any guide, the leaden lack of imagination of lenders will crush the enterprising spirit of the deal-makers, but not their avarice or uneven judgment of risk.

The wealthiest people in the Western World bestride the earth in work or nerd-clothes (no proverbial “suits” they), speaking like Ralph Nader sound-alikes. Bill Gates, America’s wealthiest man, whom Rupert Murdoch, in one of his more felicitous apercus, described as the sort of person who, “if you were drowning, would put a garden hose down your throat,” has just inflicted himself on Davos, the World’s Fair of self-important conferences, and told everyone to convert to “creative capitalism,” i.e. businesses run for the benefit of the poor. This is pious claptrap; Bill Gates knows better than anyone that capitalism encourages productivity, economic growth, and employment, and that helping the disadvantaged has to be incentivized through the tax system, making businesses designed for less than maximum profit financially worthwhile.

He is preaching to the wrong choir. As he drives in corduroy trousers and a viyella shirt in his SUV to the Burger King, Bill Gates can still not answer NYU economist William Easterly’s assertion to him at an earlier conference that the $2.3 trillion in foreign aid to Africa in the last fifty years hasn’t achieved much. The spectacle of Bill Gates masquerading as a nerd chiefly concerned with fighting AIDS in Africa, and of friendly Uncle Warren Buffett, generally reckoned to be America’s second wealthiest man, demanding that his taxes be raised, is low farce.

No one is stopping Warren Buffett from writing all the checks he wants to good causes, where his billions would be more efficiently employed than in taxes and lubrication of the U.S. bureaucracy. As Steve Forbes remarked in the Wall Street Journal on Thursday, the United States Constitution and its Amendments is 8,000 words; the U.S. Tax Code is nine million words, so more than a thousand times more verbosity is required to try to pay for the government than to define its powers and structures. It is hard to imagine what has possessed the Sage of Omaha, apart from precautionary public relations, but we will know the recession is deep if he goes back to his brush cut.

The serious indicators are worrisome. Predictions are now that the world rate of GDP growth will decline from 4% in 2006 to 3.8% in 2007, to close to 3% this year, a two-year decline in absolute numbers of almost a half-trillion dollars, enough to ricochet all over the world. The United States is about to record two consecutive quarters of negative economic growth, the official criterion of a recession. U.S. unemployment has risen to 5% from 4.7%, not a high number in itself, but one that always presages a downturn.

I never saw a tax reduction I didn’t like, nor one that wasn’t good for the economy. But the U.S. bipartisan economic stimulus package is a band-aid. The best plan of the presidential candidates was Rudolph Giuliani’s, but he is riding into the Manhattan Sunset, endlessly reenacting 9/11 like a nativity scene.

No one has the remotest idea what is really happening in the hedge fund industry, where Alan Greenspan told the Congress a few years ago he was relying on the banking system to be prudent lenders. The former Fed chairman was not trying to be humorous. Leaving the monitoring of the hedge funds to the lenders was like putting the town drunk in charge of the Temperance Society.

The core problem is that the U.S. has become a world-class chump. It is a dumping-ground for Chinese and Indian manufacturers, and is importing 60% of its oil, creating an $800 billion annual current account deficit, which unfriendly or unstable countries are using to finance terrorism and to buy up chunks of the U.S. economy. Apart from the aberrant and unfeasible Jimmy Carter, no president from Franklin Delano Roosevelt to Reagan would have tolerated these open arteries. The next president will have to do better. That will be the change that matters.

Lord Black is the author of “Franklin Delano Roosevelt: Champion of Freedom” and “Richard M. Nixon: A Life in Full.”