ARROYO GRANDE, Calif. (MarketWatch) -- Warning: Behavioral economics means one thing to Wall Street and Washington and something quite different to Main Street. It depends on whether you're the nudger or nudgee, the manipulator or the manipulated, the guys making lots of money or the folks being scammed.

Average folks erroneously believe behavioral economics helps them. But behavioral nudgers just want to help themselves.

And both political parties are guilty. Behavioral economics is all the rage since the new president hired some academic behaviorists. That also helped the GOP, made average folks forget the former president had his nudgers, too, like former Treasury Secretary Henry Paulson. Moreover, his party recently hired 350 lobbyists, many former Senators and Congressmen, to kill the new guy's health-care reform.

The truth is, folks, behavioral economics, nudging, manipulation and lobbying, whatever you call it, has been a part of American politics for a long time under many names, though neither party publicly admits their nudging strategies.

Puzzled? Ask yourself: Why is the GOP so aggressively demonizing Obama's health-care reform as "socialism?" Why? Yes, something smells fishy, especially since the GOP created the biggest "socialized medicine" program ever with Medicare drugs.

Then suddenly the "why" hit me. Here's why ... All the fear-mongering about health-care "socialism" is actually a strategic smoke screen, a brilliant counterattack, a sneaky political cover-up of the GOP's recent historic takeover of America using taxpayer-funded bailout money against us. Get it? The Right's making Left turns into "socialism."

You heard me. In "Bailout Nation," hedge fund manager Barry Ritholtz summarizes this clandestine takeover of the great American democracy, led by Paulson and the Goldman Conspiracy juggernaut. In less than a year America has become "Socialism for the Rich! Capitalism for the Rest," says Ritholtz.

It all began last October, just before the elections. Paulson, Goldman's Trojan Horse inside a GOP-controlled White House, moved with the lightning speed of a special-ops team attacking behind enemy lines. Paulson took command of the meltdown, before our clueless Congress knew what happened.

Back then, the Goldman Conspiracy was near bankruptcy as the stock bubble crashed. But Naomi Klein, author of "The Shock Doctrine: Rise of Disaster Capitalism," warned: "When those bubbles burst" Wall Street's "ideology becomes a hindrance and goes dormant while big government rides to the rescue." Klein then predicted: Free-market "ideology will come roaring back when the bailouts are done. The massive debts the public is accumulating to bail out the speculators will then become part of a global budget crisis."

Rolling Stone's Matt Taibbi also warned of an attack brewing in "The Big Takeover, how Wall Street insiders are using the bailout to stage a revolution."

Yes, that "revolution" took less than a year. Except we did not return to the old Reganomics capitalism Klein warned of. Instead, the Goldman Conspiracy created a new American "Socialist-Capitalism." As Ritholtz aptly describes it, America now has "socialization of risk" [with trillions of toxic bailout debt dumped on taxpayers] versus "privatization of profits" [for Wall Street insiders like the Goldman Conspiracy].

Democracy is dead in Wall Street's new 'Socialism for The Rich'

This is a historic government coup: The GOP created a new "American Socialism" that resembles Russia under Putin, with its bizarre blend of socialism plus just enough hint of capitalism to keep a steady flow of kickbacks to a corrupt dictator and his moneyed cronies.

At high levels the game reminds me of Bush looking deep into the Putin's eyes and getting "a sense of his soul" (the "soul" of a former KGB agent and communist enemy of America?) Just as Bush failed to see the true "soul" of Russia's boss, Congress and today's Main Street America cannot see the hidden "soul" of the new "American Socialism" being created by the Goldman Conspiracy, banks and their political pawns.

We've written often about the many sides of this takeover. We've also reviewed endless critiques in Harper's, Rolling Stone, New Yorker and others. Here are eight principles for a new "Socialist Manifesto" emerging out of our dying democracy, a profile of the new "American Socialism" that will rule your life ... till it self-destructs our way of life:

1. Always elect a figurehead president

Putin skirted term limits by getting Medvedev elected president. Then Putin was appointed party leader and prime minister, the real power behind the throne. That's one way power stays in power playing the game. Wall Street is a master at playing this game, as the single largest money donor to political campaigns. Donations assure continued control behind an illusion of democracy, where all politicians are mere pawns.

2. Greed is great in the new 'Socialist-Capitalism'

In his blog, Matt Taibbi asks "what's wrong" with Goldman's $3.44 billion second-quarter profits on top of setting aside $11.4 billion for insiders? "What's wrong is that this is not free-market earnings but an almost pure state subsidy" as Congress steals our tax dollars giving them "to the same guys who had just blown up the financial world."

3. Too-stupid-to-fail big banks will always get bailed out

In the New Yorker Joe Haggen described their arrogant culture: "The god is Goldman. You subjugate yourself to that god, and in return we will make you a gazillionaire." But as recently as last fall "not a single Wall Street executive" Haggen interviewed "believed Goldman would have survived an overall collapse of the financial system. A large loss would have been inevitable as lending evaporated, and Goldman Sachs would have struggled to shrink the company to a fraction of its size overnight."

Taibbi adds: "AIG owed Goldman about $20 billion at the time it went into a death spiral." Thanks to Paulson's $13 billion gift, tax dollars went through AIG straight into Goldman's pockets.

4. Pretend to be a commercial bank, risk like an investment bank

Wall Street still gambles as investment banks. Worse: Taibbi says when Goldman converted they became "eligible for a new program that gives commercial banks FDIC backing for unsecured debt ... a free AAA rating to the big banks and allows them access to mountains of cheap money." No wonder "Goldman took full advantage of this deal, issuing $28 billion in FDIC-backed debt after its conversion. Exactly how hard is it for a bank to make a profit when it has unlimited access to virtually free money?"

5. American taxpayers are Wall Street's personal piggy bank

Taibbi notes that Goldman got $10 billion TARP money, claims they're now paid off. But the Treasury still has warrants which Goldman wants to renegotiate below market prices, and the juicy low-interest loans help them increase their profit margin.

6. High-risk leveraging guarantees high-paid insider bonuses

After converting into a commercial bank Reuter's reported that Wall Street was "taking steps to reduce leverage." But since then "Goldman has been emboldened by all its state backing to borrow more and gamble more than ever," says Taibbi. "This is the equivalent of a regular casino gambler who hears that the house has doubled down on his credit line and decides to stay up at the tables all night, instead of going home and sobering up."

Meanwhile, "Goldman's VaR, or Value at Risk, which measures the amount of money the bank puts at risk on any given day" has "soared since last year."

7. Government-approved CIA-style silence hides 'The Game'

The TARP Inspector General estimates total new debt for all bailout programs will be a staggering $23.7 trillion. But the Fed Chairman refuses to disclose vital information, even to Congress. Bernanke learned that trick from the CIA, so they can't be audited.

Taibbi warns that taxpayers are stuck with piles of Wall Street's "worthless crap assets they acquired while they were playing roulette the past 10 years or so. We just have no idea how much crap they unloaded on the Fed, or how much they borrowed."

8. New laws secure perpetual power for new 'Socialist Conspiracy'

Wall Street, under the command of the Goldman Conspiracy, can further consolidate power over the American people forever by making sure Congress and the President (no matter which party wins elections) passes other new laws:

Kill the proposed Consumer Financial Protection Agency. Kill "public option" competition in the health-care reform. Kill all efforts to revive Glass-Steagall. Pass a "cap and trade" law so Wall Street can start gambling trillions in a new derivatives bubble. Pass laws to guarantee Wall Street's "too-stupid-to-fail" big banks unlimited access to taxpayer funds in the future, as they've enjoyed since October.

Final comment: More demands will naturally follow to empower this banana republic dictatorship disguised as the new "American Socialism."