Or at least try and get the good deals he gets.

This is a neat structure for investors and representatives of taxpayers eager to protect against possible losses. It's much less risky than buying common stock, the owners of which receive no dividends until Buffett's are paid in full and who are first in line to take losses. And the warrants also amplify any upside as and when share prices rise.

There's a good argument that recapitalizing banks this way, rather than buying dodgy assets at all, would be the most efficient use of taxpayers' money. But the TARP as it stands involves both elements. The advantage of taking investments through preferred stock and warrants as well as buying assets is that it makes the asset pricing question slightly less critical.

Why? If the Treasury fund buys mortgages and other distressed securities at prices that are painfully low for banks, at least the banks can expect a capital infusion to help cover losses. And if the fund's managers are too generous, they stand to collect at least some of the difference by sharing in banks' stock price gains.

Buffett also appears to have scored bargains. Aside from collecting 10 percent dividends on his preferred stock investments in both Goldman and GE, his warrants to buy their shares are worth, according to standard option pricing models, billions extra.

The idea is catching on. In return for backstopping certain losses on Citigroup's purchase of Wachovia's banking operations, the FDIC collected $12 billion in Citigroup preferred stock and warrants.

Buffett said during his CNBC appearance that the House of Representatives should pass the TARP this time around-he called the state of financial markets "a national emergency." Assuming that happens,  Paulson will have to work out how to put the legislation into practice. The lessons from Goldman, GE, and Citigroup may help in part. And while he may not be able to have Buffett, it could well make sense to try to think like him.