Oliver Goodenough, a law professor at Vermont Law School, talks about a standard game economics professors use to "demonstrate how apparently rational decisions can create a disastrous result." The game is called "The Dollar Auction". I won't go into its details, since the Wikipedia link has a nice, succinct explanation.
Goodenough uses the Dollar Auction to illustrate how we got into such a bad situation in Iraq, and how the Surge is effectively just another bid in a now irrational auction.
A Dollar Auction is easy to understand, and seems be a useful conceptual tool for understanding how certain awful outcomes can result from seemingly (or genuinely!) rational actions.