Economic quicksand and Congressional fatcats

James Galbraith has seen it coming and says he's beginning to feel "vindicated." 

I'm just scared, are you? 

Galbraith warned from the get-go that Bush's stimulus package wouldn't work, that Obama's was insufficient*, and it looks as though he's right.  He has also been a fierce critic of "toxic assets."  He was on the right track there, too. From McClatchy:

In March, Treasury Secretary Timothy Geithner unveiled a Public-Private Investment Program in which the government and private firms would bid together to purchase toxic assets from banks, freeing them to increase lending and help revive the economy.

The program's still not operating.

"We're committed to getting it done, and expect to have it very, very soon," said Andrew Williams, a Treasury spokesman. "It's complicated and takes time."

Until the banking sector fully recovers, experts warn, the economy will face a long slog back.

"I don't see that we've put in place the foundations for a durable recovery. The freefall is over, and that allows some of the positives to show . . . but that doesn't mean that 2010 is a lock for expansion," said Vince Reinhart, a former top economist at the Federal Reserve.

McClatchy describes the economy as "stuck in quicksand."

How the Republicans are taking the prospect of deeper recession -- okay, let's say it, depression -- is summed up in a paragraph in WaPo.

With many economists forecasting that the jobless rate will continue to climb -- and is likely to stay above 10 percent through much of next year -- Republicans vowed to make the 2010 midterm election a referendum on Obama's stewardship of the economy. "I think they're going to have some significant problems," said  Sen. John Cornyn (R-Tex.), who leads the GOP campaign operation in the Senate, "and I view those as opportunities for us."

As noted earlier, Harper's has a very illuminating article on the parallels between the Hoover and Obama administrations -- and the parallels extend to Congress in the early '30's. 

More on what Galbraith -- and other economists and political analysts -- are saying about the economy in July 2009 here.

____

*This is the fault of the overly conservative members of the White House economic team and a pusillanimous Congress.  That word has to be the source for "pussy" in the sense of scaredy-cat.  Among other things, Republican members of Congress, for all their caterwauling, really are pussies.

Comments

[News Reference]

Obama's conservatism has been underreported.

Obama offered a conservative recovery plan and the right wing extremists controlling the Republican Party watered it down with the help of the Blue-Dogs (AKA: Moderate Republicans masquerading as Dems).

[PW]

His conservatism has been getting a lot of comment on this blog, though, going back to his campaign when much of the discussion was about the cross-overs from the Republican party who were supporting him.