The Kroog Versus The Kroog's Desire To Say I Told You So On The Stimulus

And, well...he kinda fails on that.  But he's not wrong, either.

About the stimulus: it has surely helped. Without it, unemployment would be much higher than it is. But the administration’s program clearly wasn’t big enough to produce job gains in 2009.

Why was the stimulus underpowered? A number of economists (myself included) called for a stimulus substantially bigger than the one the administration ended up proposing. According to The New Yorker’s Ryan Lizza, however, in December 2008 Mr. Obama’s top economic and political advisers concluded that a bigger stimulus was neither economically necessary nor politically feasible.

Their political judgment may or may not have been correct; their economic judgment obviously wasn’t. Whatever led to this misjudgment, however, it wasn’t failure to focus on the issue: in late 2008 and early 2009 the Obama team was focused on little else. The administration wasn’t distracted; it was just wrong.

The same can be said about policy toward the banks. Some economists defend the administration’s decision not to take a harder line on banks, arguing that the banks are earning their way back to financial health. But the light-touch approach to the financial industry further entrenched the power of the very institutions that caused the crisis, even as it failed to revive lending: bailed-out banks have been reducing, not increasing, their loan balances. And it has had disastrous political consequences: the administration has placed itself on the wrong side of popular rage over bailouts and bonuses.

And he's right.  Obama should have swung for the fences on the stimulus and then dared the Republicans to stop him.  Instead, he bunted and got on base.  It was easier for him to do so...but it didn't score any runs.
(More after the jump...)




He absolutely should have come down like the Right Hand Of God on the banks however.  He didn't.  It looked like he gave them a pass, and it set the tone that if Congress gave them a pass, it would be okay.  It was never okay.  That was the one thing Obama sorely misjudged and misjudged completely, the rancor out there against the banksters.

Only now is he starting to learn.  It may be largely too late, except for the fact being brutal to the banksters is the main difference splitting the teabaggers from the country club Repubs.  If Obama can use that, he can make some headway this year.  But he has to be brutal and bloody with them.

[UPDATE 10:34 AM] As Steve M. reminds me Obama's failure to be brutal with the banks has allowed them to cast themselves as the victims here.

Reagan spent eight years in office talking as if he were broadcasting from a samizdat radio station and the powers that be might get him any minute. He persuaded people that he was the outsider, even after he'd been in office for years. After a year of Obama, people may believe in their heads that Bush was the enemy, but in their hearts they blame Obama, because he doesn't seem determined to define an enemy (Republicans? the bankers? the insurance companies?), except occasionally.

So the teabaggers have stepped in and defined him as the Big Kahuna, the guy who must be toppled if we're to have change. Hell, they're defining big banks as fellow insurgents.

And they're winning.

The trillion-dollar banking industry is making money in the "Obama economy" the Teabaggers say, and Obama's trying to shut them down.

"Win one for the banksters!" should be laughed off the face of the Earth.  They destroyed us.  It's a testament to Obama's performance here that this message of "unprecedented regulation" after an industry lost trillions of our dollars is starting to take hold among voters.