Fear of Failing

Underlying all the finger-pointing about what went wrong and the nervous apprehension over how to fix the economy is a feeling that generations of us have never had--being unable to control our own future.

The hopeless faces in those Dorothea Lange and Walker Evans photographs of the Great Depression are alien to 21st century Americans, but some of their dread is seeping into the debate now as a confident economist like Paul Krugman offers his nightmare scenario:

"It takes Congress months to pass a stimulus plan, and the legislation...is too cautious. As a result, the economy plunges for most of 2009, and when the plan finally starts to kick in, it’s only enough to slow the descent, not stop it. Meanwhile, deflation is setting in, while businesses and consumers start to base their spending plans on the expectation of a permanently depressed economy--well, you can see where this is going.

"So this is our moment of truth. Will we in fact do what’s necessary to prevent Great Depression II?"

Evidence that the Obama administration shares that feeling can be seen in the news of an extraordinary offer of immediate $300 billion in tax cuts for individuals and businesses to gladden the hearts of Congressional conservatives and bring them on board quickly for stimulus legislation.

"The End of the Financial World as We Know It," an analysis of the meltdown in the New York Times this weekend claims that "18 months into the most spectacular man-made financial calamity in modern experience, nothing has been done to change...bad incentives that led us here in the first place.

"Say what you will about our government’s approach to the financial crisis, you cannot accuse it of wasting its energy being consistent...In the past year there have been at least seven different bailouts, and six different strategies. And none of them seem to have pleased anyone except a handful of financiers."

There is a growing sense now that this is our last chance to get it right and as a result, in the months ahead, America will be fighting against both economic and psychological depression.