ROBERT KUTTNER

I came away even more bewildered and dismayed at the reality that this president, who could have been such an insurgent at a moment demanding insurgency, has been so utterly captured by the Wall Street elite, the health insurance industry elite, and the military elite.
President Obama:
We have a structural deficit that is real and growing, apart from the financial crisis. We inherited it. We're spending about 23 percent of GDP and we take in 18 percent of GDP, and that gap is growing, because health care costs -- Medicare and Medicaid in particular -- are growing, and we've got to do something about that.
on top of that the huge loss of tax revenue as a consequence of the financial crisis,
greater demands for unemployment insurance
smallest layer
Recovery Act.
The last thing we would want to do in the midst of a -- what is a weak recovery, is us to essentially take more money out of the system either by raising taxes or by drastically slashing spending.

Having said that, what is also true is that unless businesses and global capital markets have some sense that we've got a plan, medium and long term, to get the deficit down, it's hard for us to be credible, and that also could be counterproductive.
difficult a economic play
which is to press the accelerator, in terms of job growth,
when to apply the brakes in the out-years, and do that credibly
This response was pitch-perfect. Let's see how hard the president fights for more deficit spending to put Americans back to work, and whether his State of the Union Address is as good as this impromptu answer.
It was the same week that Obama decided to buckle to the pressure from his generals on Afghanistan.
It was also this week that key House Democrats caved in to Goldman Sachs on the issue of derivatives regulation,
Bottom line: the industry's lucrative and high-risk practices of creating and trading most derivatives outside regulated exchanges will likely continue.

Where was Obama in all of this infighting? The kindest interpretation is that he was distracted by the health insurance bill, and by Afghanistan, and simply letting Geithner run the show.