"The bigger blow to Mr Obama comes not so much from the failure of a project that was never, given the nature of politics, really viable. It is that the latest episode contributes to a surprising picture of incompetence that is building up around his presidency. This is the third of his cabinet nominations to go down in flames, and he has also lost the woman whom he had hoped to appoint to the job of chief performance officer to the government. He should additionally count himself extremely lucky that he did not lose his treasury secretary, Tim Geithner, who failed to pay some of his taxes and who would surely not make it through to confirmation if he had to do now rather in the first post-inauguration flush."

This blog has long been skeptical of Mr Obama's bipartisanship and his claimed effectiveness at surrounding himself with a strong team. This many resignations is extremely abnormal and, as the Economist says, extremely incompetent.

More importantly, your correspondent disagrees completely with Mr Obama's rhetoric. Mr Obama's unceasing criticism of bankers and all the heads of the companies who are receiving government aid as well as his doomsday predicaments if the stimulus is not passed stinks of populism. Economies always recover; this recession bears none of the signs of the Great Depression -- the world and the US will climb out of recession after shoddy corporations and prices are corrected.

But bashing executives does not help. Indeed, how does Mr Obama's accusatory rhetoric help improve confidence in the management of those companies? Maynard Keynes understood better than many of his contemporaries that psychology plays an important role in economics. When people have no confidence, they will keep their money close to their chests. Mr Obama ought to engender confidence in the financial industry: the economy cannot recover so long as credit remains scarce. The interbank lending rate is at .95 (a healthy economy has a rate of 0.35) down from the 3.xx rates last year. That is good; it must improve.

Mr Obama must use his rhetoric to build "hope, not fear," as he promised in his campaigns. Economics, Keynesian, supply-side, or classical, will play its part. But Mr Obama must use his rhetoric to engender confidence. And he must also shed his mantle of incompetence to bolster confidence in his leadership and his government.