The NY Times online's "Room for Debate" has some great commentary from 4 different economists on the Geithner Government Hedge Fund plan.  (By the way, as much as we complain about the media let's take a moment to celebrate this.  "Room for Debate" is a great way to collect different viewpoints and let readers draw their own conclusions after reading several opinions.)

There are two key points and Brad DeLong takes the cake by making both of them.  Point #1 is that while Geithner's plan will raise prices on toxic assets, it won't be enough:

"My guess, however, is that we would need to take $4 trillion of risky assets out of the supply currently held by private financial intermediaries to move financial asset prices to where they need to be.

The Geithner plan offers only $500 billion. The Federal Reserve’s quantitative easing plan will add another $1 trillion. I should hasten to say that the administration thinks that information-sharing effects of the plan will do three times as much good in raising asset prices as the simple change in asset supply (I discount that entirely.) So from their perspective the glass is 3/4 full. I think that 3/8 full is better than having no glass at all."

Point #2 is gets to the reason that the available funds won't be enough to raise asset prices adequately:

"Why isn’t the administration doing the entire job? My guess is that the Obama administration wants to avoid anything that requires legislative action. The legislative tacticians appear to think that after last week’s furor over the A.I.G. bonuses, doing more would require a congressional coalition that is not there yet. The Geithner plan is one the administration can do on authority it already has."

So not only are we doing too little too late, the reason that's the case is the Obama administration is scared of Congress.

Update: Brad DeLong clearly wins MPE (Most Practical Economist, a very infrequently used award) today by responding to Krugman:

"And I suspect that in the end we will be driven down the road to some form of bank nationalization — and if that is where we are going Paul Krugman is correct to say that it is better to get there sooner rather than later. But unless Paul Krugman has 60 Senate votes in his back pocket, we cannot get there now. And the Geithner Plan seems to me to be legitimate and useful way to spend $100 billion of TARP money to improve — albeit not fix — the situation.

It has the added benefit, I think, of laying the groundwork to convincing doubters of nationalization: “We tried alternatives like the Geithner Plan and they did not work” might well be an effective argument several months down the road."