No one has yet put a price tag on that effort. But the administration’s diagnosis of what went wrong with the first attempt to right the financial system — that it was too small, and that the problem has ballooned in recent months — suggests that the next effort will almost certainly entail a far bigger commitment of taxpayer dollars than the $350 billion left from last year’s $700 billion effort to right the system, and probably far more than the stimulus package…
“We know what we need to do: inject capital into the banks, clean up their balance sheets, get rid of the bad loans in their portfolios that are clogging up the arteries,” a senior member of Mr. Obama’s economic team said, declining to speak on the record ahead of Mr. Obama’s news conference and Mr. Geithner’s announcement on Tuesday. “But the perception is that you are bailing out a bunch of Wall Street bankers, and even many Democrats are going to rebel at that.”
