Reviewing Obama: How he's done so far
Saddled with epic financial and economic crises, the president has pulled out many of the stops in his first three months in office - to mixed reviews.
NEW YORK (CNNMoney.com) -- In his first 100 days in office, President Obama has made it very clear that he's not afraid to tackle the financial and economic mess he inherited.
"He should be commended for attacking the problem head on and not flinching," said economist Brian Bethune of Global Insight. "The best analogy is the president is sprinting and creating a slipstream for people to get in behind him. And that creates a positive momentum at a minimum in psychology."
Even his critics credit him for coming up with a strong strategy right out of the gate.
"[The administration] identified correctly the three things they needed to do: have a proper fiscal stimulus package; adequately capitalize the banks and stabilize the housing market," said Desmond Lachman, a resident fellow at the conservative American Enterprise Institute.
But on the details and execution of some of his most important actions -- on stimulus, banking, housing, budget and taxes -- Obama has gotten very mixed reviews.
Obama's signing of the $787 billion American Recovery and Reinvestment Act less than a month in office was a considerable victory, but not one born of bipartisanship. To the contrary, only three Republicans voted for the package and all of them were in the Senate.
The biggest controversies weren't over whether a package was needed so much as what should be in it.
"The package is far too backloaded and badly designed to turn the economy around," Lachman said, noting that only a portion of the money is slated to be spent this year when the recession is expected to be most severe.
Both supporters and opponents of the package have criticized various measures in it as not being stimulative, although they differ on which measures make the cut and which don't.
"I'd give Obama high grades for facing up to the economic situation," said Jim Horney, director of federal fiscal policy at the liberal Center on Budget and Policy Priorities. But like a lot of other people, he describes the stimulus package as "pretty good, not perfect."
The price tag was another point of contention. Some said $787 billion wasn't nearly enough, while others suggested it was excessive. It is, in any case, the most expensive bill ever passed.
"[Obama's] gambled a lot that this kind of spending is going to reinvigorate the economy," said American University Professor Allan Lichtman, a political historian and presidential election expert.
His approach differs from that of Franklin D. Roosevelt, whose situation coming into office is perhaps most analogous to Obama's. "FDR was devoted to structural changes," Lichtman said.
In 1934, FDR's first full year in office, federal outlays didn't top 11% of gross domestic product, Lichtman said. By contrast, the White House estimates outlays this year will exceed 27% of GDP and fall to 24% next year.
Not that Obama isn't also eager to make structural change.
The administration is calling for greater risk management of financial firms and creating one consolidated regulator. It has also been working with other countries to better coordinate regulations across international markets.
But the administration's more immediate actions have focused on making sure financial firms remain viable long enough to be regulated more strictly.
Shortly before Obama took office, Congress released the second half of the $700 billion allocated for the Troubled Asset Relief Program.
Much of that $700 billion has been spoken for. And it's expected the administration will have trouble getting more money should it be needed since lawmakers are still angry over the way the TARP money has been used, in part because it hasn't done more to spur lending.
The administration announced it would create a market to buy the banks' toxic assets through a partnership between the federal government and private investors. Treasury Secretary Tim Geithner has said such a solution would be less costly for taxpayers than if the government tries unilaterally to determine the assets' market price.
The program has yet to start and it's unclear how willing private investing firms will be to participate.
Lachman and other critics of the administration's plan would prefer a more radical solution. "The overarching objective of financial sector policy must be to quickly distinguish between solvent institutions, which should be supported, and insolvent institutions, which should be forcibly restructured," he wrote in a piece for AEI.
And he believes Obama and Geithner should not try to make the case that bank restructuring can be relatively inexpensive . "[Obama] should have said on Day 1 the situation was more difficult than he thought and said we have to do some unpopular things," Lachman said.
The estimated cost of a good bank/bad bank solution like the kind Lachman envisions runs in the neighborhood of roughly $1 trillion. The Obama administration has earmarked $100 billion for its new public-private investment partnership and says it has roughly $133 billion of TARP money left to spend.
Much of the populist rage against the bailout stems from the perception that banks, not homeowners at risk of foreclosure, are being helped.
On the housing front, the Treasury announced a $75 billion Making Home Affordable Plan, which it estimates may help as many as 9 million homeowners.
The two-part plan calls for servicers to reduce monthly payments to no more than 31% of eligible borrowers' pre-tax income or to refinance eligible mortgages even if the homeowner has little or no equity.
So far, 11 banks have signed up to participate, and the program is just getting under way so it's not clear yet how it will fare.
The economic crisis wasn't the only fiscal headache Obama tackled. He also submitted a budget for fiscal year 2010 and beyond that made clear his twin desires to implement health care and energy reform while also reducing the deficit.
Budget experts like Horney credit him with calling for health care reform to be deficit neutral and for proposing ways to pay for what are likely to be exorbitant costs, although some of his pay-for proposals haven't been popular with either Democrats or Republicans.
Tax and budget experts are far less happy with the president's tax proposals, which they say run counter to his objective of reducing the deficit in the long run and further complicate the tax code.
His biggest proposal: let many of the Bush tax cuts expire for high-income families (those making more than $250,000) in 2011, and make them permanent for everyone else. He also has called for expanding various tax breaks for lower-and middle-income households.
"There's simply no way that we can get out of the hole if we extend most of the Bush tax cuts, extend most of the expensive new 'stimulus' tax cuts for the middle class and pass a host of expensive new spending programs," Tax Policy Center co-director Len Burman wrote in the Center's blog.