From The Boston Globe — Originally published Thursday, Feb. 12

The plan [Treasury Secretary Timothy Geithner] announced Tuesday was in most ways too vague, and in some ways too cautious, to calm anxieties about the financial sector and the U.S. economy as a whole.

… Geithner unveiled a few helpful ideas: He would “stress test” the health of large financial institutions and demand that those receiving government bailouts show how the money is contributing to new lending. But the plan falls short in other ways. The Obama administration is committing to a $50 billion plan to contain the foreclosure epidemic … but has not settled on the details of that plan.

Furthermore, the Treasury has laid out only the vaguest outlines of another of Geithner’s central initiatives, a “public-private investment fund” of $500 billion to $1 trillion. The goal is to involve private capital as well as taxpayer money in buying up toxic assets from troubled banks. But Geithner offered little detail on how such a mechanism might work. …

Other Obama aides reportedly wanted to wipe out existing managers and shareholders; Geithner’s more conciliatory approach toward Wall Street won out. But in the end, the government may have to take more aggressive steps — including taking direct control of troubled banks that turn out to be insolvent and then getting rid of their toxic assets. Neither Congress nor the White House shows any appetite for steps that smack of Sweden or Venezuela. Yet if the collapse of the financial sector has become the government’s problem, then the government needs the tools to address it. …