The more immediate problem facing the economy is the high unemployment rate, the risk of a largely jobless recovery, and a lost generation of prosperity.

At the founding conference of the Institute for New Economic Thinking, one appreciates how much the Obama administration could learn from foreign observers of the financial crisis, who are far ahead of American thinking.

The SEC's suit against Goldman Sachs is a start. Before this is over, senior executives need to be brought before the bar of justice and the existing system and its biggest players need to be broken up.

If a bipartisan strategy is adopted on financial reform, both parties will declare victory and go home. Some of Obama's advisers think this is smart politics. They should think again.

Obama realizes that public opinion is moving in the direction of tougher banking reform, and learned from the health debate that bipartisan compromise on key reform issues is a snare and a delusion.