My biggest concern about the stimulus package being debated todeath in Congress is not that it won't help jumpstart the moribundeconomy over the next couple of years, but that so many will bedisappointed it's not a miracle elixir, they'll lose confidence inthe government's ability to make a difference, and prolong therecession by sitting on their cash.

That's the impression I had after listening to a doom-and-gloompanel discussion featuring an investment analyst and four businessjournalists last night. The panel–moderated by Business Week'seditor, Steve Adler–touched on a number of very interesting pointsto keep in mind as the Obama administration tries to rejuvenate thesinking economy.

Although the panelists were not optimistic the stimulus packagewould turn the tide anytime soon, there was praise for itsstructure, as it's designed to deliver a one-two punch to elementsthreatening to drive the economy into oblivion.

The plan offers an urgent, though short-term boost to our safetynet, delivering additional dollars for unemployment benefits, foodstamps and health insurance to prop up the millions losing theirjobs. It also gives a life-line to bankrupt state governments, andperhaps helps them avoid laying off workers and putting off majorprojects to close widening budget deficits, which would be ananti-stimulus to an economy already crippled by similar contractionin the private sector.

Long-term, the stimulus package offers a “time-release capsule,”according to one of the journalists on the panel, by injectingfederal funds for job-creating infrastructure projects into thesystem over the next six-to-18 months.

However, the danger, as I see it, is that the stimulus packagewill be misperceived by a desperate public as a panacea that will“solve” our economic problems and ignite growth overnight.

In fact, this is a band-aid to help slow the bleeding as wehermorrhage hundreds of thousands of jobs, with many more layoffsto come over the next few months. It is meant to cushion the blowand bring victims of the economic meltdown to a softer landing,while helping spark a quicker turnaround in the medium-term.

The growing emphasis on tax cuts, rather than spending, beingdriven by Republican naysayers will also slow down and lessen anypositive effects of the stimulus, I fear.

Congress and media gadflies are lamenting the price-tag of thestimulus bill, as if the $800 billion or so being discussed is allwe'll have to spend. In fact, President Obama and Congress mustprepare the public to expect calls for trillions more. Thisstimulus bill is merely a down payment–the first baby steps on avery long road to recovery.

The panel emphasized there are much bigger challenges ahead,both short- and long term, in getting the economy back on a solidfooting, and it's all going to cost a lot of cash.

For example, the banking system remains in a precarious state,and until that's rectified, the economy is operating with a knifein its gut. We cannot have sustained economic growth with a creditsystem on life support.

But what will the Obama administration do to secure the bankingsystem? Will they follow the lead of their predecessor and simplyinject hundreds of billions more into individual banks, in returnfor taxpayer equity? Of will they return to the roots of theTroubled Asset Relief Fund, taking toxic assets off the balancesheets of banks, thereby allowing lendors to move forward withoutsuch dead weight to hinder their renewal?

A critical element fueling the banking problem is the deepeningmortgage crisis. With millions losing their jobs, how many morepeople will lose their homes this year and next? And how big of adrag will that be on our economic recovery? This is why Rep. BarneyFrank, D-Mass., chair of the House Financial Services Committee, isso insistent on including foreclosure relief in the next wave ofTARP bailouts. At best, people will no longer be able to use theirhomes as cash machines, cutting off a key source of financing forconsumer spending.

Then there is the auto industry to worry about, one panelistrepeatedly pointed out. While an emergency cash infusion of dubiousconstitutionality from the TARP program in December is helping keepChrysler and General Motors in business (Ford has thus far declinedUncle Sam's helping hand, courteously), the auto makers will beback (without their private jets, one hopes) to beg for morerelief, with sales at a standstill.

Should one or both of these major U.S. manufacturers go under,that could not only overwhelm whatever positive effect we mightenjoy from the stimulus package, but deliver a death blow to theeconomy for years, as millions more could lose their jobs, withlittle hope of going back to work anytime soon. Where willPresident Obama and Congress stand on that critical challenge?

The panelists dismissed any fears of inflation from all themoney being artificially pumped into the economy by Washington,echoing most economists who say the cost of doing nothing would befar higher than massive deficit spending–at least in the short- andmedium term.

Given the surplus labor in the market and the standstill inconsumer spending, it's hard to imagine prices soaring out ofcontrol anytime soon. Indeed, deflation is more of a concern if theeconomy keeps imploding. (Still, as Treasury's printing presseschurn out trillions to keep the economy liquid, I have nightmaresof a Weimar Republic scenario down the road.)

Then there is Social Security and health insurance to reform,with massive bills to come due at some point.

Also, keep in mind we have two wars in progress. While PresidentObama is likely to wind down operations in Iraq over the next twoyears, he has vowed to substantially boost our presence (and costs)in Afghanistan over the same period. That might be good news forthe defense contractors and give some communities who depend onsuch firms an economic boost, but with all the other challenges weface, the wars remain a huge drain on our economic strength.

During the panel discussion, there was some grumbling abouthaving a “rookie” president in charge at a time of such historiccrises, but in my view, it all depends on who that rookie is.Adding a “Michael Jordan” to a roster would turn around the worstof teams, and Obama is the Jordan of politics right now. Having aleader as bright, reasoned, cool, collected, charismatic andfocused as Barack Obama in charge is an advantage, not a weakness,in our current plight, I believe.

There was also a question from the audience about whether “pressnegativity” is having a “multiplier effect,” helping convincereaders/listeners that we are all doomed, undermining consumerconfidence and discouraging the spending and investment needed tospark renewed economic growth.

The panel of journalists, even in a room filled with their mediapeers, seemed embarrassed by the question, insisting they try tofind a positive side to every story they report, and offer someglimmer of hope to their audiences. Frankly, that's not the job ofthe press. The media need to stay focused on what the public andprivate sectors are doing to get out of this mess, not sing uslullabies to help us sleep easier at night.

In addition, one panelist noted that such criticism is unfair,given how the media has been taken to task for not bringing tolight earlier how fragile the economy really was, and how recklesswere the investments (in subprime mortgages and credit defaultswaps) that brought us to our knees. Closer to home, anotherpanelist pointed out how hard it is for the media to remain upbeatwhen their own industry is being destroyed by layoffs.

Finally, it was surreal to listen to such a grim panel after theswank reception welcoming the attendees, courtesy of McGraw Hill. Avariety of groups were given invitations (mine came via the NewYork Financial Writers Association) to attend at no charge and hearthe panelists offer their views, with the function arranged byColumbia University's Knight-Bagehot Alumni Committee (ascholarship program for business journalists).

We were on the 50th floor of the McGraw Hill, offering abreathtaking view of midtown Manhattan. There was a multitude ofdelicious finger foods, washed down by top-shelf booze from an openbar–with single malt, 12-year-old scotch the drink of choice formany, including yours truly.

The room buzzed, and for a moment it didn't feel like we wereall traveling on a sinking ship. But once the program began, I felta bit like I'd been drinking champagne after the Titanic hit theiceberg. Might as well enjoy whatever good times remain while theylast, right?

What do you folks make of the economy and the government'sattempts to turn things around?