Paul Krugman, as usual has nothing much to say. I love this line though.

When the political apparatchiks who make all decisions in this administration want Mr. Mankiw's opinion, they'll tell Mr. Mankiw what it is.

And when Howell Raines wants your opinion, he'll tell you what it is.

then there's this;

Then there's the effect of the worst fiscal crisis in the 50 states since World War II. Iris Lav of the Center on Budget and Policy Priorities suggests that tax increases and spending cuts at the state level could drain $100 billion from the national economy over the next year. Aid from Washington is an obvious answer — but the Bush administration refuses to provide a penny.

The reason that states are in the worst fiscal crisis is that the governors of those states, Republican and Democratic, didn't see what everyone else saw. The economy could never retain the heights it reached in the late 90's. They spent and spent without thinking about the long term. The Bush administration is thinking about the long term. Long term security for America. Without security, the economy will suffer worse than we've ever predicted.

So where's the upside? To be fair, there are some reasons for hope. Most notably, after two years of low business investment, there's presumably a pent-up demand for new equipment. As I understand it, the prevailing view at the Federal Reserve — which is considerably more optimistic than private forecasters — is that once war fears are behind us, business investment will surge, and all will be well with the economy. Sounds like wishful thinking to me, but let's hope they're right. Also, war itself can be an economic stimulus, as the Pentagon replenishes the munitions it uses up in Iraq

This is true. Business must upgrade older equipment. As for the Federal Reserve, didn't they warn of "irrational exuberance"?
Krugman is the leader in hoping that the economy doesn't improve until, say...January 20, 2005.