History illustrates how tricky it can be to make public spending work as intended. The many dams Franklin D. Roosevelt’s administration built generated an abundance of electricity, lowering its cost so that families could afford to operate the appliances then becoming available. The construction itself put money into workers’ pockets. But the appliances were too costly for most families during the Depression, and the manufacturers wouldn’t extend credit. For all the money spent by the Roosevelt administration, public investment was failing to jump-start a key private-sector industry.

His administration was inventive, however, and found a way around the problem by subsidizing installment purchases. That was when appliance production finally rose. In time, installment plans evolved into consumer loans and charge cards, and that helped make the American consumer economy the envy of the world.

These symbiotic relationships between the public and private sectors — playing off each other in ways hard to anticipate and hard to channel — became an essential ingredient of American prosperity from World War II until the mid-1970s.

But Mr. Obama is bucking a deep private-sector funk, a bit like what Roosevelt described in his first Inaugural Address as “fear itself — nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance.” Borrowers and lenders have pulled back. Business investment has plummeted. So has consumer spending. “A psychology of bad times is becoming the mindset of the public,” says Andrew Kohut, director of the Pew Research Center, a survey operation.

Whatever the obstacles, Mr. Obama’s plan would mean giving up the view — widely held since the 1970s by economists, policy makers and business executives — that the private sector, by itself, is the key source of prosperity and full employment, and government spending is inefficient.

With all his attempts to rescue the country from financial ruin could be a beast in the making.  In essence a trap that once sprung could never be closed again.