What the chart (courtesy of Geoff) at the bottom illustrates is a point that I have been writing about for the better part of a year, Washington has been slow to recognize that we have a significant problem, they have been lethargic in their response to it, and their "solutions" have been impotent.
The problem with Washington underestimating the gravity of the unemployment situation is that it calls into question the effectiveness of every other piece of legislation that has been passed or action that has been taken. From the bank stress tests, to the $8,000 first time home buyer tax credit, to the $787 billion "stimulus", to the Fed's reckless decision to invest $1.25 trillion in mortgage backed securities.
Despite all of this "stimulus", the economy and housing market continue to deteriorate. Credit card and mortgage defaults are only accelerating, and yes, the unemployment rate is nearly two points higher than Washington thought it was going to be.