One of the problems with the idea of a hydrogen economy as an alternative to an oil economy is that the comparison implies that hydrogen will take the place of oil. This is not true: most of the hydrogen on Earth is already oxidised and as such requires more energy to liberate than could be gleaned from hydrogen as a primary power source.
Putting aside nuclear fusion (not because it is totally unfeasible or anything, just that there is no guarantee of a workable solution soon enough to solve our impending global warming and peak oil difficulties, either from ITER or various other interested parties in aneutronic fusion).
But if you're talking about hydrogen as an alternative to gasoline in cars then hydrogen is a bit of a roundabout way of doing things. Hydrogen fuel cell cars would function in a similar way to electric cars. A report from Ulf Bossel (organiser of the European Fuel Cell Forum and general fuel-cell bod) last December points out some of the problems with hydrogen in this context. Another criticism of GWB's presidential initiative comes from Robert Zubrin's book The New Atlantis.
So far my favourite option for the automobile of the future is the ultra-capacitor. This way electricity from the mains (generated by nuclear power and space-based solar-power-beaming stations) could be used to "fuel" autos. The most compelling (i.e. the only one I've come across) of these schemes is EEStor Company of Cedar Park Texas. I think that right now we should concentrate on electric-petrol hybrids and then, depending on how soon ultra-capacitors can be made to work, gradually migrate to an electric-based transport paradigm (Eeew, sorry, but I just had to use paradigm - it's the RIGHT WORD damnit!).
Transport accounts for around 10 % of European carbon dioxide emissions. Removing our requirement for petroleum to fuel cars would be a big step in the right direction, even if it only means the problem of energy production is elsewhere.