We're struggling with this at our house as well. Based on my own crippling experience, which I'll spare you, I think you're right to want to intervene. Have you read the Optimistic Child? It outlines an intervention for curbing children's "negative self-talk" and "catastrophizing," which the author warns can lead to escalating anxiety and childhood depression. The book argues strongly (with supporting quantitative research data) that optimism and perseverance can be taught--that you can teach your child to talk himself down from a tearful "I can't do it!" to a calm "I can't do this yet."