The International Monetary Fund has called for a global fiscal stimulus of 2 percent of GDP. In 2009, U.S. and Chinese stimulus spending is likely to exceed that target. European stimulus will be less than half that amount. Is the burden of world economic recovery being adequately shared? If not, who needs to do more and in what fashion? And how should the global community exert peer pressure to encourage burden sharing?
-- Bruce Stokes, NationalJournal.com
The proposal outlined last week by Treasury Secretary Timothy Geithner has been criticized for vagueness, for relying too much on the private sector, for not demanding enough of the private sector, and for punting on several issues. How would you improve it?
-- John Maggs, NationalJournal.com
4 responses: James K. Galbraith, John Maggs, Edward Leamer, Peter Wallison
Assuming Congress passes an $800 billion fiscal stimulus plan this week, considering recent news on the economy, is this enough? What further fiscal action might Congress and the public support, based on how difficult it has been to find a consensus so far? Could the Fed do more to stimulate the economy, and should the emphasis switch to Fed action?
-- John Maggs, NationalJournal.com
4 responses: James K. Galbraith, Ryan Ellis, Desmond Lachman, Grover Norquist
A crucial question is whether President Obama's policies will restore confidence in the government's commitment to taking politically unpopular steps to help the economy. Putting aside disputes about the effectiveness of one form or another of the stimulus legislation, does it bolster confidence for Obama to say that he can keep taxes low, maintain social benefits, and put the budget on a path toward fiscal balance? Even if he has no choice politically, is there a cost to the economy to maintain this posture? Are there economic benefits to taking this line, even if the facts suggest it will be impossible?
-- John Maggs, NationalJournal.com
8 responses: Brian Riedl, Gary Burtless, Jeffrey Frankel, James K. Galbraith, Isabel Sawhill, Charles Calomiris, Bob McIntyre, Alan J. Auerbach
