Cheaper oil may be last best stimulus

By Christopher Swann
August 10, 2011

Falling crude prices are the silver lining to the market's black clouds. While governments lack economic ammo, one estimate says each cent off gas adds $1 billion to U.S. pockets alone. OPEC is unlikely to intervene any time soon, meaning lower fuel costs could be the only economic booster for now.

Central bank stimulus won’t solve the crisis

July 9, 2012

Fear abounds. The global economy may be teetering. What should central banks do? In the developed world, they should recognise that monetary policy has gone as far as it can without becoming more harmful than helpful. They cannot speed up the slow recovery.

Wen’s stimulus medicine may not be best for China

July 12, 2012

Premier Wen says investment is still key to spurring growth. No one wants to end their reign with a hard landing. His successors may disagree, since stimulating investment will worsen the imbalances they inherit. The economy is slowing, but another stimulus would be a mistake.

China’s big fiscal guns best left in the holster

September 13, 2012

There's room for China to spend its way back to higher growth. Government debt is low, and projects aplenty are waiting to be built. Yet despite the slowdown, political timing and euro uncertainty argue against quick action. For now, leaders can afford to talk rather than do.

UK could raid the rich to boost a poor economy

November 30, 2012

George Osborne faces a big test in next week’s interim budget. The Chancellor must stimulate growth while tightening fiscally. His wiggle room is small. But he could serve both aims by grabbing back perks from the rich to fund tax cuts for the poor and a bit of capital spending.

Obama’s offensive may not charm business or GOP

September 7, 2010

President Barack Obama's economic offensive may not charm business or Republicans. The president's plans to spend $50 billion on roads and railways and grant businesses $300 billion of investment tax credits have merit. But they don't look enough to sway a disillusioned corporate America already wondering about the fate of $4 trillion in soon-to-expire tax cuts from the Bush years. And the GOP is in no rush to pass a second stimulus before looming midterm elections.

Obama pulled two ways on stimulus 2.0

September 2, 2010

Departing White House economic adviser Christina Romer says last year's $814 billion stimulus package fell short. That may suggest those arguing for more fiscal action are gaining ground with the administration. But short of a renewed economic slump, electoral politics are working against more stimulus.

U.S. state and local finances in big double-dip risk

July 7, 2010

U.S. state and local finances have become truly alarming. At $144 billion the combined budget gap this year for the 50 states is higher than the $133 billion of the previous year. What's more, last year's federal stimulus funds, which helped mitigate the gap, will end by December. Since their finances are highly dependent on the economy, if the recovery slows or double-dips, states and local governments could suffer more pain than any other player save the long-term unemployed.

Scrambling on job creation

November 12, 2009

The new emphasis on jobs might be too late. Indeed, new is the appropriate word since the first package was not geared toward creating jobs so much as increasing economic output, as Lawrence Summers recently clarified.

Obama’s economic bet may cost Democrats

October 29, 2009

The third-quarter GDP report is another indication that President Barack Obama's economic gamble may yet fail to pay off.