t feels strange to write that the US wants to stimulate via government spending, while Europe wants to become more fiscally conservative and reduce government debt.
So, is it just me or do things seem backwards?The U.S. plans to press its economic partners at a summit to move cautiously with plans to tighten their fiscal policies while the global economic recovery remains uncertain, for fear of producing a "Hoover moment."
President Barack Obama, worried the fragile world economy could slip back into recession—as it did in the 1930s during the Hoover administration— plans to urge his counterparts at this weekend's Group of 20 meeting to continue some level of stimulative spending, among other policies, as a way of sustaining economic growth. But at precisely the same time, politicians around the world are starting to embrace a newfound desire for fiscal austerity.
European leaders are more cautious about spending, chastened by the example of Greece, where investor confidence was shattered by mounting debt and the possibility of a default, prompting a nearly $1 trillion rescue fund.
Link to WSJ