Editorial Board
Fiscal Stimulus Revisited
Monetary policy is suffering from diminishing returns. It's time for governments to act.
More fiscal stimulus, please.
Photographer: Richard Baker/In Pictures/Getty ImagesBudget deficits may be coming out of retirement. With economies all over the world growing too slowly and little scope left for new monetary stimulus, governments are turning their attention back to fiscal policy.
This shift in thinking is overdue. In many countries, though not all, fiscal expansion is not just possible but also necessary. A resumption of budget activism, if it happens, won't be riskless, so caution will be needed. A stubborn commitment to fiscal austerity, though, would be riskier still.