Today, in newspapers worldwide, President Obama called on nations to stimulate their economies, but Europe isn't sold on the idea. Europe's leaders are viewed as cautious, but perhaps their “policy is appropriate for European conditions,” Jack Ewing writes in Der Spiegel. For one thing, Europe already spends much more on the public sector than the US, as Europe’s central bank president told the Wall Street Journal yesterday.
More such spending could hurt confidence by sparking tax and inflation fears, Jean-Claude Trichet said. Further, in countries with export-based economies, a stimulus wouldn’t do much—what they need is more external demand. The media needs to stop obsessing about comparing stimulus plans across the Atlantic, Trichet says. “It is not a race! We are all doing what we judge optimal taking into account the different characteristics of our economies.”