Few countries are choosing to follow
Published 12:00 am Sunday, November 28, 2010
Increasingly, the United States finds itself on a unilateral economic stimulus path. That was glaringly evident at the Group of 20 economic summit, where the world’s leaders rejected President Barack Obama’s strategy for reviving the global economy through massive government spending programs.
Nearly to a nation they rejected that approach in favor of one that depresses spending to reduce deficits and restore stability. Germany, Britain, Brazil and even China told Obama that the focus must be on deficit reduction.
In addition, the administration’s latest risky bet on flooding the economy with dollars to spur growth drew sharp rebukes from a world worried that a devalued dollar will trigger runaway inflation and end the recovery. The $600 billion quantitative easing embarked on by the Federal Reserve also weakened Obama’s standing to challenge China’s currency manipulation.
German Chancellor Angela Merkel scolded the president to worry first about fixing what’s wrong with the U.S. economy before attacking those countries that “have been most competitive.”
We have never believed that the economic policies of the United States ought to be driven by world opinion. But on the other hand, if everyone else is heading in one direction, and we’re heading by ourselves in another, it should be a warning flag.
That’s particularly true since the other approach seems to be producing better results, at least in some places. In Germany, for example, Merkel chose not to spend on stimulus and her country is now in the midst of Europe’s most vigorous recovery.
The treatment of the president and his ideas at the G-20 summit should worry those who feel America should be the global economic leader, and not a follower. Few countries are choosing to follow where Obama wants to lead them.
That should at the very least cause him to pause and reassess the wisdom of his policies.