In his April Economic Outlook, American Enterprise Institute (AEI) economist John Makin assesses the risks the world faces as a result of China’s slowing economy. With the coming transition in Chinese leadership, it is unlikely that the world's second largest economy will alter its policies to stimulate growth. As a result, the whole world may feel China's pain.

Attempts at austerity and deleveraging in Europe have converted an economic problem into a political dilemma, with leftist governments rising against Germany's austerity-laced rescue packages. Germany now faces a tough economic decision that will involve choosing between a breakup of the current euro system and a movement toward a common fiscal policy in Europe.

Despite frequent, dire warnings about the unsustainability of government budget deficits in the United States, Europe and Japan, investors are lining up to lend to some governments at very low interest rates.

In anticipation of President Obama's budget reform speech on Wednesday, April 13, several AEI scholars will be available to comment on the economic and political implications of the speech: Andrew Biggs, John H. Makin, Vincent Reinhart, Alan Viard, Michael Barone, Karlyn Bowman, and Norman J. Ornstein.

All eyes were on AEI in April when House Budget Committee Chairman Paul Ryan (R-Wisc.) came to AEI to unveil his plan to cut more than $4 trillion from the federal deficit.

China's new leadership is threatening to stay content with slower economic growth, and the country's manufacturing, housing, and export sectors are experiencing problems. Nonetheless, China has an opportunity to influence economic growth in 2012 through stimulus measures to its own economy.

As fiscal stimulus packages unwind, fiscal drag may rise in the United States to a level equivalent to about 1.5 percentage points of GDP early in 2012.

After many years of false starts, the Japanese economy may finally be set to boom—or at least to enter a period of sustained growth with a sharply rising stock market.