When the G8 major economies convened at Camp David last weekend, the continuing crisis of the euro, common currency of 17 European Union (EU) members, dominated the economic discussions. The agonies of Greece, badly divided in recent parliamentary elections, and forced to vote again on 17 June, were at the forefront.

Developed economies are implementing massive fiscal stimulus packages, but fiscal multipliers are not certain, financing budget deficits will not be easy, the risk of default looms, and central bank independence may be eroded.

There is still much that we do not know about the proper design of fiscal stimulus.

Institute an immediate and permanent reduction in the payroll tax.

Until recently, there was wide consensus among macroeconomists that activist fiscal policy was inadvisable.

The use of fiscal stimulus is appropriate because the current recession is much deeper than and different from previous downturns.

Breaking windows will stimulate the economy, according to a leading public pension advocacy group. Skeptical? The National Institute on Retirement Security (NIRS) has not literally endorsed breaking windows, but a report recently published by the organization relies on the same economic fallacy.According to NIRS-whose membership consists principally of...

The Obama administration's plan seems designed to keep its current footprint on the budget as small as possible.