The editors of the Wall Street Journal have a scary editorial on the global economy, as reflected in yesterday’s international selloff:
“Yesterday’s selloff suggests that Europe and Asia are in for a bumpy ride as the U.S. economy tries to right itself. Traders in those markets apparently don’t have any more faith than we do in the ‘temporary’ stimulus packages being discussed in Washington. All the more reason for policy makers to seek their own pro-growth policies, not least by continuing their attempts at tax, labor and financial reform. That’s especially true of countries that rely heavily on exports. It’s time to focus on policies that can create more domestic prosperity.”
If you read carefully, there’s a glimmer of hope: pro-growth policies. There are so many people today who know that the Social Security system is in trouble, and yet want to enlarge the purview of government. We need tax cuts and attempts at reform, not burdensome new programs.