An Economic Recovery Program for the Post-Bubble Economy

Abstract:

The American economy is in trouble. By the time a new president is sworn in, there is a good chance the economy will have stalled again, and the hope for a relatively quick rebound will have given way to the fear of a protracted slowdown. A longer-term economic recovery program must therefore steer the economy onto a new growth path that is less dependent on the debt-financed consumption that has driven economic growth over the past decade.

The most promising new sources of growth are America's enormous public infrastructure needs and the increased global demand for American technology created by the drive for greater efficiency in economies around the world. An economic recovery program built around public infrastructure investment and demand for American technology would be more effective in stimulating the economy in the short term, and far better for it in the long run, than would another round of tax rebates for American consumers.