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Increase In Spending May Not Be the Answer, Says Economist

Friday, July 9, 2010

Are we headed for a double-dip recession?

That answer may not matter as much as what we do and don't do in the interim, say some economists.

"To just ramp up spending because we think the economy might weaken if we don’t just spend more money isn’t the right answer. And if we have to endure a double-dip recession because we’ve got to work our way out of this debt problem, then I think we have to do that," Dean Mike Knetter told the Small Business Times when asked how we may evade round two of the economic crisis.

"The federal government is spending ample amounts of money right now, given what I think are the available good projects they can undertake,” said Knetter. “I think it’s been hard for us to get the federal stimulus money working on things that we feel are productive projects in the first place."

Knetter graduated from Stanford University with his Ph.D. in Economics. He served on the President's Council of Economic Advisors for Presidents George H.W. Bush and Bill Clinton.

Read the full article here.