As explained in Innovation Economics: The Race for Global Advantage, the only solution then as well as now is to address America’s real problem: its structural competitiveness crisis. Low interest rates can’t spur spending and investment when wages are stagnant and investment opportunities much richer outside the United States. This is why corporate investment in machinery and equipment has been stagnant over the last five years. And more stimulus would be like an adrenaline shot to a heart plagued with chronic disease. It might get the heart pumping stronger for a while, but without a competitive heart, health can’t be restored.
