Selling economic policy cooperation as a global virtue.

[Kurt_and_Hunter]

We need coordinated global reflation. If it is not coordinated then it becomes a global game of chicken with players hanging back to seek relative national advantage.

Take five major economies... four of them reflate, diluting their currency in the process. The one uncooperative nation gets the global benefit of the others' reflation without messing up her balance sheet. Capital flows to the uncooperative nation--in games theory terms, the defector.

Perfect cooperation in a world of competing national interests is impossible, of course, but more cooperation is better than less.

This matter is bigger than the central bank to central bank level or finance minister to finance minister. B-R-O-A-D national interests are in play.

These matters are not resolvable by the gray men of finance behind closed doors because local politics and public opinion are decisive. Our own congress is living proof of the degree to which diffuse public opinion can hinder the implementation of "right answers."

If I were running things I would, in addition to everything else being done, send Hillary on a European public opinion tour pushing a broad political/diplomatic theme of economic policy coordination as a global virtue. TV appearances, speeches... public outreach. She is well liked by people throughout Europe and commands more public attention abroad than anyone except Obama himself.