Too late to rescue U.S. economy?

The rescue brigade has finally arrived, but does it know what to do? And isn't it already too late?

The economic rescue brigade finally arrived in something like full force last week, about a year after experts dismissed warnings of a U.S. economic downturn with global consequences, and five months after world credit markets were thrown into turmoil by the collapse of the U.S. housing boom.

It has not been an edifying sight.

Stephen Harper, the Canadian prime minister, announced a $1 billion assistance fund for one-industry towns hard hit by forestry mill closings – a trend, and a hardship, that's been evident for more than two years now. The premiers promptly responded that the sum wasn't sufficient. Ontario's all-important auto sector alone could swallow up that bailout sum. With its output largely exported to the U.S., it will be in grim shape by year's end if, as expected, tapped-out American consumers cut back sharply on vehicle purchases.

U.S. president George W. Bush was said last week to be contemplating a grandly titled economic stimulus package, probably to be unveiled at the time of his Jan. 28 state of the union address. Like most non-military challenges faced by Bush, the tonic will likely be more tax cuts, further eroding America's alarmingly weak fiscal status, and putting still more downward pressure on the greenback, already worth a humble $1.49 to the euro.

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