Government and Recessions

What steps should be taken to bring the economy out of recession?  Are there any other web sites that would deal with this question?

Before I explain what steps the government should take to get out of recession, let me establish that a recession is a time when business costs overtake income or sales revenue, squeezing or eliminating profits. 

That said, you'll understand that the approach I take to your question is one that emphasizes things that allow for the reappearance of profits.  Government can best accomplish that by reducing various burdens it imposes on enterprise.  That means tax reductions (preferably not one-time cuts that briefly spur consumption, but rather more permanent tax cuts that stimulate investment such as a cut in the capital gains tax) or tariff reductions that expand trade.  It also means reducing burdensome regulations and reducing government spending in as many areas as possible. 

Perhaps it runs against the grain of conventional wisdom to suggest that cutting government spending spurs the economy but here's how I look at it: Government has nothing to give anybody except what it first takes from somebody.  To spend, it must tax, borrow, or inflate to come up with the money and none of those things is a long-term stimulant to growth.  In fact, the first option is a detriment all the time and the second and third options can produce a short-term boost only at the expense of long-term growth.  Moreover, when government spends it by definition commands resources—and almost invariably commands them and uses them in less efficient ways than if the money were spent by those who earned it in the first place. 

Web sites that expand on these ideas include the following:

The Club for Growth: 

Americans for Tax Reform: 

The Heritage Foundation: