"With growth at less than 1 percent in the first half of this year, the economy is effectively at a stall and facing the prospects of shocks from a European financial crisis that is decidedly not under control, spikes in oil prices and declines in business and household confidence," Summers writes. "The indicators suggest that the economy has at least a 1-in-3 chance of falling back into recession if nothing new is done to raise demand and spur growth."
Democrats' legislative options are limited. But Summers suggests they should push to renew a one-year payroll tax holiday Obama signed late last year. Not doing so would amount, essentially to anti-stimulus. But Obama's been advocating a renewed payroll holiday, to no avail. Most recently, he angled to renew the holiday as part of the debt limit deal -- but the final legislation did no such thing.