The United States has sent a strong signal that it is fully engaged with the agenda of the London Summit meeting on 2 April with its call for a coordinated effort to boost global economic demand and pull the world out of recession. In an interview with the Financial Times, Larry Summers, chief economic adviser to US President Barack Obama, calls on all nations to increase spending.

'There's no place that should be reducing its contribution to global demand right now. It is really the universal demand agenda,' he said. 'The right macro-economic focus for the G20 is on global demand and the world needs more global demand. The role of fiscal stimulus in Governments response to the economic crisis was addressed at the Washington Summit of G20 leaders in November last year and is identified by the UK as one of the issues which world leaders will want to discuss at the London Summit this April.

In its main leader column on 9 March, the Financial Times calls for a three-pronged strategy. The first is a fiscal stimulus, particularly from countries with the greatest capacity for public spending such as Germany and Japan. The second strand is for national governments to ensure their banking systems are sufficiently capitalised and deal with the toxic assets at the heart of the crisis. Lastly governments must inject new funds into the International Monetary Fund to ensure the IMF can deal with an outbreak of crises in regions such as Eastern Europe, Asia or South America. 'A united front is essential. The aim is simple: end the brutal recession,' the leader article says. 'Big questions about the shape of the broad future of the world economy can wait until we are certain there is a future for globalisation.'

On 6 March the IMF produced a detailed analysis of the fiscal responses of key countries as part of a blueprint for reforming the way financial markets are regulated and for making international financial institutions, such as the IMF and the World Bank, more effective, that feed into the preparatory work for the London Summit. Analysis of the fiscal packages announced by the nine largest countries – Canada, China, France, Germany, India, Italy, Japan, the UK and the US – found the average amounted to 3.4% of GDP spread over 2008-2010. The largest package was 4.8% from the US followed by China's 4.4%.

However the debate over the issue is still fluid. Writing in the FT, Wolfgang Munchau says the best way to tackle the crisis is to restructure the banking system as well as provide short-term economic stimulus through monetary and fiscal policy. 'History never repeats itself exactly, but we know from economic history that financial crises are surprisingly similar,' he writes. 'This looks like Japan all over. Without financial restructuring, the economy is not going to recover.'

In the first of a series of articles on the Future of Capitalism, FT economics commentator Martin Wolf says that the crisis marks the end of the recent incarnation of deregulated financial capitalism. He said that 'at the extreme' the integration of the global economy might be reversed and that currently no credible alternative to the market economy exists. 'Where we end up, after this financial tornado, is for us to seek to determine.'

The issue of a fiscal response is likely to be discussed at the meeting of finance ministers and central bankers of the G20 in Horsham, UK, on 13 and 14 March. This is the main preparatory meeting of finance ministers and central bankers ahead of the leaders' summit. Four working groups on regulation, cooperation, IMF reform and the World Bank, will present their reports. Alistair Darling, the British Chancellor, has said that this meeting will lay the groundwork for the London Summit. In a letter to G20 colleagues, Mr Darling said there was a need for tougher global financial regulation and a return trust and confidence to financial markets.