Maine gas prices rise 3 cents, but nation has bigger spike

The bad news is that gas prices in Maine are on the rise again. The good news is that they are not rising as fast as they are nationally.

Price-monitoring website MaineGasPrices.com reported Monday that the average retail price of gasoline Maine rose nearly 3 cents last week to $3.86 per gallon. That compares to a 4.5 cents per gallon increase nationally to an average of $3.86.

Maine prices are now nearly 27 cents higher than on the same day a year ago and 9 cents higher than a month ago.

Economists see higher taxes as part of plan to cut deficit

Economists say a combination of higher taxes and lower spending is the best way to reduce the federal budget deficit, according to a survey on economic policies conducted by the National Association for Business Economists, released Monday.

The economists forecast that short-term interest rates would remain at current levels for at least another year. And they said the Federal Reserve should not buy more bonds to support and stimulate the economy, as it has in the past few years, even though the policy has been effective.

An overwhelming majority in the poll — 87 percent — said higher taxes should be considered along with less spending to reduce the federal budget deficit.

Germany open to raising crisis firewall to $930 billion

Germany has backed down from its resistance to boosting Europe’s financial firewalls after Chancellor Angela Merkel said she was open to temporarily boosting the eurozone’s bailout funds to $930 billion. But the move still falls short of what may be needed to protect Italy and Spain from collapse.

Germany had insisted there was no need to increase the lending capacity of the bailout funds beyond the planned $668 billion.

However, a temporary increase to $930 billion — of which close to $267 billion already is committed to previous bailouts — may not be enough to convince markets and global institutions such as the International Monetary Fund that the eurozone is doing enough to stop its debt crisis from spreading.