http://biz.yahoo.com/ap/080117/economy_stimulus.html
The United States is in difficulty with their falling economy and the government must do something to patch it up. George Bush plans on giving tax rebates of $300-$800 per person whom have an income of under $85,000. He also plans on giving tax breaks to many companies that would benefit the economy, which are kept anonymous. America is in a slump and Bush doesn’t want to go into a recession. The last recession that the United States has been in was in 2001. This is a huge amount of money, which is totalled to be around $100 billion dollars.
George Bush has decided to interfere with the free market economy to redistribute income distribution and to boost economic activity. The economic recession is natural in the business cycle, but Bush is trying to reduce its amplitude by bringing the economy up before it gets any lower. The tax rebate is to give money from the wealthy to the less wealthy. The Federal Reserve Chairman believes that it is beneficial for the economy to give money to the people who would spend it quickly. The companies receiving tax breaks are for businesses investing in new equipment, increases in food stamps, and higher unemployment benefits so that the economy can benefit from their business.
I’m glad that the government is stepping in and can recognize when there is a problem with the economy. I agree with all of Bush’s decisions and he backs them up with strong, well thought out points. Many people are supporting him and he has been planning this with many congressional leaders. I think that $100 billion is quite a lot, but if it can cause competition and reverse the recession, it is definitely worth it.
3 comments:
I definitely see the connection between the chapter and the article you chose. English economist John Maynard Keynes argued that the government should increase their own spending on goods and services while decreasing the amount of tax collected to correct periods of slow economic growth in order to stabilize the economy. The government is doing the right thing by giving tax rebates when the economy growth is slowed down. As a result of tax rebates, people will spend more money, which will help the economy. Tax breaks to companies will also benefit the economy because it encourages them to increase their spending. It is good that the government is intervening with the market now before the recession worsens.
-SC
It is a good idea for Bush to get money from the wealthy and distribute them among the poor. Since it is better for the economy to have more people with more money. Also, I am so glad that government decides to step in at this time. Since there is a major economic crisis in the US right now. It is wise for George Bush to give tax rebates since the economic growth is so slow. Tax rebates will hopefully make people spend more money. As a result simulating the economic growth of the country. they are receiving tax breaks. This article clearly shows how the government will get involve in a free market.
-k. chen
I agree with President Bush that the economy requires desperate measures due to the high risk of recession. If no immediate action is taken place, then the economy will start receding to post September 11, 2001 levels. Although President Bush calls for a tax rebate, I do not think it is quite useful. As we can see, markets dropped even more after the proposal of this tax rebate, proving very low confidence in this solution. I believe the market needs to recede a little because lately it has been up to high. I think it will be a while before the economy is stable again.
-DLAM
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